Rambus’ Sales Jump, but Earnings Drop 47%

Rambus Inc., a supplier of computer memory technology, said Thursday that quarterly profit fell 47% as litigation costs rose, but the company increased revenue in both of its major businesses, technology licensing and patent royalties.

Earnings in the first quarter were $4.4 million, or 4 cents a share, compared with a year-earlier profit of $8.3 million, or 7 cents a share. Sales rose to $39.6 million from $32.5 million.

Rambus has for years sought royalties from some of the world’s largest chip makers on intellectual property that it asserts is used in standard computer memory chips, which are known as DRAM. The royalty business grew to $33 million in the first quarter, up from $27.5 million in the same period last year.

The legal battles, whose twists and turns set the cadence for Rambus’ stock movements, have not come without a cost.

Rambus said it bore $7 million in additional litigation costs from the year-earlier period. Total company costs rose to $34.7 million from $23.9 million in the same period last year.

In March, Los Altos, Calif.-based Rambus said it had settled a long-running patent case against Germany’s Infineon Technologies with Infineon agreeing to pay Rambus royalties. The move had come after a federal judge dismissed Rambus’ patent claims.

Earlier Thursday, Rambus announced that it had signed a five-year deal with Japan’s NEC Electronics Corp., which will license technology on a range of memory technology.

The deal helped lift Rambus’ shares 30 cents to $14.05 in regular trading on Nasdaq on a day when chip stocks largely fell. After the company’s quarterly results were released, the stock gave up 5 cents to $14 in after-hours trading.