What changed in this filing

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Item 1. Business

2022-02-28 compared with 2021-02-26 · 62 added, 61 removed, 98 unchanged (56% of the section changed)

1 unchanged sentence

We make industry-leading chips and IP that enable critical performance improvements for data center and other growing markets.

The ongoing shift to the cloud, along with the widespread advancement of artificial intelligence (“AI”) across the data center, 5G, automotive and Internet of Things (“IoT”), has led to exponential growth in data usage and tremendous demands on data infrastructure.

The ongoing shift to the cloud, along with the widespread advancement of artificial intelligence (“AI”) across the data center, edge and Internet of Things (“IoT”) end points, has led to exponential growth in data usage and tremendous demands on data infrastructure.

Creating fast and safe connections, both in and across systems, remains one of the most mission-critical design challenges limiting performance in advanced hardware for these markets.

The data center continues to be the Company’s primary focus market, demanding the highest performance and security, and drives greater than 80% of the revenue from Rambus chip and silicon IP sales.

As an industry pioneer with over 30 years of advanced semiconductor design experience, Rambus is ideally positioned to address the challenges of moving and protecting data.

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Rambus products and innovations deliver the increased bandwidth, capacity and security required to meet the world’s data needs and drive ever-greater end-user experiences.

Our strategic objectives are focusing our product portfolio and research around our core strength in semiconductors, optimizing our operational efficiency, and leveraging our strong cash generation to re-invest for growth.

We continue to maximize synergies across our businesses and customer base, leveraging the significant overlap in our ecosystem of customers, partners and influencers.

The Rambus product and technology roadmap, as well as our go-to-market strategy, is driven by the application-specific requirements of our focus markets.

2020 was an unprecedented year, with the onset of COVID-19 triggering uncertainty in the global marketplace.

Despite that turbulence, Rambus demonstrated great execution and significant product growth.

Continued commitment to our customers, careful supply management and the tremendous dedication and agility of the Rambus team worldwide drove this success.

Annual product revenue increased 56% year-over-year between 2019 and 2020.

Driven by continued gains in market share from our memory interface chips, we recognized record product revenue of $114.0 million in 2020.

Silicon IP achieved sustained revenue growth with design-win momentum at tier-1 system on chip (“SoC”) customers and strong execution from the businesses acquired in 2019.

Rambus successfully closed key patent licensing agreements with DRAM and SoC manufacturers, solidifying our foundation of sustained cash generation.

Rambus benefits from a balanced and diverse portfolio of offerings across chips, silicon IP and patent licensing with each of them contributing at scale.

From 2018 to 2021, product revenue sustained a 55% compound annual growth rate, making products the leading revenue source for the Company.

Driven by the continued market momentum of our memory interface chips, we recognized record product revenue of $143.9 million in 2021.

The Company achieved silicon IP growth through increasing design wins at leading system on chip (“SoC”) customers with contributions from the businesses acquired in 2021.

In addition, Rambus successfully closed key patent licensing agreements, solidifying our foundation of sustained cash generation and fueling investment in our product and technology roadmaps.

Rambus continued its technology leadership with the launch of the CXL Memory Interconnect Initiative and development of solutions for next-generation data centers.

Memory Interface Chips

Made for high speed, reliability and power efficiency, our DDR memory interface chips for registered, load-reduced and non-volatile dual in-line memory modules (“RDIMM,” “LRDIMM” and “NVDIMM,” respectively) deliver top-of-the-line performance and capacity to the next wave of enterprise and cloud servers.

Rambus offers DDR5, DDR4 and DDR3 memory interface chips to enable increased memory capacity, while maintaining peak performance for data-intensive work loads.

We sell our memory interface chips directly and indirectly to memory module manufacturers and OEMs worldwide through multiple channels, including our direct sales force and distributors.

We operate direct sales offices in the United States, Japan, Korea, Taiwan and China, where we employ sales personnel who serve our direct customers and manage our channel partners.

Made for high speed, reliability and power efficiency, Rambus DDR memory interface chips for server memory modules (e.g., RDIMMs) enable increased bandwidth and expanded capacity in enterprise and cloud servers.

The Rambus portfolio includes DDR5, DDR4 and DDR3 memory interface chips.

Rambus offers the industry’s fastest DDR5 Registering Clock Driver (“RCD”), providing the critical control signals and clock for operation of the memory module at top-of-the-line performance.

We sell memory interface chips directly and indirectly to memory module manufacturers and OEMs worldwide through multiple channels, including our direct sales force and distributors.

We operate direct sales offices in the United States, France, Japan, South Korea, Taiwan and China, where we employ sales personnel who serve our direct customers and manage our channel partners.

We operate a fabless business model and use third-party foundries and manufacturing contractors to fabricate, assemble and test our memory interface chips.

We also inspect and test parts in our US-based facilities.

We also inspect and test parts in our U.S.-based facilities.

This outsourced manufacturing approach allows us to focus our investment and resources on the research, development, design, sale and marketing of our products.

Outsourcing also allows us the flexibility needed to respond to new market opportunities, simplifies our operations and significantly reduces our capital requirements.

Rambus’ Silicon IP offers both Interface and Security IP solutions.

Rambus Silicon IP includes interface and security IP solutions that move and protect data in advanced applications.

Our Interface IP solutions feature both high-speed memory and chip-to-chip interconnect technologies.

With the acquisition of Northwest Logic, Inc.

(“Northwest Logic”) in August of 2019, Rambus now offers a complementary portfolio of physical interface (“PHY”) and companion digital controller

IPs to create a one-stop-shop for SoC designers.

With the acquisitions of AnalogX Inc.

and PLDA Group, Rambus expanded its portfolio of physical interface (“PHY”) and digital controller IP to offer industry-leading, integrated memory and interconnect subsystems.

These silicon-proven solutions are critical to high-performance data center, networking, AI, Machine Learning (“ML”) and automotive applications because they enable and optimize the transfer of data between chips and electronic devices.

The Rambus Security IP solutions include crypto cores, hardware roots of trust, high-speed protocol engines and chip provisioning technologies.

With the acquisition of the Secure Silicon IP and Protocols business from Verimatrix in December 2019, Rambus offers one of the industry’s most comprehensive portfolio of silicon-proven Security IP.

We offer one of the industry’s most comprehensive portfolios of security IP solutions, including crypto cores, hardware roots of trust, high-speed protocol engines and chip provisioning technologies.

With the growing threat environment, hardware-based, embedded security solutions are mission-critical for protecting data center, AI, networking, IoT, automotive and government applications.

Architecture Licenses

Rambus patented inventions are foundational to the semiconductor industry and licenses of our portfolio to our customers represent a significant portion of our revenue.

Rambus is committed to continuing to innovate and invent, thereby advancing semiconductor technology.

We sell Silicon IP solutions to leading chip makers worldwide for integration into their SoC and FPGA designs.

Rambus Silicon IP is sold through our direct sales force operating out of offices in the United States, France, Japan, South Korea, Taiwan and China.

Patent Licenses

Our patented inventions are foundational to the semiconductor industry and are licensed to leading semiconductor and system companies around the world.

Rambus continues to innovate and invent, thereby advancing semiconductor technology.

With a broad worldwide portfolio of patents covering memory architecture, high-speed serial links and security, we enhance our value and relevance in our target markets and create a platform for investment in product development.

Our Architecture Licenses enable our customers to use specified portions of our portfolio of patented inventions in the customer’s own digital electronics products, systems or services.

Our patent licenses enable our customers to use specified portions of our portfolio of patented inventions in the customer’s own digital electronics products, systems or services.

These licenses may also define the specific field of use where our customers may use or employ our inventions in their products.

License agreements are structured with fixed or variable, or a hybrid of fixed and variable royalty payments over certain periods ranging up to ten years.

Leading semiconductor and electronic system companies such as AMD, Broadcom, Cisco, Fujitsu, IBM, Marvell, Mediatek, Micron, Nanya, NVIDIA, Panasonic, Phison, Qualcomm, Renesas, Samsung, SK hynix, Socionext, STMicroelectronics, Toshiba, Western Digital, Winbond, and Xilinx have licensed our patents for use in their own products.

Leading semiconductor and electronic system companies such as AMD, Broadcom, Cisco, CXMT, Fujitsu, IBM, Kioxia, Marvell, Mediatek, Micron, Nanya, NVIDIA, Panasonic, Phison, Qualcomm, Renesas, Samsung, SK hynix, Socionext, STMicroelectronics, Western Digital, Winbond, and Xilinx have licensed our patents for use in their own products.

The semiconductor industry is intensely competitive and is characterized by rapid technological change, short product life cycles, cyclical market patterns, price erosion, increasing foreign and domestic competition and market consolidation.

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We expect to continue to invest substantial funds in research and development activities.

addition, because our customer agreements often call for us to provide engineering support, a portion of our total engineering costs are allocated to the cost of contract and other revenue.

In addition, because our customer agreements often call for us to provide engineering support, a portion of our total engineering costs are allocated to the cost of contract and other revenue.

Human Capital Resources

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None of our employees are covered by collective bargaining agreements.

Throughout the COVID-19 pandemic, our primary focus has been on the safety and well-being of our employees and their families.

Throughout the ongoing COVID-19 pandemic, our primary focus has been on the safety and well-being of our employees and their families.

Our global pandemic efforts include instituting a global employee assistance program while leveraging the advice and recommendations of infectious disease experts to establish proper safety standards.

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We utilize successful recruiting practices that yield qualified and dedicated employees who are driven to achieve our vision.

Recently, the employment market in the United States has been subject to a hyper-competitive compensation environment especially for technology companies in the San Francisco Bay Area and elsewhere.

Our human capital resources objectives, as described above, help us retain and motivate our existing employees, advisors, and consultants, which is a key component of increasing stockholder value and the success of Rambus.

We are an equal opportunity employer and are committed to maintaining a diverse and inclusive work environment.

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We have used, and intend to continue to use, our investor relations website as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD.

The inclusion of our website address in this report does not include or incorporate by reference into this report any information on our website.

The inclusion of our website address in this report does not include or

incorporate by reference into this report any information on our website.

You can obtain copies of our Forms 10-K, 10-Q, 8-K, and other filings with the SEC, and all amendments to these filings, free of charge, from our website as soon as reasonably practicable following our filing of any of these reports with the SEC.

In addition, you may read and copy any material we file

with the SEC at the SEC’s Public Reference Room at 100 F Street NE, Room 1580, Washington, D.C.

In addition, you may read and copy any material we file with the SEC at the SEC’s Public Reference Room at 100 F Street NE, Room 1580, Washington, D.C.

You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.

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Further, the Company’s references to the URLs for these websites are intended to be inactive textual references only.

Information concerning our revenue, results of operations and revenue by geographic area is set forth in Item 6, “Selected Financial Data,” in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and in Note 7, “Segments and Major Customers,” of Notes to Consolidated Financial Statements of this Form 10-K, all of which are incorporated herein by reference.

Information concerning our revenue, results of operations and revenue by geographic area is set forth in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and in Note 7, “Segments and Major Customers,” of Notes to Consolidated Financial Statements of this Form 10-K, all of which are incorporated herein by reference.

Information concerning identifiable assets and segment reporting is also set forth in Note 7, “Segments and Major Customers,” of Notes to Consolidated Financial Statements of this Form 10-K.

Information on customers that comprise 10% or more of our consolidated revenue and risks attendant to our foreign operations is set forth below in Item 1A, “Risk Factors.”

Our Named Executive Officers

Information regarding our named executive officers and their ages and positions as of February 26, 2021, is contained in the table below.

Our named executive officers are appointed by, and serve at the discretion of, our Board of Directors.

There is no family relationship between any of our named executive officers.

Our Executive Officers

Information regarding our current executive officers and their ages and positions is contained in the table below.

Our executive officers are appointed by, and serve at the discretion of, our Board of Directors.

There is no family relationship between any of our executive officers.

Name Age Position and Business Experience

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Seraphin also holds an MBA from the University of Hartford and has completed the senior executive program of Columbia University.

Rahul Mathur 47 Senior Vice President, Finance and Chief Financial Officer.

Mathur joined us in his current position in October 2016.

Prior to joining us, Mr.

Mathur served as senior vice president of finance at Cypress Semiconductor Corp., a provider of embedded memory, microcontroller, and analog semiconductor system solutions, from March 2015 to September 2016, where he was responsible for financial planning and investor relations.

From August 2012 to March 2015, Mr.

Mathur served as vice president of finance at Spansion, Inc.

(later acquired by Cypress Semiconductor Corp.).

Mathur served as vice president of finance at Picaboo Corporation from January 2012 to August 2012 and vice president of finance at CDNetworks Inc.

from January 2011 to December 2011.

Prior to January 2011, Mr.

Mathur held senior finance positions at Telesis Technologies, Inc., NetSuite Inc.

and KLA Corporation.

Mathur holds a Bachelor of Arts in applied mathematics from Dartmouth College and an M.B.A.

from the Wharton School of Business at the University of Pennsylvania.

Jae Kim 50 Mr.

Kim has served as the senior vice president, general counsel and secretary from February 2013 until February 2021 and as our vice president, corporate legal since July 2010.

Prior to his tenure at Rambus, Mr.

Kim held senior legal positions at Aricent Inc., a privately-held communications technology company and Electronics for Imaging Inc., a digital printing technology company.

Kim has also had significant experience in private practice with the law firm of Wilson Sonsini Goodrich & Rosati, P.C., where he advised high technology and emerging growth companies on mergers and acquisitions, private financings, public offerings, securities compliance, public company reporting and corporate governance.

Kim began his legal career as an attorney with the United States Securities and Exchange Commission, Division of Corporation Finance, in Washington, D.C.

Kim is a member of both the California State Bar and New York State Bar, and received a J.D.

from the American University, Washington College of Law, and his bachelor’s degree from Boston University.

Sean Fan 55 Senior Vice President, Chief Operating Office.

Fan has served as the senior vice president, chief operating office since August 2019.

Keith Jones 50 Vice President Finance and Interim Chief Financial Officer.

Jones has served as the Interim Chief Financial Officer since November 2021, prior to which date Mr.

Jones served as Chief Accounting Officer, Corporate Controller and Vice President of Finance.

Jones joined Rambus in February 2018.

Prior to Rambus, he served as the World-Wide Corporate Controller, Vice President of Finance and the Principal Accounting Officer at ShoreTel Inc., prior to its acquisition by Mitel Networks Corporation.

At ShoreTel, Keith oversaw the reporting, controls and treasury-related activities of the company.

Prior to that, he served as the Chief Financial Officer and Vice President of Finance at PDF Solutions, Inc.

overseeing the overall financial management of the company, including planning, tax, treasury, controls, reporting and merger and acquisition-related activity.

Jones has held numerous senior leadership positions at various technology companies including Interwoven and e-Time Capital and started his career as an Audit Manager with Deloitte and Touche.

Jones holds a Bachelor of Science in Business Administration with an emphasis in Accounting from California State University, Fresno.

Sean Fan 56 Senior Vice President, Chief Operating Officer.

Fan has served as the Senior Vice President, Chief Operating Officer since August 2019.

Prior to Rambus from March 2019 to June 2019, he served as Vice President and General Manager at Renesas Electronics Corporation, responsible for the datacenter business unit, a premier supplier of advanced semiconductor solutions.

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Fan served in various engineering and management roles with Lucent Microelectronics, Mitel Semiconductor, and the National Lab of Telecom Research in China.

John Shinn 53 Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer.

Shinn has served as the Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer since February 2021 and as our Vice President, Deputy General Counsel since October 2016.

Prior to Rambus, Mr.

Shinn was Vice President and General Counsel at Toptal, LLC, a global remote company that provides a freelancing platform, connecting businesses with software engineers, designers, finance experts, product managers, and project managers, from February 2016 until October 2016, where he was responsible for all aspects of the corporate legal function, including corporate governance, regulatory compliance, commercial transactions, intellectual property matters and employment law.

From February 2015 to January 2016, Mr.

Shinn served as the Vice President of Legal at Tanium, Inc., an enterprise software company at the forefront of security and systems management, where he was responsible for all aspects of the company legal function, including commercial licensing, partnership and vendor contracts, new hire and employment matters, sales compensation plan design and corporate legal matters.

Prior to February 2015, Mr.

Shinn held the Sr.

Director of Legal, Commercial Transactions at Brocade Communication Systems, Inc.

Shinn has also worked in private practice with the law firm of Wilson Sonsini Goodrich & Rosati, advising high tech and emerging growth companies on technology transactions and mergers and acquisitions.

Shinn began his legal career as a litigation attorney with a boutique intellectual property and securities litigation law firm in San Jose.

Shinn is a member of the State Bar of California and received his J.D.

from Santa Clara University and his bachelor’s degree in American and European History from Stanford University.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business