Rambus Dips on New Look at Settlement

Hynix might want to put this issue behind it, as well. It stated in a filing with Korea's Financial Supervisory Service on Monday that it had set aside $346 million "in our 2004 financial books to settle indemnity claims by some U.S. clients and possible further claims and fines," according to a report by Reuters.

However, the portion of that which could be earmarked for Rambus remains unclear. Hynix is also involved in a grand jury price-fixing investigation by the U.S. government, to which Infineon agreed late last year to a fine of $160 million.

Analyst Daniel Amir with WR Hambrecht says Rambus would be unlikely to settle with Hynix before completion of a trial that's about to start next month in San Jose, Calif. He said Rambus' position in the Hynix trial is stronger than its position in the Infineon retrial, which Rambus lost at the month's start. This makes it less likely that Rambus would want to approach the bargaining table. Hambrecht doesn't do investment banking.

Also hitting Rambus shares Monday was its reduction in sales guidance for the current quarter. Rambus said sales will be between $37 million and $38 million, beneath its original projected range of $38 million to $42 million.

Rambus CEO Harold Hughes characterized the sales reduction as "not massive," and that it stems from "no particular issue."

However, Desai sees larger issues at work, citing his belief that an 18-month licensing contract for its XDR interface with Sony(SNE) and Toshiba for the PlayStation3 has expired. "This is likely the biggest reason for the sequential downtick in revenue and may prove to be just the tip of the iceberg."

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