Cover Page
Cover Page | 3 Months Ended |
Mar. 31, 2020shares | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Mar. 31, 2020 |
Document Transition Report | false |
Entity File Number | 000-22339 |
Entity Registrant Name | RAMBUS INC |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 94-3112828 |
Entity Address, Address Line One | 1050 Enterprise Way |
Entity Address, Address Line Two | Suite 700 |
Entity Address, City or Town | Sunnyvale |
Entity Address, State or Province | CA |
Entity Address, Postal Zip Code | 94089 |
City Area Code | 408 |
Local Phone Number | 462-8000 |
Title of 12(b) Security | Common Stock, $.001 Par Value |
Trading Symbol | RMBS |
Security Exchange Name | NASDAQ |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Emerging Growth Company | false |
Entity Small Business | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 113,275,229 |
Entity Central Index Key | 0000917273 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 175,446 | $ 102,176 |
Marketable securities | 259,999 | 305,488 |
Accounts receivable | 44,364 | 44,039 |
Unbilled receivables | 172,042 | 184,366 |
Inventories | 9,848 | 10,086 |
Prepaids and other current assets | 17,057 | 18,524 |
Total current assets | 678,756 | 664,679 |
Intangible assets, net | 50,208 | 54,900 |
Goodwill | 183,465 | 183,465 |
Property, plant and equipment, net | 47,743 | 44,714 |
Operating lease right-of-use assets | 34,493 | 37,020 |
Deferred tax assets | 4,541 | 4,574 |
Unbilled receivables, long-term | 314,706 | 343,703 |
Other assets | 5,579 | 5,931 |
Total assets | 1,319,491 | 1,338,986 |
Current liabilities: | ||
Accounts payable | 15,730 | 9,549 |
Accrued salaries and benefits | 12,411 | 20,291 |
Deferred revenue | 10,121 | 11,947 |
Income taxes payable | 19,892 | 19,142 |
Operating lease liabilities | 5,194 | 6,357 |
Other current liabilities | 16,715 | 18,893 |
Total current liabilities | 80,063 | 86,179 |
Convertible notes | 150,561 | 148,788 |
Long-term operating lease liabilities | 38,074 | 39,889 |
Long-term income taxes payable | 55,163 | 60,094 |
Deferred tax liabilities | 14,140 | 13,846 |
Other long-term liabilities | 15,792 | 19,272 |
Total liabilities | 353,793 | 368,068 |
Commitments and contingencies (Notes 9, 11 and 15) | ||
Stockholders’ equity: | ||
Convertible preferred stock, $.001 par value: Authorized: 5,000,000 shares Issued and outstanding: no shares at March 31, 2020 and December 31, 2019 | 0 | 0 |
Common stock, $.001 par value: Authorized: 500,000,000 shares Issued and outstanding: 113,275,229 shares at March 31, 2020 and 112,131,352 shares at December 31, 2019 | 113 | 112 |
Additional paid-in capital | 1,264,000 | 1,261,142 |
Accumulated deficit | (298,227) | (290,244) |
Accumulated other comprehensive loss | (188) | (92) |
Total stockholders’ equity | 965,698 | 970,918 |
Total liabilities and stockholders’ equity | $ 1,319,491 | $ 1,338,986 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Stockholders’ equity: | ||
Convertible preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible preferred stock, authorized shares | 5,000,000 | 5,000,000 |
Convertible preferred stock, issued shares | 0 | 0 |
Convertible preferred stock, outstanding shares | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized shares | 500,000,000 | 500,000,000 |
Common stock, issued shares | 113,275,229 | 112,131,352 |
Common stock, outstanding shares | 113,275,229 | 112,131,352 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Revenue | |||
Revenue | $ 63,989 | $ 48,384 | |
Cost of revenue | |||
Cost of product revenue | [1] | 10,343 | 4,427 |
Cost of contract and other revenue | 1,198 | 2,908 | |
Amortization of acquired intangible assets | 4,344 | 3,863 | |
Cost of revenue | 15,885 | 11,198 | |
Gross profit | 48,104 | 37,186 | |
Operating expenses: | |||
Research and development | [1] | 36,664 | 40,619 |
Sales, general and administrative | [1] | 22,895 | 26,520 |
Amortization of acquired intangible assets | 348 | 1,125 | |
Restructuring charges | 836 | 331 | |
Change in fair value of earn-out liability | (1,800) | 0 | |
Total operating expenses | 58,943 | 68,595 | |
Operating loss | (10,839) | (31,409) | |
Interest income and other income (expense), net | 6,374 | 7,413 | |
Interest expense | (2,555) | (2,271) | |
Interest and other income (expense), net | 3,819 | 5,142 | |
Loss before income taxes | (7,020) | (26,267) | |
Provision for income taxes | 963 | 309 | |
Net loss | $ (7,983) | $ (26,576) | |
Net loss per share: | |||
Earnings per share, basic | $ (0.07) | $ (0.24) | |
Earnings per share, diluted | $ (0.07) | $ (0.24) | |
Weighted average shares used in per share calculation: | |||
Basic (in shares) | 112,907 | 109,692 | |
Diluted (in shares) | 112,907 | 109,692 | |
Royalties | |||
Revenue | |||
Revenue | $ 19,694 | $ 24,853 | |
Product revenue | |||
Revenue | |||
Revenue | 30,728 | 8,964 | |
Contract and other revenue | |||
Revenue | |||
Revenue | $ 13,567 | $ 14,567 | |
[1] | Includes stock-based compensation: Cost of product revenue $ — $ 1 Research and development $ 2,613 $ 3,210 Sales, general and administrative $ 3,459 $ 3,978 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cost of product revenue | ||
Stock-based compensation | $ 0 | $ 1 |
Research and development | ||
Stock-based compensation | 2,613 | 3,210 |
Sales, general and administrative | ||
Stock-based compensation | $ 3,459 | $ 3,978 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (7,983) | $ (26,576) |
Other comprehensive income (loss): | ||
Foreign currency translation adjustment | 0 | 1,575 |
Unrealized gain (loss) on marketable securities, net of tax | (96) | 48 |
Total comprehensive loss | $ (8,079) | $ (24,953) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive gain (loss) |
Balance (in shares) at Dec. 31, 2018 | 109,018 | ||||
Balance at Dec. 31, 2018 | $ 1,012,112 | $ 109 | $ 1,226,588 | $ (204,294) | $ (10,291) |
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | (26,576) | (26,576) | |||
Foreign currency translation adjustment | 1,575 | 1,575 | |||
Unrealized gain (loss) on marketable securities, net of tax | 48 | 48 | |||
Issuance of common stock upon exercise of options, equity stock and stock units, and employee stock purchase plan (in shares) | 1,378 | ||||
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan | 1,070 | $ 1 | 1,069 | ||
Stock-based compensation | 7,189 | 7,189 | |||
Cumulative effect adjustment from adoption of new accounting pronouncement | Cumulative effect adjustment from adoption of ASC 842 | 4,469 | 4,469 | |||
Balance (in shares) at Mar. 31, 2019 | 110,396 | ||||
Balance at Mar. 31, 2019 | 999,887 | $ 110 | 1,234,846 | (226,401) | (8,668) |
Balance (in shares) at Dec. 31, 2019 | 112,131 | ||||
Balance at Dec. 31, 2019 | 970,918 | $ 112 | 1,261,142 | (290,244) | (92) |
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | (7,983) | (7,983) | |||
Foreign currency translation adjustment | 0 | ||||
Unrealized gain (loss) on marketable securities, net of tax | (96) | (96) | |||
Issuance of common stock upon exercise of options, equity stock and stock units, and employee stock purchase plan (in shares) | 1,144 | ||||
Issuance of common stock upon exercise of options, equity stock and employee stock purchase plan | (3,213) | $ 1 | (3,214) | ||
Stock-based compensation | 6,072 | 6,072 | |||
Balance (in shares) at Mar. 31, 2020 | 113,275 | ||||
Balance at Mar. 31, 2020 | $ 965,698 | $ 113 | $ 1,264,000 | $ (298,227) | $ (188) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Cash Flows [Abstract] | ||
Restricted cash | $ 331 | |
Cash flows from operating activities: | ||
Net loss | (7,983) | $ (26,576) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Stock-based compensation | 6,072 | 7,189 |
Depreciation | 7,300 | 4,809 |
Amortization of intangible assets | 4,692 | 4,988 |
Non-cash interest expense and amortization of convertible debt issuance costs | 1,773 | 1,678 |
Deferred income taxes | 327 | (214) |
Income (Loss) from Equity Method Investments | (212) | (81) |
Loss from disposal of property, plant and equipment | 0 | 98 |
Change in fair value of earn-out liability | (1,800) | 0 |
Change in operating assets and liabilities, net of impact of acquisitions: | ||
Accounts receivable | (325) | 7,372 |
Unbilled receivables | 41,321 | 44,181 |
Prepaid expenses and other assets | 1,854 | (1,153) |
Inventories | 238 | (1,370) |
Accounts payable | 416 | 2,171 |
Accrued salaries and benefits and other liabilities | (7,966) | (4,699) |
Increase (decrease) in income taxes payable | (4,069) | (3,939) |
Deferred revenue | (1,826) | (3,571) |
Increase (decrease) in operating lease liabilities | (2,978) | (2,284) |
Net cash provided by operating activities | 37,258 | 28,761 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (1,950) | (664) |
Purchases of marketable securities | (169,866) | (131,601) |
Maturities of marketable securities | 215,164 | 130,772 |
Settlement of working capital adjustment from disposal of business | (1,131) | 0 |
Net cash provided by (used in) investing activities | 42,217 | (1,493) |
Cash flows from financing activities: | ||
Proceeds received from issuance of common stock under employee stock plans | 4,005 | 4,856 |
Payments of taxes on restricted stock units | (7,218) | (3,786) |
Payments under installment payment arrangement | (2,551) | (1,240) |
Net cash used in financing activities | (5,764) | (170) |
Effect of exchange rate changes on cash and cash equivalents | (452) | 0 |
Net increase in cash, cash equivalents and restricted cash | 73,259 | 27,098 |
Cash, cash equivalents and restricted cash at beginning of period | 102,518 | 116,252 |
Cash, cash equivalents and restricted cash at end of period | 175,777 | 143,350 |
Non-cash investing and financing activities during the period: | ||
Property, plant and equipment received and accrued in accounts payable and other liabilities | $ 33,190 | $ 6,828 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Cash, cash equivalents and restricted cash | ||
Restricted cash | $ 331 | $ 342 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Rambus Inc. (“Rambus” or the “Company”) and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in the accompanying unaudited condensed consolidated financial statements. In the opinion of management, the unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring items) necessary to state fairly the financial position and results of operations for each interim period presented. Interim results are not necessarily indicative of results for a full year. The unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) applicable to interim financial information. Certain information and Note disclosures included in the financial statements prepared in accordance with generally accepted accounting principles have been omitted in these interim statements pursuant to such SEC rules and regulations. The information included in this Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto in Form 10-K for the year ended December 31, 2019 . Comparability During the third quarter of 2019, in line with the Company’s divestiture of its payment and ticketing businesses and its refocus on its semiconductor operations, the chief operating decision maker (“CODM”) changed how he assesses performance and allocates resources. Based on this change, the Company determined it has one operating and reportable segment. The Company has revised prior comparative periods to conform to the current period segment presentation. Refer to Note 6, “Segment Information,” for additional information. Reclassifications Certain prior periods' amounts were reclassified to conform to the current year’s presentation. None of these reclassifications had an impact on reported net income for any of the periods presented. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recent Accounting Pronouncements Adopted In June 2016, the FASB issued ASU No. 2016-13. The purpose of this ASU is to require a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. Credit losses relating to available-for-sale debt securities should be recorded through an allowance for credit losses. In April 2019, the FASB issued ASU No. 2019-04, “Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments (ASU 2019-04),” which provided certain improvements to various ASUs, including ASU 2016-13. In May 2019, the FASB issued ASU No. 2019-05, “Financial Instruments-Credit Losses (Topic 326),” which provides an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. In November 2019, the FASB issued ASU No. 2019-10, “Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)” which amends certain effective dates. In November 2019, the FASB issued ASU No. 2019-11, “Financial Instruments-Credit Losses (Topic 326),” which provides additional clarifications. In March 2020, the FASB issued ASU No. 2020-03, “Codification Improvements to Financial Instruments,” which provides additional clarifications and improvements. These ASUs and the related amendments are effective for interim and annual reporting periods beginning after December 15, 2019. The Company adopted this ASU on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement.” The amendments in this ASU remove certain disclosures, modify certain disclosures and add additional disclosures. This ASU is effective for interim and annual reporting periods beginning after December 15, 2019. Certain disclosures in ASU No. 2018-13 would need to be applied on a retrospective basis and others on a prospective basis. The Company adopted this ASU on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” The amendments in this ASU remove certain exceptions, clarifies and amends existing guidance. This ASU is effective for interim and annual reporting periods beginning after December 15, 2020. Early adoption is permitted. Certain disclosures in ASU No. 2019-12 would need to be applied on a retrospective basis, modified retrospective basis, or prospective basis. The Company elected to early adopt this ASU on January 1, 2020. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. Recent Accounting Pronouncements Not Yet Adopted In January 2020, the FASB issued ASU No. 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815).” The amendments in this ASU clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options accounted for under Topic 815. This ASU is effective for interim and annual reporting periods beginning after December 15, 2020. Early adoption is permitted. The amendments in this ASU should be applied on a prospective basis. The Company is currently evaluating the impact that the adoption of this guidance will have on its condensed consolidated financial statements. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2020 | |
Revenue Recognition from Contracts with Customers [Abstract] | |
Revenue Recognition | Revenue Recognition Contract Balances Timing of revenue recognition may differ from the timing of invoicing to the Company’s customers. The Company records contract assets when revenue is recognized prior to invoicing, and a contract liability when revenue is recognized subsequent to invoicing. The contract assets are primarily related to the Company’s fixed fee IP licensing arrangements and rights to consideration for performance obligations delivered but not billed as of March 31, 2020 . The contract assets are transferred to receivables when the billing occurs. The Company’s contract balances were as follows: As of (In thousands) March 31, 2020 December 31, 2019 Unbilled receivables $ 486,748 $ 528,069 Deferred revenue 10,121 11,947 During the three months ended March 31, 2020 , the Company recognized $6.1 million of revenue that was included in the contract balances as of December 31, 2019. Remaining Performance Obligations Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Contracted but unsatisfied performance obligations were approximately $17.5 million as of March 31, 2020 , which the Company primarily expects to recognize over the next 2 years . |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share is calculated by dividing the net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by dividing the earnings by the weighted average number of common shares and potentially dilutive securities outstanding during the period. Potentially dilutive common shares consist of incremental common shares issuable upon exercise of stock options, employee stock purchases, restricted stock and restricted stock units and shares issuable upon the conversion of convertible notes. The dilutive effect of outstanding shares is reflected in diluted earnings per share by application of the treasury stock method. This method includes consideration of the amounts to be paid by the employees and the amount of unrecognized stock-based compensation related to future services. No potential dilutive common shares are included in the computation of any diluted per share amount when a net loss is reported. The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share amounts): Three Months Ended March 31, 2020 2019 Net loss per share: Numerator: Net loss $ (7,983 ) $ (26,576 ) Denominator: Weighted-average shares outstanding - basic 112,907 109,692 Effect of potential dilutive common shares — — Weighted-average shares outstanding - diluted 112,907 109,692 Basic net loss per share $ (0.07 ) $ (0.24 ) Diluted net loss per share $ (0.07 ) $ (0.24 ) For the three months ended March 31, 2020 and 2019 , options to purchase approximately 0.4 million and 1.7 million shares, respectively, were excluded from the calculation because they were anti-dilutive after considering proceeds from exercise and related unrecognized stock-based compensation expense. For the three months ended March 31, 2020 and 2019 , an additional 2.3 million and 0.9 million shares, respectively, were excluded from the weighted average dilutive shares because there was a net loss position for the periods. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Goodwill The following tables present goodwill information for the three months ended March 31, 2020 (in thousands): As of December 31, 2019 Additions to Goodwill As of March 31, 2020 Total goodwill $ 183,465 $ — $ 183,465 As of March 31, 2020 Gross Carrying Amount Accumulated Impairment Losses Net Carrying Amount Total goodwill $ 205,235 $ (21,770 ) $ 183,465 Intangible Assets, Net The components of the Company’s intangible assets as of March 31, 2020 and December 31, 2019 were as follows: As of March 31, 2020 (In thousands) Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Existing technology 3 to 10 years $ 262,789 $ (217,767 ) $ 45,022 Customer contracts and contractual relationships 0.5 to 10 years 36,293 (33,707 ) 2,586 Non-compete agreements and trademarks 3 years 300 (300 ) — In-process research and development Not applicable 2,600 — 2,600 Total intangible assets $ 301,982 $ (251,774 ) $ 50,208 As of December 31, 2019 (In thousands) Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Existing technology 3 to 10 years $ 262,789 $ (213,354 ) $ 49,435 Customer contracts and contractual relationships 0.5 to 10 years 36,293 (33,428 ) 2,865 Non-compete agreements and trademarks 3 years 300 (300 ) — In-process research and development Not applicable 2,600 — 2,600 Total intangible assets $ 301,982 $ (247,082 ) $ 54,900 During the three months ended March 31, 2020 and 2019 , the Company did not purchase or sell any intangible assets. Amortization expense for intangible assets for the three months ended March 31, 2020 and 2019 was $4.7 million and $5.0 million , respectively. The estimated future amortization of intangible assets as of March 31, 2020 was as follows (in thousands): Years Ending December 31: Amount 2020 (remaining nine months) $ 13,721 2021 14,411 2022 7,444 2023 6,740 2024 5,292 Thereafter — Total amortizable purchased intangible assets $ 47,608 In-process research and development 2,600 Total intangible assets $ 50,208 It is reasonably possible that the businesses could perform significantly below the Company’s expectations or a deterioration of market and economic conditions could occur. This would adversely impact the Company’s ability to meet its projected results, which could cause the goodwill of its reporting unit or long-lived assets in any of its asset groups to become impaired. Significant differences between these estimates and actual cash flows could materially affect the Company’s future financial results. If the Company determines that its goodwill or long-lived assets are impaired, it would be required to record a non-cash charge that could have a material adverse effect on its results of operations and financial position. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Operating segments are based upon Rambus’ internal organization structure, the manner in which its operations are managed, the criteria used by its CODM to evaluate segment performance and availability of separate financial information regularly reviewed for resource allocation and performance assessment. The Company has determined its CODM to be the Chief Executive Officer (“CEO”). In line with the Company’s divestiture of its payment and ticketing businesses and its refocus on its semiconductor operations, commencing in the third quarter of 2019, the CEO reviews financial information presented on a consolidated basis for purposes of managing the business, allocating resources, making operating decisions and assessing financial performance. On this basis, the Company is organized and operates as a single segment within the semiconductor space. As of March 31, 2020 , the Company has a single operating and reportable segment. Accordingly, no additional disclosure of segment measures of profit or loss or total assets is applicable for all periods presented. The Company has recast the prior period segment information to reflect the new segment structure. Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable at March 31, 2020 and December 31, 2019 , respectively, was as follows: As of Customer March 31, 2020 December 31, 2019 Customer 1 21 % 19 % Customer 2 21 % 14 % Revenue from the Company’s major customers representing 10% or more of total revenue for the three months ended March 31, 2020 and 2019 , respectively, was as follows: Three Months Ended March 31, Customer 2020 2019 Customer A * 19 % Customer B 15 % 16 % Customer C 14 % * Customer D 12 % * _________________________________________ * Customer accounted for less than 10% of total revenue in the period Revenue from customers in the geographic regions based on the location of contracting parties was as follows: Three Months Ended March 31, (In thousands) 2020 2019 USA $ 34,788 $ 34,239 Taiwan 7,064 2,101 South Korea 1,820 1,281 Japan 2,843 2,619 Europe 738 3,375 Canada 512 1,058 Singapore 7,630 1,884 Asia-Other 8,594 1,827 Total $ 63,989 $ 48,384 |
Marketable Securities
Marketable Securities | 3 Months Ended |
Mar. 31, 2020 | |
Debt Securities, Available-for-sale [Abstract] | |
Marketable Securities | Marketable Securities Rambus invests its excess cash and cash equivalents primarily in U.S. government-sponsored obligations, commercial paper, corporate notes and bonds, money market funds and municipal notes and bonds that mature within three years . As of March 31, 2020 and December 31, 2019 , all of the Company’s cash equivalents and marketable securities had a remaining maturity of less than one year . All cash equivalents and marketable securities are classified as available-for-sale. Total cash, cash equivalents and marketable securities are summarized as follows: As of March 31, 2020 (In thousands) Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Weighted Rate of Return Money market funds $ 22,143 $ 22,143 $ — $ — 0.32 % U.S. Government bonds and notes 44,247 44,135 112 — 1.20 % Corporate notes, bonds, commercial paper and other 323,639 323,892 47 (300 ) 1.61 % Total cash equivalents and marketable securities 390,029 390,170 159 (300 ) Cash 45,416 45,416 — — Total cash, cash equivalents and marketable securities $ 435,445 $ 435,586 $ 159 $ (300 ) As of December 31, 2019 (In thousands) Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Weighted Rate of Return Money market funds $ 10,065 $ 10,065 $ — $ — 1.48 % U.S. Government bonds and notes 39,086 39,087 — (1 ) 1.49 % Corporate notes, bonds, commercial paper and other 314,391 314,435 19 (63 ) 1.81 % Total cash equivalents and marketable securities 363,542 363,587 19 (64 ) Cash 44,122 44,122 — — Total cash, cash equivalents and marketable securities $ 407,664 $ 407,709 $ 19 $ (64 ) Available-for-sale securities are reported at fair value on the balance sheets and classified as follows: As of (In thousands) March 31, 2020 December 31, 2019 Cash equivalents $ 130,030 $ 58,054 Short term marketable securities 259,999 305,488 Total cash equivalents and marketable securities 390,029 363,542 Cash 45,416 44,122 Total cash, cash equivalents and marketable securities $ 435,445 $ 407,664 The Company continues to invest in highly rated quality, highly liquid debt securities. The Company holds all of its marketable securities as available-for-sale, marks them to market, and regularly reviews its portfolio to ensure adherence to its investment policy and to monitor individual investments for risk analysis, proper valuation, and unrealized losses that may be other than temporary. The estimated fair value of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position at March 31, 2020 and December 31, 2019 are as follows: Fair Value Gross Unrealized Loss (In thousands) March 31, 2020 December 31, 2019 March 31, 2020 December 31, 2019 Less than one year U.S. Government bonds and notes $ — $ 14,112 $ — $ (1 ) Corporate notes, bonds and commercial paper 182,702 250,822 (300 ) (63 ) Total Corporate notes, bonds, and commercial paper and U.S. Government bonds and notes $ 182,702 $ 264,934 $ (300 ) $ (64 ) The gross unrealized loss at March 31, 2020 and December 31, 2019 was not material in relation to the Company’s total available-for-sale portfolio. The gross unrealized loss can be primarily attributed to a combination of market conditions as well as the demand for and duration of the U.S. government-sponsored obligations and corporate notes and bonds. There is no need to sell these investments, and the Company believes that it can recover the amortized cost of these investments. The Company has found no evidence of impairment due to credit losses in its portfolio. Therefore, these unrealized losses were recorded in other comprehensive income. However, the Company cannot provide any assurance that its portfolio of cash, cash equivalents and marketable securities will not be impacted by adverse conditions in the financial markets, which may require the Company in the future to record an impairment charge for credit losses which could adversely impact its financial results. Refer to Note 8, “Fair Value of Financial Instruments,” for discussion regarding the fair value of the Company’s cash equivalents and marketable securities. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The following table presents the financial instruments that are carried at fair value and summarizes the valuation of its cash equivalents and marketable securities by the above pricing levels as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 (In thousands) Total Quoted Market Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market funds $ 22,143 $ 22,143 $ — $ — U.S. Government bonds and notes 44,247 — 44,247 — Corporate notes, bonds, commercial paper and other 323,639 — 323,639 — Total available-for-sale securities $ 390,029 $ 22,143 $ 367,886 $ — As of December 31, 2019 (In thousands) Total Quoted Market Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market funds $ 10,065 $ 10,065 $ — $ — U.S. Government bonds and notes 39,086 — 39,086 — Corporate notes, bonds, commercial paper and other 314,391 — 314,391 — Total available-for-sale securities $ 363,542 $ 10,065 $ 353,477 $ — The Company monitors its investments for other-than-temporary impairment and records appropriate reductions in carrying value when necessary. The Company monitors its investments for other-than-temporary losses by considering current factors, including the economic environment, market conditions, operational performance and other specific factors relating to the business underlying the investment, reductions in carrying values when necessary and the Company’s ability and intent to hold the investment for a period of time which may be sufficient for anticipated recovery in the market. Any other-than-temporary loss is reported under “Interest and other income (expense), net” in the condensed consolidated statement of operations. During the second half of 2018, the Company made an investment in a non-marketable equity security of a private company which is a level 3 measurement. This equity investment is accounted for under the equity method of accounting, and the Company accounts for its equity method share of the income (loss) on a quarterly basis. As of March 31, 2020 , the Company’s 25.0% ownership percentage amounts to a $3.4 million equity interest in this equity investment and it is included in other assets on the accompanying consolidated balance sheets. The Company recorded an immaterial amount in its consolidated statements of operations representing its share of the investee’s loss for the three months ended March 31, 2020 and 2019 . For the three months ended March 31, 2020 and 2019 , there were no transfers of financial instruments between different categories of fair value. The following table presents the financial instruments that are not carried at fair value but require fair value disclosure as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 As of December 31, 2019 (In thousands) Face Value Carrying Value Fair Value Face Value Carrying Value Fair Value 1.375% Convertible Senior Notes due 2023 (the “2023 Notes”) $ 172,500 $ 150,561 $ 166,468 $ 172,500 $ 148,788 $ 174,239 The fair value of the convertible notes at each balance sheet date is determined based on recent quoted market prices for these notes which is a level 2 measurement. As discussed in Note 10, “Convertible Notes,” as of March 31, 2020 , the 2023 Notes are carried at their aggregate face value of $172.5 million , less any unamortized debt discount and unamortized debt issuance costs. The carrying value of other financial instruments, including accounts receivable, accounts payable and other liabilities, approximates fair value due to their short maturities. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases The Company leases office space, domestically and internationally, under operating leases. The Company’s leases have remaining lease terms generally between one year and ten years . Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities, and long-term operating lease liabilities in the Company’s unaudited condensed consolidated balance sheets. The Company does not have any finance leases. On July 8, 2019, the Company entered into a definitive triple net space lease agreement with 237 North First Street Holdings, LLC (the “Landlord”), whereby the Company will lease approximately 90,000 square feet of office space located at 4453 North First Street in San Jose, California (the “Lease”). The office space will serve as the Company’s corporate headquarters and include engineering, sales, marketing and administrative functions. The Company expects to move to the new premises during the second half of 2020. The Lease has a term of 128 months from the commencement date in October 2019. The starting rent of the Lease is approximately $3.26 per square foot on a triple net basis. The annual base rent increases each year to certain fixed amounts over the course of the term as set forth in the Lease and will be $4.38 per square foot in the eleventh year. In addition to the base rent, the Company will also pay operating expenses, insurance expenses, real estate taxes, and a management fee. The Lease also allows for an option to expand, wherein the Company has the right of first refusal to rent additional space in the building. The Company has a one-time option to extend the Lease for a period of 60 months and may elect to terminate the Lease, via written notice to the Landlord, in the event the office space is damaged or destroyed. Total future required payments under the Lease are approximately $41 million . Pursuant to the terms of the lease, the landlord agreed to reimburse the Company up to $8.9 million , related to a tenant improvement allowance. The lease of the Company’s current Sunnyvale, California headquarters expires on June 30, 2020. The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of March 31, 2020 (in thousands): Years ending December 31, Amount 2020 (remaining nine months) $ 4,685 2021 8,486 2022 7,332 2023 4,611 2024 3,977 Thereafter 23,314 Total minimum lease payments 52,405 Less: amount of lease payments representing interest (9,137 ) Present value of future minimum lease payments 43,268 Less: current obligations under leases (5,194 ) Long-term lease obligations $ 38,074 As of March 31, 2020 , the weighted-average remaining lease term for the Company’s operating leases was 7.9 years and the weighted-average discount rate used to determine the present value of the Company’s operating leases was 4.2% . Operating lease costs included in the condensed consolidated statements of operations were $2.9 million and $2.2 million for the three months ended March 31, 2020 and 2019 , respectively. Cash paid for amounts included in the measurement of operating lease liabilities were $2.3 million and $2.6 million for the three months ended March 31, 2020 and 2019 , respectively. |
Convertible Notes
Convertible Notes | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Notes | Convertible Notes The Company’s convertible notes are shown in the following table: As of (In thousands) March 31, 2020 December 31, 2019 2023 Notes $ 172,500 $ 172,500 Unamortized discount - 2023 Notes (20,514 ) (22,163 ) Unamortized debt issuance costs - 2023 Notes (1,425 ) (1,549 ) Total convertible notes $ 150,561 $ 148,788 Less current portion — — Total long-term convertible notes $ 150,561 $ 148,788 Interest expense related to the notes for the three months ended March 31, 2020 and 2019 was as follows: Three Months Ended March 31, (In thousands) 2020 2019 2023 Notes coupon interest at a rate of 1.375% $ 593 $ 593 2023 Notes amortization of discount and debt issuance costs at an additional effective interest rate of 4.9% 1,773 1,678 Total interest expense on convertible notes $ 2,366 $ 2,271 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies As of March 31, 2020 , the Company’s material contractual obligations were as follows (in thousands): Total Remainder of 2020 2021 2022 2023 2024 Contractual obligations (1) (2) Other contractual obligations $ 436 $ 218 $ 218 $ — $ — $ — Software licenses (3) 29,105 11,100 11,977 6,028 — — Acquisition retention bonuses (4) 9,998 3,499 3,499 3,000 — — Convertible notes 172,500 — — — 172,500 — Interest payments related to convertible notes 7,122 1,186 2,372 2,372 1,192 — Total $ 219,161 $ 16,003 $ 18,066 $ 11,400 $ 173,692 $ — _________________________________________ (1) The above table does not reflect possible payments in connection with uncertain tax benefits of approximately $26.1 million including $23.1 million recorded as a reduction of long-term deferred tax assets and $3.0 million in long-term income taxes payable as of March 31, 2020 . As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time. (2) For the Company’s lease commitments as of March 31, 2020 , refer to Note 9, “Leases.” (3) The Company has commitments with various software vendors for agreements generally having terms longer than one year . (4) In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment. Indemnification From time to time, the Company indemnifies certain customers as a necessary means of doing business. Indemnification covers customers for losses suffered or incurred by them as a result of any patent, copyright, or other intellectual property infringement or any other claim by any third party arising as result of the applicable agreement with the Company. The Company generally attempts to limit the maximum amount of indemnification or liability that the Company could be exposed to under these agreements, however, this is not always possible. The fair value of the liability as of March 31, 2020 and December 31, 2019 was not material. |
Equity Incentive Plans and Stoc
Equity Incentive Plans and Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Equity Incentive Plans and Stock-Based Compensation | Equity Incentive Plans and Stock-Based Compensation A summary of shares available for grant under the Company’s plans is as follows: Shares Available for Grant Shares available as of December 31, 2019 6,826,863 Stock options granted — Stock options forfeited 57,586 Nonvested equity stock and stock units granted (1) (2) (3,133,386 ) Nonvested equity stock and stock units forfeited (1) 675,987 Total available for grant as of March 31, 2020 4,427,050 _________________________________________ (1) For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each share of restricted stock granted reduces the number of shares available for grant by 1.5 shares and each share of restricted stock forfeited increases shares available for grant by 1.5 shares. (2) Amount includes approximately 0.5 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2020 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below. General Stock Option Information The following table summarizes stock option activity under the 2015 Plan for the three months ended March 31, 2020 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of March 31, 2020 . Options Outstanding Number of Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (In thousands, except per share amounts) Outstanding as of December 31, 2019 1,639,146 $ 11.37 Options granted — $ — Options exercised (387,662 ) $ 10.34 Options forfeited (57,586 ) $ 18.71 Outstanding as of March 31, 2020 1,193,898 $ 11.35 5.05 $ 1,393 Vested or expected to vest at March 31, 2020 1,190,813 $ 11.34 5.04 $ 1,393 Options exercisable at March 31, 2020 942,307 $ 10.93 4.21 $ 1,393 Employee Stock Purchase Plan No purchases were made under the 2015 Employee Stock Purchase Plan (“2015 ESPP”) during the three months ended March 31, 2020 and 2019 , respectively. As of March 31, 2020 , approximately 1.7 million shares under the 2015 ESPP remained available for issuance. Stock-Based Compensation For the three months ended March 31, 2020 and 2019 , the Company maintained stock plans covering a broad range of potential equity grants including stock options, nonvested equity stock and equity stock units and performance based instruments. In addition, the Company sponsors the 2015 ESPP, whereby eligible employees are entitled to purchase common stock semi-annually, by means of limited payroll deductions, at a 15% discount from the fair market value of the common stock as of specific dates. Stock Options There were no stock options granted during the three months ended March 31, 2020 and 2019 , respectively. During the three months ended March 31, 2020 and 2019 , the Company recorded stock-based compensation expense related to stock options of $0.1 million and $0.2 million , respectively. As of March 31, 2020 , there was $1.8 million of total unrecognized compensation cost, net of expected forfeitures, related to non-vested stock-based compensation arrangements granted under the stock option plans. That cost is expected to be recognized over a weighted-average period of 2.2 years . Employee Stock Purchase Plan For the three months ended March 31, 2020 and 2019 , the Company recorded compensation expense related to the 2015 ESPP of $0.5 million each in both periods. As of March 31, 2020 , there was $0.2 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under the 2015 ESPP. That cost is expected to be recognized over one month . Nonvested Equity Stock and Stock Units The Company grants nonvested equity stock units to officers, employees and directors. During the three months ended March 31, 2020 and 2019 , the Company granted nonvested equity stock units totaling approximately 1.7 million and 3.4 million shares, respectively, under the 2015 Plan. These awards have a service condition, generally a service period of four years , except in the case of grants to directors, for which the service period is one year . For the three months ended March 31, 2020 , the nonvested equity stock units were valued at the date of grant giving them a fair value of approximately $27.6 million . For the three months ended March 31, 2019 , the nonvested equity stock units were valued at the date of grant giving them a fair value of approximately $32.2 million . During the first quarters of 2020 and 2019, the Company granted performance unit awards to certain Company executive officers with vesting subject to the achievement of certain performance and/or market conditions. The ultimate number of performance units that can be earned can range from 0% to 200% of target depending on performance relative to target over the applicable period. The shares earned will vest on the third anniversary of the date of grant. The Company’s shares available for grant have been reduced to reflect the shares that could be earned at the maximum target. For the three months ended March 31, 2020 , the Company recorded stock-based compensation expense of approximately $5.4 million related to all outstanding nonvested equity stock grants. For the three months ended March 31, 2019 , the Company recorded stock-based compensation expense of approximately $6.4 million related to all outstanding nonvested equity stock grants. Unrecognized stock-based compensation related to all nonvested equity stock grants, net of estimated forfeitures, was approximately $48.7 million at March 31, 2020 . This amount is expected to be recognized over a weighted-average period of 2.7 years . The following table reflects the activity related to nonvested equity stock and stock units for the three months ended March 31, 2020 : Nonvested Equity Stock and Stock Units Shares Weighted- Average Grant-Date Fair Value Nonvested at December 31, 2019 5,289,483 $ 11.27 Granted 1,722,774 $ 16.02 Vested (1,192,626 ) $ 11.31 Forfeited (346,640 ) $ 11.39 Nonvested at March 31, 2020 5,472,991 $ 12.76 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Share Repurchase Program During the three months ended March 31, 2020 , the Company did not repurchase any shares of its common stock under its share repurchase program. On January 21, 2015, the Company’s Board approved a share repurchase program authorizing the repurchase of up to an aggregate of 20.0 million shares. Share repurchases under the plan may be made through the open market, established plans, or privately negotiated transactions in accordance with all applicable securities laws, rules, and regulations. There is no expiration date applicable to the plan. As of March 31, 2020 , there remained an outstanding authorization to repurchase approximately 3.6 million shares of the Company’s outstanding common stock under the current share repurchase program. The Company records stock repurchases as a reduction to stockholders’ equity. The Company records a portion of the purchase price of the repurchased shares as an increase to accumulated deficit when the price of the shares repurchased exceeds the average original proceeds per share received from the issuance of common stock. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recorded a provision for income taxes of $1.0 million and $0.3 million for the three months ended March 31, 2020 and 2019 , respectively. The provision for income taxes for the three months ended March 31, 2020 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets, foreign withholding taxes, the projected annual effective tax rate for the foreign jurisdictions for 2020 and indefinite-lived intangible tax amortization expense. The provision for income taxes for the three months ended March 31, 2019 was driven by a combination of the valuation allowance recorded on U.S. deferred tax assets and the projected annual effective tax rate for the foreign jurisdictions for 2019. During the three months ended March 31, 2020 and 2019 , the Company paid withholding taxes of $4.4 million and $4.3 million , respectively. The Company periodically evaluates the realizability of its net deferred tax assets based on all available evidence, both positive and negative. During the third quarter of 2018, the Company assessed the changes in its underlying facts and circumstances and evaluated the realizability of its existing deferred tax assets based on all available evidence, both positive and negative, and the weight accorded to each, and concluded a full valuation allowance associated with U.S. federal and California deferred tax assets was appropriate. As such, the Company set up and continues to maintain a full valuation allowance against its U.S. federal and California deferred tax assets. The Company has U.S. federal deferred tax assets related to research and development credits, foreign tax credits and other tax attributes that can be used to offset U.S. federal taxable income in future periods. These credit carryforwards will expire if they are not used within certain time periods. It is possible that some or all of these attributes could ultimately expire unused. The Company maintains liabilities for uncertain tax positions within its long-term income taxes payable accounts and as a reduction to existing deferred tax assets to the extent tax attributes are available to offset such liabilities. These liabilities involve judgment and estimation and are monitored by management based on the best information available including changes in tax regulations, the outcome of relevant court cases and other information. As of March 31, 2020 , the Company had approximately $121.0 million of unrecognized tax benefits, including $23.1 million recorded as a reduction of long-term deferred tax assets, $94.9 million recorded as a reduction of other assets associated with refundable withholding taxes previously withheld from licensees in South Korea (Korea), and $3.0 million recorded in long-term income taxes payable. If recognized, $3.0 million would be recorded as an income tax benefit. As a result of recent court rulings in Korea, the Company has determined that they may be entitled to refund claims for foreign taxes previously withheld from licensees in Korea. The Company recognizes that there are numerous risks and uncertainties associated with the ultimate collection of this refund, and, has therefore maintains an offsetting reserve for the entire amount of refundable withholding taxes previously withheld in Korea. As of December 31, 2019 , the Company had $115.7 million of unrecognized tax benefits, including $22.8 million recorded as a reduction of long-term deferred tax assets, $91 million recorded as a reduction of other assets associated with refundable withholding taxes previously withheld from licensees in South Korea, and $1.8 million recorded in long-term income taxes payable. Although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time. The Company recognizes interest and penalties related to uncertain tax positions as a component of the income tax provision. At March 31, 2020 and December 31, 2019 , an immaterial amount of interest and penalties is included in long-term income taxes payable. Rambus files income tax returns for the U.S., California, India, the U.K., the Netherlands and various other state and foreign jurisdictions. The U.S. federal returns are subject to examination from 2016 and forward. The California returns are subject to examination from 2010 and forward. In addition, any research and development credit carryforward or net operating loss carryforward generated in prior years and utilized in these or future years may also be subject to examination. The India returns are subject to examination from fiscal year ending March 2012 and forward. The Company is currently under examination by California for the 2010 and 2011 tax years. The Company’s India subsidiary is under examination by the Indian tax administration for tax years beginning with 2011, except for 2014, which was assessed in the Company’s favor. These examinations may result in proposed adjustments to the income taxes as filed during these periods. Management regularly assesses the likelihood of outcomes resulting from income tax examinations to determine the adequacy of their provision for income taxes and believes their provision for unrecognized tax benefits is adequate. Additionally, the Company’s future effective tax rates could be adversely affected by earnings being higher than anticipated in countries where the Company has higher statutory rates or lower than anticipated in countries where it has lower statutory rates, by changes in valuation of its deferred tax assets and liabilities or by changes in tax laws or interpretations of those laws. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted and signed into law. The CARES Act includes a number of federal income tax law changes, including, but not limited to (1) permitting net operating loss carrybacks to offset 100% of taxable income for taxable years beginning before 2021, (2) accelerating alternative minimum tax credit refunds, (3) temporarily increasing the allowable business interest deduction from 30% to 50% of adjusted taxable income, and (4) providing a technical correction for depreciation related to qualified improvement property. The Company has preliminarily evaluated the impact of the CARES Act and does not expect it will have a material impact on the Company’s condensed consolidated financial statements. |
Litigation and Asserted Claims
Litigation and Asserted Claims | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Text Block Supplement [Abstract] | |
Litigation and Asserted Claims | Litigation and Asserted Claims Rambus is not currently a party to any material pending legal proceeding; however, from time to time, Rambus may become involved in legal proceedings or be subject to claims arising in the ordinary course of its business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on our business, operating results, financial position or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management attention and resources and other factors. The Company records a contingent liability when it is probable that a loss has been incurred and the amount is reasonably estimable in accordance with accounting for contingencies. |
Restructuring Charges
Restructuring Charges | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges The 2019 Plan In June 2019, the Company initiated a restructuring program to reduce overall expenses which is expected to improve future profitability by reducing spending on research and development efforts and sales, general and administrative programs (the “2019 Plan”). In connection with this restructuring program, the Company initiated a plan of termination resulting in a reduction of approximately 80 employees. During the three months ended March 31, 2020 , the Company recorded a charge of approximately $0.8 million related to the reduction in workforce. As of March 31, 2020 , the Company’s accrued restructuring balance was approximately $0.5 million . The 2019 Plan is expected to be substantially completed in the second quarter of 2020. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue Recognition from Contracts with Customers [Abstract] | |
Contract balances | The Company’s contract balances were as follows: As of (In thousands) March 31, 2020 December 31, 2019 Unbilled receivables $ 486,748 $ 528,069 Deferred revenue 10,121 11,947 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted loss per share | The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share amounts): Three Months Ended March 31, 2020 2019 Net loss per share: Numerator: Net loss $ (7,983 ) $ (26,576 ) Denominator: Weighted-average shares outstanding - basic 112,907 109,692 Effect of potential dilutive common shares — — Weighted-average shares outstanding - diluted 112,907 109,692 Basic net loss per share $ (0.07 ) $ (0.24 ) Diluted net loss per share $ (0.07 ) $ (0.24 ) |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in carrying amount of goodwill | The following tables present goodwill information for the three months ended March 31, 2020 (in thousands): As of December 31, 2019 Additions to Goodwill As of March 31, 2020 Total goodwill $ 183,465 $ — $ 183,465 As of March 31, 2020 Gross Carrying Amount Accumulated Impairment Losses Net Carrying Amount Total goodwill $ 205,235 $ (21,770 ) $ 183,465 |
Components of intangible assets | The components of the Company’s intangible assets as of March 31, 2020 and December 31, 2019 were as follows: As of March 31, 2020 (In thousands) Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Existing technology 3 to 10 years $ 262,789 $ (217,767 ) $ 45,022 Customer contracts and contractual relationships 0.5 to 10 years 36,293 (33,707 ) 2,586 Non-compete agreements and trademarks 3 years 300 (300 ) — In-process research and development Not applicable 2,600 — 2,600 Total intangible assets $ 301,982 $ (251,774 ) $ 50,208 As of December 31, 2019 (In thousands) Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Existing technology 3 to 10 years $ 262,789 $ (213,354 ) $ 49,435 Customer contracts and contractual relationships 0.5 to 10 years 36,293 (33,428 ) 2,865 Non-compete agreements and trademarks 3 years 300 (300 ) — In-process research and development Not applicable 2,600 — 2,600 Total intangible assets $ 301,982 $ (247,082 ) $ 54,900 |
Estimated future amortization of intangible assets | The estimated future amortization of intangible assets as of March 31, 2020 was as follows (in thousands): Years Ending December 31: Amount 2020 (remaining nine months) $ 13,721 2021 14,411 2022 7,444 2023 6,740 2024 5,292 Thereafter — Total amortizable purchased intangible assets $ 47,608 In-process research and development 2,600 Total intangible assets $ 50,208 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Concentration Risk | |
Revenue from external customer by geographic regions | Revenue from customers in the geographic regions based on the location of contracting parties was as follows: Three Months Ended March 31, (In thousands) 2020 2019 USA $ 34,788 $ 34,239 Taiwan 7,064 2,101 South Korea 1,820 1,281 Japan 2,843 2,619 Europe 738 3,375 Canada 512 1,058 Singapore 7,630 1,884 Asia-Other 8,594 1,827 Total $ 63,989 $ 48,384 |
Accounts receivable | |
Concentration Risk | |
Schedule of customer accounts representing 10% or more than 10% of total revenue | Accounts receivable from the Company’s major customers representing 10% or more of total accounts receivable at March 31, 2020 and December 31, 2019 , respectively, was as follows: As of Customer March 31, 2020 December 31, 2019 Customer 1 21 % 19 % Customer 2 21 % 14 % |
Revenue | |
Concentration Risk | |
Schedule of customer accounts representing 10% or more than 10% of total revenue | Revenue from the Company’s major customers representing 10% or more of total revenue for the three months ended March 31, 2020 and 2019 , respectively, was as follows: Three Months Ended March 31, Customer 2020 2019 Customer A * 19 % Customer B 15 % 16 % Customer C 14 % * Customer D 12 % * _________________________________________ * Customer accounted for less than 10% of total revenue in the period |
Marketable Securities (Tables)
Marketable Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Securities, Available-for-sale [Abstract] | |
Cash equivalents and marketable securities classified as available-for-sale | All cash equivalents and marketable securities are classified as available-for-sale. Total cash, cash equivalents and marketable securities are summarized as follows: As of March 31, 2020 (In thousands) Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Weighted Rate of Return Money market funds $ 22,143 $ 22,143 $ — $ — 0.32 % U.S. Government bonds and notes 44,247 44,135 112 — 1.20 % Corporate notes, bonds, commercial paper and other 323,639 323,892 47 (300 ) 1.61 % Total cash equivalents and marketable securities 390,029 390,170 159 (300 ) Cash 45,416 45,416 — — Total cash, cash equivalents and marketable securities $ 435,445 $ 435,586 $ 159 $ (300 ) As of December 31, 2019 (In thousands) Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Weighted Rate of Return Money market funds $ 10,065 $ 10,065 $ — $ — 1.48 % U.S. Government bonds and notes 39,086 39,087 — (1 ) 1.49 % Corporate notes, bonds, commercial paper and other 314,391 314,435 19 (63 ) 1.81 % Total cash equivalents and marketable securities 363,542 363,587 19 (64 ) Cash 44,122 44,122 — — Total cash, cash equivalents and marketable securities $ 407,664 $ 407,709 $ 19 $ (64 ) |
Available-for-sale securities reported at fair value | Available-for-sale securities are reported at fair value on the balance sheets and classified as follows: As of (In thousands) March 31, 2020 December 31, 2019 Cash equivalents $ 130,030 $ 58,054 Short term marketable securities 259,999 305,488 Total cash equivalents and marketable securities 390,029 363,542 Cash 45,416 44,122 Total cash, cash equivalents and marketable securities $ 435,445 $ 407,664 |
Estimated fair value of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position | The estimated fair value of cash equivalents and marketable securities classified by the length of time that the securities have been in a continuous unrealized loss position at March 31, 2020 and December 31, 2019 are as follows: Fair Value Gross Unrealized Loss (In thousands) March 31, 2020 December 31, 2019 March 31, 2020 December 31, 2019 Less than one year U.S. Government bonds and notes $ — $ 14,112 $ — $ (1 ) Corporate notes, bonds and commercial paper 182,702 250,822 (300 ) (63 ) Total Corporate notes, bonds, and commercial paper and U.S. Government bonds and notes $ 182,702 $ 264,934 $ (300 ) $ (64 ) |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of the valuation of cash equivalents and marketable securities by pricing levels | The following table presents the financial instruments that are carried at fair value and summarizes the valuation of its cash equivalents and marketable securities by the above pricing levels as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 (In thousands) Total Quoted Market Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market funds $ 22,143 $ 22,143 $ — $ — U.S. Government bonds and notes 44,247 — 44,247 — Corporate notes, bonds, commercial paper and other 323,639 — 323,639 — Total available-for-sale securities $ 390,029 $ 22,143 $ 367,886 $ — As of December 31, 2019 (In thousands) Total Quoted Market Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Money market funds $ 10,065 $ 10,065 $ — $ — U.S. Government bonds and notes 39,086 — 39,086 — Corporate notes, bonds, commercial paper and other 314,391 — 314,391 — Total available-for-sale securities $ 363,542 $ 10,065 $ 353,477 $ — |
Financial instruments not carried at fair value but requiring fair value disclosure | The following table presents the financial instruments that are not carried at fair value but require fair value disclosure as of March 31, 2020 and December 31, 2019 : As of March 31, 2020 As of December 31, 2019 (In thousands) Face Value Carrying Value Fair Value Face Value Carrying Value Fair Value 1.375% Convertible Senior Notes due 2023 (the “2023 Notes”) $ 172,500 $ 150,561 $ 166,468 $ 172,500 $ 148,788 $ 174,239 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lessee, operating lease liability, maturities and undiscounted cash flows | The table below reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of March 31, 2020 (in thousands): Years ending December 31, Amount 2020 (remaining nine months) $ 4,685 2021 8,486 2022 7,332 2023 4,611 2024 3,977 Thereafter 23,314 Total minimum lease payments 52,405 Less: amount of lease payments representing interest (9,137 ) Present value of future minimum lease payments 43,268 Less: current obligations under leases (5,194 ) Long-term lease obligations $ 38,074 |
Convertible Notes (Tables)
Convertible Notes (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of convertible notes | The Company’s convertible notes are shown in the following table: As of (In thousands) March 31, 2020 December 31, 2019 2023 Notes $ 172,500 $ 172,500 Unamortized discount - 2023 Notes (20,514 ) (22,163 ) Unamortized debt issuance costs - 2023 Notes (1,425 ) (1,549 ) Total convertible notes $ 150,561 $ 148,788 Less current portion — — Total long-term convertible notes $ 150,561 $ 148,788 |
Schedule of interest expense on notes | Interest expense related to the notes for the three months ended March 31, 2020 and 2019 was as follows: Three Months Ended March 31, (In thousands) 2020 2019 2023 Notes coupon interest at a rate of 1.375% $ 593 $ 593 2023 Notes amortization of discount and debt issuance costs at an additional effective interest rate of 4.9% 1,773 1,678 Total interest expense on convertible notes $ 2,366 $ 2,271 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of material contractual obligations | As of March 31, 2020 , the Company’s material contractual obligations were as follows (in thousands): Total Remainder of 2020 2021 2022 2023 2024 Contractual obligations (1) (2) Other contractual obligations $ 436 $ 218 $ 218 $ — $ — $ — Software licenses (3) 29,105 11,100 11,977 6,028 — — Acquisition retention bonuses (4) 9,998 3,499 3,499 3,000 — — Convertible notes 172,500 — — — 172,500 — Interest payments related to convertible notes 7,122 1,186 2,372 2,372 1,192 — Total $ 219,161 $ 16,003 $ 18,066 $ 11,400 $ 173,692 $ — _________________________________________ (1) The above table does not reflect possible payments in connection with uncertain tax benefits of approximately $26.1 million including $23.1 million recorded as a reduction of long-term deferred tax assets and $3.0 million in long-term income taxes payable as of March 31, 2020 . As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time. (2) For the Company’s lease commitments as of March 31, 2020 , refer to Note 9, “Leases.” (3) The Company has commitments with various software vendors for agreements generally having terms longer than one year . (4) In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment. |
Equity Incentive Plans and St_2
Equity Incentive Plans and Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of shares available for grant | A summary of shares available for grant under the Company’s plans is as follows: Shares Available for Grant Shares available as of December 31, 2019 6,826,863 Stock options granted — Stock options forfeited 57,586 Nonvested equity stock and stock units granted (1) (2) (3,133,386 ) Nonvested equity stock and stock units forfeited (1) 675,987 Total available for grant as of March 31, 2020 4,427,050 _________________________________________ (1) For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each share of restricted stock granted reduces the number of shares available for grant by 1.5 shares and each share of restricted stock forfeited increases shares available for grant by 1.5 shares. (2) Amount includes approximately 0.5 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2020 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below. |
Schedule of stock option activity | The following table summarizes stock option activity under the 2015 Plan for the three months ended March 31, 2020 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of March 31, 2020 . Options Outstanding Number of Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value (In thousands, except per share amounts) Outstanding as of December 31, 2019 1,639,146 $ 11.37 Options granted — $ — Options exercised (387,662 ) $ 10.34 Options forfeited (57,586 ) $ 18.71 Outstanding as of March 31, 2020 1,193,898 $ 11.35 5.05 $ 1,393 Vested or expected to vest at March 31, 2020 1,190,813 $ 11.34 5.04 $ 1,393 Options exercisable at March 31, 2020 942,307 $ 10.93 4.21 $ 1,393 |
Schedule of nonvested equity stock and stock units activity | The following table reflects the activity related to nonvested equity stock and stock units for the three months ended March 31, 2020 : Nonvested Equity Stock and Stock Units Shares Weighted- Average Grant-Date Fair Value Nonvested at December 31, 2019 5,289,483 $ 11.27 Granted 1,722,774 $ 16.02 Vested (1,192,626 ) $ 11.31 Forfeited (346,640 ) $ 11.39 Nonvested at March 31, 2020 5,472,991 $ 12.76 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Revenue Recognition from Contracts with Customers [Abstract] | ||
Unbilled receivables | $ 486,748 | $ 528,069 |
Deferred revenue | 10,121 | $ 11,947 |
Contract balances, revenue recognized | 6,100 | |
Remaining performance obligations | $ 17,500 | |
Remaining performance obligations, expected timing of satisfaction period | 2 years |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Numerator: | ||
Net loss | $ (7,983) | $ (26,576) |
Denominator: | ||
Weighted-average common shares outstanding, basic (in shares) | 112,907 | 109,692 |
Effect of potential dilutive common shares | 0 | 0 |
Denominator: | ||
Weighted-average common shares outstanding, diluted (in shares) | 112,907 | 109,692 |
Earnings per share, basic | $ (0.07) | $ (0.24) |
Earnings per share, diluted | $ (0.07) | $ (0.24) |
Earnings (Loss) Per Share (De_2
Earnings (Loss) Per Share (Details 2) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Anti-dilutive shares excluded from calculation of earnings per share | ||
Anti-dilutive shares excluded from calculation of earnings per share | 2.3 | 0.9 |
Options | ||
Anti-dilutive shares excluded from calculation of earnings per share | ||
Anti-dilutive shares excluded from calculation of earnings per share | 0.4 | 1.7 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 183,465 |
Goodwill, Acquired During Period | 0 |
Ending Balance | $ 183,465 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill (Details 2) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Goodwill | ||
Gross Carrying Amount | $ 205,235 | |
Accumulated Impairment Losses | (21,770) | |
Net Carrying Amount | $ 183,465 | $ 183,465 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Components of intangible assets | |||
Accumulated Amortization | $ (251,774) | $ (247,082) | |
Finite-Lived Intangible Assets | 47,608 | ||
In-process research and development | 2,600 | ||
Intangible Assets, Gross | 301,982 | 301,982 | |
Intangible Assets, Net | 50,208 | 54,900 | |
Amortization expense for intangible assets | 4,692 | $ 4,988 | |
In-process research and development | |||
Components of intangible assets | |||
In-process research and development | 2,600 | 2,600 | |
Existing technology | |||
Components of intangible assets | |||
Gross Carrying Amount | 262,789 | 262,789 | |
Accumulated Amortization | (217,767) | (213,354) | |
Finite-Lived Intangible Assets | 45,022 | 49,435 | |
Customer contracts and contractual relationships | |||
Components of intangible assets | |||
Gross Carrying Amount | 36,293 | 36,293 | |
Accumulated Amortization | (33,707) | (33,428) | |
Finite-Lived Intangible Assets | $ 2,586 | $ 2,865 | |
Non-compete agreements and trademarks | |||
Components of intangible assets | |||
Useful Life (in years) | 3 years | 3 years | |
Gross Carrying Amount | $ 300 | $ 300 | |
Accumulated Amortization | (300) | (300) | |
Finite-Lived Intangible Assets | $ 0 | $ 0 | |
Minimum | Existing technology | |||
Components of intangible assets | |||
Useful Life (in years) | 3 years | 3 years | |
Minimum | Customer contracts and contractual relationships | |||
Components of intangible assets | |||
Useful Life (in years) | 6 months | 6 months | |
Maximum | Existing technology | |||
Components of intangible assets | |||
Useful Life (in years) | 10 years | 10 years | |
Maximum | Customer contracts and contractual relationships | |||
Components of intangible assets | |||
Useful Life (in years) | 10 years | 10 years |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill (Details 4) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Estimated future amortization expense of intangible assets | ||
2020 (remaining nine months) | $ 13,721 | |
2021 | 14,411 | |
2022 | 7,444 | |
2023 | 6,740 | |
2024 | 5,292 | |
Thereafter | 0 | |
Finite-Lived Intangible Assets | 47,608 | |
In-process research and development | 2,600 | |
Intangible Assets, Net | $ 50,208 | $ 54,900 |
Segment Information (Details)
Segment Information (Details) - Customer concentration risk - Accounts receivable | Mar. 31, 2020 | Dec. 31, 2019 |
Customer 1 | ||
Concentration Risk | ||
Customer concentration risk | 21.00% | 19.00% |
Customer 2 | ||
Concentration Risk | ||
Customer concentration risk | 21.00% | 14.00% |
Segment Information (Details 2)
Segment Information (Details 2) - Customer concentration risk - Revenue | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Customer A | ||
Concentration Risk | ||
Revenue from major customer as a percentage of total revenue | 19.00% | |
Customer B | ||
Concentration Risk | ||
Revenue from major customer as a percentage of total revenue | 15.00% | 16.00% |
Customer C | ||
Concentration Risk | ||
Revenue from major customer as a percentage of total revenue | 14.00% | |
Customer D | ||
Concentration Risk | ||
Revenue from major customer as a percentage of total revenue | 12.00% |
Segment Information (Details 3)
Segment Information (Details 3) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Major Customer Disclosure | ||
Revenue | $ 63,989 | $ 48,384 |
USA | ||
Major Customer Disclosure | ||
Revenue | 34,788 | 34,239 |
Taiwan | ||
Major Customer Disclosure | ||
Revenue | 7,064 | 2,101 |
South Korea | ||
Major Customer Disclosure | ||
Revenue | 1,820 | 1,281 |
Japan | ||
Major Customer Disclosure | ||
Revenue | 2,843 | 2,619 |
Europe | ||
Major Customer Disclosure | ||
Revenue | 738 | 3,375 |
Canada | ||
Major Customer Disclosure | ||
Revenue | 512 | 1,058 |
Singapore | ||
Major Customer Disclosure | ||
Revenue | 7,630 | 1,884 |
Asia-Other | ||
Major Customer Disclosure | ||
Revenue | $ 8,594 | $ 1,827 |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Cash equivalents and marketable securities | ||
Maximum maturity period of available-for-sale securities (in years) | 3 years | |
Maximum remaining maturity period of available-for-sale securities (in years) | 1 year | 1 year |
Fair Value | $ 390,029 | $ 363,542 |
Amortized Cost | 390,170 | 363,587 |
Gross Unrealized Gains | 159 | 19 |
Gross Unrealized Losses | (300) | (64) |
Cash, fair value | 45,416 | 44,122 |
Cash, amortized cost | 45,416 | 44,122 |
Cash, cash equivalents and marketable securities | ||
Fair Value | 435,445 | 407,664 |
Amortized Cost | 435,586 | 407,709 |
Gross Unrealized Gains | 159 | 19 |
Gross Unrealized Losses | (300) | (64) |
Money market funds | ||
Cash equivalents and marketable securities | ||
Fair Value | 22,143 | 10,065 |
Amortized Cost | 22,143 | 10,065 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | $ 0 | $ 0 |
Weighted Rate of Return (as a percent) | 0.32% | 1.48% |
US Government bonds and notes | ||
Cash equivalents and marketable securities | ||
Fair Value | $ 44,247 | $ 39,086 |
Amortized Cost | 44,135 | 39,087 |
Gross Unrealized Gains | 112 | 0 |
Gross Unrealized Losses | $ 0 | $ (1) |
Weighted Rate of Return (as a percent) | 1.20% | 1.49% |
Corporate notes, bonds and commercial paper and other | ||
Cash equivalents and marketable securities | ||
Fair Value | $ 323,639 | $ 314,391 |
Amortized Cost | 323,892 | 314,435 |
Gross Unrealized Gains | 47 | 19 |
Gross Unrealized Losses | $ (300) | $ (63) |
Weighted Rate of Return (as a percent) | 1.61% | 1.81% |
Marketable Securities Marketabl
Marketable Securities Marketable Securities (Details 2) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale | ||
Available-for-sale Securities | $ 390,029 | $ 363,542 |
Cash, fair value | 45,416 | 44,122 |
Cash, cash equivalents and marketable securities, fair value | 435,445 | 407,664 |
Cash equivalents | ||
Debt Securities, Available-for-sale | ||
Available-for-sale Securities | 130,030 | 58,054 |
Short-term marketable securities | ||
Debt Securities, Available-for-sale | ||
Available-for-sale Securities | $ 259,999 | $ 305,488 |
Marketable Securities (Details
Marketable Securities (Details 3) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale | ||
Less than one year, fair value | $ 182,702 | $ 264,934 |
Gross Unrealized Loss | ||
Less than one year, gross unrealized loss | (300) | (64) |
US Government bonds and notes | ||
Debt Securities, Available-for-sale | ||
Less than one year, fair value | 0 | 14,112 |
Gross Unrealized Loss | ||
Less than one year, gross unrealized loss | 0 | (1) |
Corporate notes, bonds and commercial paper and other | ||
Debt Securities, Available-for-sale | ||
Less than one year, fair value | 182,702 | 250,822 |
Gross Unrealized Loss | ||
Less than one year, gross unrealized loss | $ (300) | $ (63) |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | $ 390,029,000 | $ 363,542,000 |
Equity method investment, ownership percentage | 25.00% | |
Equity method investment | $ 3,400,000 | |
Money market funds | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 22,143,000 | 10,065,000 |
US Government bonds and notes | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 44,247,000 | 39,086,000 |
Corporate notes, bonds and commercial paper and other | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 323,639,000 | 314,391,000 |
Recurring basis | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 390,029,000 | 363,542,000 |
Recurring basis | Money market funds | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 22,143,000 | 10,065,000 |
Recurring basis | US Government bonds and notes | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 44,247,000 | 39,086,000 |
Recurring basis | Corporate notes, bonds and commercial paper and other | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 323,639,000 | 314,391,000 |
Recurring basis | Quoted Market Prices in Active Markets (Level 1) | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 22,143,000 | 10,065,000 |
Recurring basis | Quoted Market Prices in Active Markets (Level 1) | Money market funds | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 22,143,000 | 10,065,000 |
Recurring basis | Quoted Market Prices in Active Markets (Level 1) | US Government bonds and notes | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 0 | 0 |
Recurring basis | Quoted Market Prices in Active Markets (Level 1) | Corporate notes, bonds and commercial paper and other | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 0 | 0 |
Recurring basis | Significant Other Observable Inputs (Level 2) | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 367,886,000 | 353,477,000 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Money market funds | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 0 | 0 |
Recurring basis | Significant Other Observable Inputs (Level 2) | US Government bonds and notes | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 44,247,000 | 39,086,000 |
Recurring basis | Significant Other Observable Inputs (Level 2) | Corporate notes, bonds and commercial paper and other | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 323,639,000 | 314,391,000 |
Recurring basis | Significant Unobservable Inputs (Level 3) | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 0 | 0 |
Recurring basis | Significant Unobservable Inputs (Level 3) | Money market funds | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 0 | 0 |
Recurring basis | Significant Unobservable Inputs (Level 3) | US Government bonds and notes | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | 0 | 0 |
Recurring basis | Significant Unobservable Inputs (Level 3) | Corporate notes, bonds and commercial paper and other | ||
Financial assets subject to fair value measurements and the necessary disclosures | ||
Total available-for-sale securities | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments (Details 2) - 1.375% Convertible senior notes due 2023 - Convertible senior notes - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument | ||
Face value | $ 172,500 | $ 172,500 |
Carrying value | 150,561 | 148,788 |
Fair value | $ 166,468 | $ 174,239 |
Leases Lease Arrangement (Detai
Leases Lease Arrangement (Details) | Mar. 31, 2020USD ($) | Jul. 08, 2019USD ($)ft² |
Lessee, Lease, Description | ||
Lessee, operating lease, future lease payments, undiscounted | $ 52,405,000 | |
San Jose facility | ||
Lessee, Lease, Description | ||
Area of real estate property | ft² | 90,000 | |
Lessee, operating lease, term of contract | 128 months | |
Lessee, operating lease, variable rate, beginning of lease | $ 3.26 | |
Lessee, operating lease, variable rate, end of lease | $ 4.38 | |
Lessee, operating lease, renewal term | 60 months | |
Lessee, operating lease, future lease payments, undiscounted | 41,000,000 | |
Total reimbursement receivable under lease agreement | $ 8,900,000 |
Leases Operating Lease Maturiti
Leases Operating Lease Maturities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2020 (remaining nine months) | $ 4,685 | |
2021 | 8,486 | |
2022 | 7,332 | |
2023 | 4,611 | |
2024 | 3,977 | |
Thereafter | 23,314 | |
Total minimum lease payments | 52,405 | |
Less: amount of lease payments representing interest | 9,137 | |
Present value of future minimum lease payments | 43,268 | |
Operating lease liabilities | 5,194 | $ 6,357 |
Long-term operating lease liabilities | $ 38,074 | $ 39,889 |
Leases Additional Details (Deta
Leases Additional Details (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Lessee, Lease, Description | ||
Operating lease, weighted-average remaining lease term | 7 years 10 months 24 days | |
Operating lease, weighted-average discount rate (as a percentage) | 4.20% | |
Operating lease costs | $ 2.9 | $ 2.2 |
Operating lease payments | $ 2.3 | $ 2.6 |
Minimum | ||
Lessee, Lease, Description | ||
Lessee, operating lease, remaining lease term | 1 year | |
Maximum | ||
Lessee, Lease, Description | ||
Lessee, operating lease, remaining lease term | 10 years |
Convertible Notes (Details)
Convertible Notes (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 |
Debt Instrument | |||
Convertible notes, long-term | $ 150,561 | $ 148,788 | |
Convertible senior notes | 1.375% Convertible senior notes due 2023 | |||
Debt Instrument | |||
Convertible notes stated interest rate (as a percentage) | 1.375% | 1.375% | |
Principal amount of convertible notes | $ 172,500 | 172,500 | |
Unamortized discount | (20,514) | (22,163) | |
Unamortized debt issuance costs | (1,425) | (1,549) | |
Total convertible notes | 150,561 | 148,788 | |
Convertible notes, short-term | 0 | 0 | |
Convertible notes, long-term | $ 150,561 | $ 148,788 |
Convertible Notes (Details 2)
Convertible Notes (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Interest expense related to notes | ||
Amortization of discount and debt issuance costs | $ 1,773 | $ 1,678 |
Interest expense | 2,555 | 2,271 |
Convertible senior notes | 1.375% Convertible senior notes due 2023 | ||
Interest expense related to notes | ||
Interest | 593 | 593 |
Amortization of discount and debt issuance costs | 1,773 | 1,678 |
Interest expense | $ 2,366 | $ 2,271 |
Convertible notes stated interest rate (as a percentage) | 1.375% | 1.375% |
Effective interest rate of the liability component (as a percentage) | 4.90% | 4.90% |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($) | ||
Contractual obligations | ||
Remainder of 2020 | $ 16,003 | [1],[2] |
2021 | 18,066 | [1],[2] |
2022 | 11,400 | [1],[2] |
2023 | 173,692 | [1],[2] |
2024 | 0 | [1],[2] |
Total contractual obligation | 219,161 | [1],[2] |
unrecognized tax benefit excluding foreign tax withholdings | 26,100 | |
Other contractual obligations | ||
Contractual obligations | ||
Remainder of 2020 | 218 | [1],[2] |
2021 | 218 | [1],[2] |
2022 | 0 | [1],[2] |
2023 | 0 | [1],[2] |
2024 | 0 | [1],[2] |
Total contractual obligation | 436 | [1],[2] |
Software licenses | ||
Contractual obligations | ||
Remainder of 2020 | 11,100 | [1],[2],[3] |
2021 | 11,977 | [1],[2],[3] |
2022 | 6,028 | [1],[2],[3] |
2023 | 0 | [1],[2],[3] |
2024 | 0 | [1],[2],[3] |
Total contractual obligation | $ 29,105 | [1],[2],[3] |
Terms of noncancellable license agreement, minimum (in years) | 1 year | |
Acquisition retention bonuses | ||
Contractual obligations | ||
Remainder of 2020 | $ 3,499 | [1],[2],[4] |
2021 | 3,499 | [1],[2],[4] |
2022 | 3,000 | [1],[2],[4] |
2023 | 0 | [1],[2],[4] |
2024 | 0 | [1],[2],[4] |
Total contractual obligation | 9,998 | [1],[2],[4] |
Convertible notes | ||
Contractual obligations | ||
Remainder of 2020 | 0 | [1],[2] |
2021 | 0 | [1],[2] |
2022 | 0 | [1],[2] |
2023 | 172,500 | [1],[2] |
2024 | 0 | [1],[2] |
Total contractual obligation | 172,500 | [1],[2] |
Interest payments related to convertible notes | ||
Contractual obligations | ||
Remainder of 2020 | 1,186 | [1],[2] |
2021 | 2,372 | [1],[2] |
2022 | 2,372 | [1],[2] |
2023 | 1,192 | [1],[2] |
2024 | 0 | [1],[2] |
Total contractual obligation | $ 7,122 | [1],[2] |
[1] | For the Company’s lease commitments as of March 31, 2020 , refer to Note 9, “Leases.” | |
[2] | The above table does not reflect possible payments in connection with uncertain tax benefits of approximately $26.1 million including $23.1 million recorded as a reduction of long-term deferred tax assets and $3.0 million in long-term income taxes payable as of March 31, 2020 . As noted below in Note 14, “Income Taxes,” although it is possible that some of the unrecognized tax benefits could be settled within the next 12 months, the Company cannot reasonably estimate the outcome at this time. | |
[3] | The Company has commitments with various software vendors for agreements generally having terms longer than one year . | |
[4] | In connection with the acquisition of Northwest Logic in the third quarter of 2019 and the Secure Silicon IP and Protocols business in the fourth quarter of 2019, the Company is obligated to pay retention bonuses to certain employees subject to certain eligibility and acceleration provisions including the condition of employment. |
Equity Incentive Plans and St_3
Equity Incentive Plans and Stock-Based Compensation (Details) | 3 Months Ended | |
Mar. 31, 2020shares | ||
Stock compensation plan | ||
Shares available for grant | ||
Shares available, at the beginning of the year | 6,826,863 | |
Stock options granted (in shares) | 0 | |
Stock options forfeited (in shares) | 57,586 | |
Nonvested equity stock and stock units granted (in shares) | (3,133,386) | [1],[2] |
Nonvested equity stock and stock units forfeited (in shares) | 675,987 | [2] |
Shares available, at the end of the period | 4,427,050 | |
Conversion factor used to calculate the decrease in the number of shares available for grant resulting from the grant of restricted stock awards | 1.5 | |
Conversion factor used to calculate the increase in the number of shares available for grant resulting from the forfeiture of restricted stock awards | 1.5 | |
Potential additional performance stock units | ||
Shares available for grant | ||
Nonvested equity stock and stock units granted (in shares) | 500,000 | [1],[2] |
[1] | Amount includes approximately 0.5 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in the first quarter of 2020 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below. | |
[2] | For purposes of determining the number of shares available for grant under the 2015 Equity Incentive Plan (the “2015 Plan”) against the maximum number of shares authorized, each share of restricted stock granted reduces the number of shares available for grant by 1.5 shares and each share of restricted stock forfeited increases shares available for grant by 1.5 shares. |
Equity Incentive Plans and St_4
Equity Incentive Plans and Stock-Based Compensation (Details 2) - Options $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Number of Shares | |
Outstanding, at the beginning of the period | shares | 1,639,146 |
Options granted | shares | 0 |
Options exercised | shares | (387,662) |
Options forfeited | shares | (57,586) |
Outstanding, at the end of the period | shares | 1,193,898 |
Vested or expected to vest at the end of the period | shares | 1,190,813 |
Options exercisable at the end of the period | shares | 942,307 |
Weighted Average Exercise Price | |
Outstanding at the beginning of the period | $ / shares | $ 11.37 |
Options granted | $ / shares | 0 |
Options exercised | $ / shares | 10.34 |
Options forfeited | $ / shares | 18.71 |
Outstanding at the end of the period | $ / shares | 11.35 |
Vested or expected to vest at the end of the period | $ / shares | 11.34 |
Options exercisable at the end of the period | $ / shares | $ 10.93 |
Weighted Average Remaining Contractual Term (in years) | |
Outstanding | 5 years 18 days |
Vested or expected to vest | 5 years 14 days |
Options exercisable | 4 years 2 months 15 days |
Aggregate Intrinsic Value | |
Outstanding | $ | $ 1,393 |
Vested or expected to vest | $ | 1,393 |
Options exercisable | $ | $ 1,393 |
Equity Incentive Plans and St_5
Equity Incentive Plans and Stock-Based Compensation (Details 3) - Nonvested equity stock units and stock units - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Nonvested Equity Stock and Stock Units | ||
Nonvested at the beginning of the period (in shares) | 5,289,483 | |
Granted (in shares) | 1,722,774 | 3,400,000 |
Vested (in shares) | (1,192,626) | |
Forfeited (in shares) | (346,640) | |
Nonvested at the end of the period (in shares) | 5,472,991 | |
Weighted-Average Grant-Date Fair Value | ||
Nonvested at the beginning of the period (in dollars per share) | $ 11.27 | |
Granted (in dollars per share) | 16.02 | |
Vested (in dollars per share) | 11.31 | |
Forfeited (in dollars per share) | 11.39 | |
Nonvested at the end of the period (in dollars per share) | $ 12.76 |
Equity Incentive Plans and St_6
Equity Incentive Plans and Stock-Based Compensation (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Options | ||
Stock-based compensation | ||
Stock-based compensation expense | $ 0.1 | $ 0.2 |
Unrecognized compensation cost | $ 1.8 | |
Unrecognized compensation cost, weighted-average period | 2 years 2 months 12 days | |
Employee stock purchase plan | ||
Stock-based compensation | ||
Shares available for issuance | 1,700,000 | |
Discount from market price specific date | 15.00% | |
Stock-based compensation expense | $ 0.5 | 0.5 |
Unrecognized compensation cost | $ 0.2 | |
Unrecognized compensation cost, weighted-average period | 1 month | |
Nonvested equity stock units and stock units | ||
Stock-based compensation | ||
Stock-based compensation expense | $ 5.4 | $ 6.4 |
Unrecognized compensation cost | $ 48.7 | |
Unrecognized compensation cost, weighted-average period | 2 years 8 months 12 days | |
Granted (in shares) | 1,722,774 | 3,400,000 |
Awards, nonvested requisite service period | 4 years | |
Awards, nonvested grants in period, fair value | $ 27.6 | $ 32.2 |
Nonvested equity stock units and stock units | Director | ||
Stock-based compensation | ||
Awards, nonvested requisite service period | 1 year | |
Nonvested equity stock units and stock units | Minimum | ||
Stock-based compensation | ||
Awards, vesting rights (as a percentage) | 0.00% | |
Nonvested equity stock units and stock units | Maximum | ||
Stock-based compensation | ||
Awards, vesting rights (as a percentage) | 200.00% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - shares | Mar. 31, 2020 | Jan. 21, 2015 |
Share repurchase program | ||
Stock repurchase program, number of shares authorized to be repurchased | 20,000,000 | |
Stock repurchase program, remaining number of shares authorized to be repurchased | 3,600,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Valuation allowance | |||
Provision for (benefit from) income taxes | $ 963 | $ 309 | |
Unrecognized tax benefits | 121,000 | $ 115,700 | |
Portion of unrecognized tax benefits, which if recognized, would be recorded as an income tax benefit | 3,000 | ||
Foreign tax authority | |||
Valuation allowance | |||
Income taxes paid | 4,400 | $ 4,300 | |
Long-term deferred tax assets | |||
Valuation allowance | |||
Unrecognized tax benefits | 23,100 | 22,800 | |
Other assets | Foreign tax authority | |||
Valuation allowance | |||
Unrecognized tax benefits | 94,900 | 91,000 | |
Long-term income taxes payable | |||
Valuation allowance | |||
Unrecognized tax benefits | $ 3,000 | $ 1,800 |
Restructuring Charges (Details)
Restructuring Charges (Details) | 3 Months Ended | ||
Mar. 31, 2020USD ($) | Jun. 30, 2019 | Mar. 31, 2019USD ($) | |
Restructuring cost and reserve | |||
Restructuring charges | $ 836,000 | $ 331,000 | |
2019 Plan | |||
Restructuring cost and reserve | |||
Restructuring charges | 800,000 | ||
Restructuring accrual | $ 500,000 | ||
Restructuring and related cost, positions eliminated | |||
Restructuring and related cost, number of positions eliminated | 80 |