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» Rambus CEO Discusses Q3 2010 Results - Earnings Call Transcript
In an effort to help provide greater clarity to our financials, as we have been doing, we are using a non-GAAP pro forma format in our press release. We will continue to use the same format for our reporting. I need to advise you that the discussion today will contain forward-looking statements regarding our financial prospects, pending and current litigation, and demand for our technologies, amongst other things.These statements are subject to risks and uncertainties, which are more fully described in the documents we filed with the SEC, including our 8-Ks, 10-Qs, and 10-Ks. These forward-looking statements may differ materially from our actual results and we are under no obligation to update these statements. Further, as mentioned, we will discuss non-GAAP financials today and we have posted it on our website, reconciliation of these non-GAAP financials to the most directly comparable GAAP measures. You can find a copy of our earnings release and the recon on our website at www.rambus.com on the Investor Relations page, under Financial Releases. Now, I’ll turn the call over to Harold. Harold? Harold Hughes Thanks, Satish, and good afternoon, everyone. As we stated last quarter, we expected a great Q3 in terms of revenue and we delivered Q3’s revenues of $100 million was above the top end of our guidance. Thanks to strong contributions from our businesses across Rambus. Satish will go through the quarter’s financials in greater detail later in the call. A real highlight in Q3 was the signing of the license agreement with a major cell phone company for our Cryptography Research, differential power analysis, countermeasures technology. By the terms of the agreements, we won’t disclose the company’s name. But there are some details we can discuss. This was CRI’s first smartphone licensee, deal includes a license to CRI’s patents for using phones and tablets and includes recurring royalties.
(inaudible) becoming increasingly important for smartphones and tablets as they are used to conduct commerce, consume digital media and high-value content and store private user information. There is increasing recognition about the importance of DPA countermeasures in complex electronic devices. At a recent security conference in Japan, more than 50% of the users -50% of the talks were focused on side channel attacks.Side channel attacks represent a threat through a broad range of products and applications and DPA has been shown to be a powerful and effective side channel attack. We see the need and the interest in CRI’s patent to DPA countermeasures continuing to rise. We believe the deal we announced this quarter will be the first of many DPA countermeasure agreements we signed with smartphones and tablet manufacturers. Securing consumer electronics from DPA attacks is foundational to their usefulness and ties directly to our mission of enriching the end user experience using electronic devices. Continue to focus on CRI; during the quarter, we saw continued momentum in our Cryptography firewall security solution in the pay TV market. At the International Broadcasters Conference in September, we announced chip partnerships with MStar Semiconductor and Trident Microsystems. These companies join Broadcom, ST Microelectronics and Visics as partners, implementing CryptoFirewall security core technology in their set-top box SoCs. We deployed CryptoFirewall solutions at the chip level and then monetized downstream customers when they use the CryptoFirewall functionality. The CryptoFirewall core provides a robust hardware security foundation for broadcasters and conditional access companies to build secure services apart. We also announced a conditional service provider. Verimatrix has license to CryptoFirewall core for use and reinforcing its offerings. With this license, Verimatrix will be able to utilize the CryptoFirewall core present in the SoCs from the semiconductor companies I mentioned a moment ago. Downstream customer licenses such as the one with Verimatrix are solutions license agreements that will generate recurring royalties. Read the rest of this transcript for free on seekingalpha.com