FREMONT,
Calif., Oct. 18, 2023 /PRNewswire/ -- Lam Research
Corporation (the "Company," "Lam," "Lam Research") today announced
financial results for the quarter ended September 24, 2023 (the "September 2023 quarter").
Highlights for the September 2023
quarter were as follows:
- Revenue of $3.48 billion.
- U.S. GAAP gross margin of 47.5%, U.S. GAAP operating income as
a percentage of revenue of 29.4%, and U.S. GAAP diluted EPS of
$6.66.
- Non-GAAP gross margin of 47.9%, non-GAAP operating income as a
percentage of revenue of 30.1%, and non-GAAP diluted EPS of
$6.85.
Key Financial Data
for the Quarters Ended
September 24,
2023 and June 25, 2023
(in thousands,
except per-share data, percentages, and basis
points)
|
|
U.S.
GAAP
|
|
|
September
2023
|
|
June
2023
|
|
Change
Q/Q
|
Revenue
|
|
$
3,482,062
|
|
$
3,207,257
|
|
+ 8.6 %
|
Gross margin as
percentage of revenue
|
|
47.5 %
|
|
45.5 %
|
|
+ 200 bps
|
Operating income as
percentage of revenue
|
|
29.4 %
|
|
26.6 %
|
|
+ 280 bps
|
Diluted EPS
|
|
$
6.66
|
|
$
5.97
|
|
+
11.6 %
|
|
|
|
|
|
|
|
Non-GAAP
|
|
|
September
2023
|
|
June
2023
|
|
Change
Q/Q
|
Revenue
|
|
$
3,482,062
|
|
$
3,207,257
|
|
+ 8.6 %
|
Gross margin as
percentage of revenue
|
|
47.9 %
|
|
45.7 %
|
|
+ 220 bps
|
Operating income as
percentage of revenue
|
|
30.1 %
|
|
27.3 %
|
|
+ 280 bps
|
Diluted EPS
|
|
$
6.85
|
|
$
5.98
|
|
+
14.5 %
|
U.S. GAAP Financial Results
For the September 2023 quarter,
revenue was $3,482 million, gross
margin was $1,655 million, or 47.5%
of revenue, operating expenses were $632
million, operating income was 29.4% of revenue, and net
income was $887 million, or
$6.66 per diluted share on a U.S.
GAAP basis. This compares to revenue of $3,207 million, gross margin of $1,458 million, or 45.5% of revenue, operating
expenses of $604 million, operating
income of 26.6% of revenue, and net income of $803 million, or $5.97 per diluted share, for the quarter ended
June 25, 2023 (the "June 2023
quarter").
Non-GAAP Financial Results
For the September 2023 quarter,
non-GAAP gross margin was $1,669
million, or 47.9% of revenue, non-GAAP operating expenses
were $622 million, non-GAAP operating
income was 30.1% of revenue, and non-GAAP net income was
$912 million, or $6.85 per diluted share. This compares to
non-GAAP gross margin of $1,465
million, or 45.7% of revenue, non-GAAP operating expenses of
$590 million, non-GAAP operating
income of 27.3% of revenue, and non-GAAP net income of $803 million, or $5.98 per diluted share, for the June 2023 quarter.
"Lam continues to deliver strong results despite a cyclically
soft year for wafer fabrication equipment spending," said
Tim Archer, Lam Research's President
and Chief Executive Officer. "There are tremendous growth vectors
ahead for Lam, and we are investing strategically to drive
long-term outperformance."
Balance Sheet and Cash Flow Results
Cash and cash equivalents, short-term investments, and
restricted cash and investments balances decreased to $5.2 billion at the end of the September 2023 quarter compared to $5.6 billion at the end of the June 2023 quarter. The decrease was primarily the
result of $843 million of share
repurchases, including net share settlement of employee stock-based
compensation; $253 million of
repayment of debt, largely associated with the purchase of certain
properties under finance leases; and $230
million of dividends paid to stockholders, partially offset
by $951 million of cash generated
from operating activities.
Deferred revenue at the end of the September 2023 quarter decreased to $1,690 million compared to $1,838 million as of the end of the June 2023 quarter. Lam's deferred revenue balance
does not include shipments to customers in Japan, to whom title does not transfer until
customer acceptance. Shipments to customers in Japan are classified as inventory at cost
until the time of acceptance. The estimated future revenue from
shipments to customers in Japan
was approximately $261 million as of
September 24, 2023 and $160
million as of June 25, 2023.
Revenue
The geographic distribution of revenue during the September 2023 quarter is shown in the following
table:
Region
|
Revenue
|
China
|
48 %
|
Korea
|
16 %
|
Japan
|
9 %
|
United
States
|
8 %
|
Taiwan
|
7 %
|
Europe
|
7 %
|
Southeast
Asia
|
5 %
|
The following table presents revenue disaggregated between
system and customer support-related revenue:
|
Three Months
Ended
|
|
September
24,
2023
|
|
June 25,
2023
|
|
September
25,
2022
|
|
(In
thousands)
|
Systems
revenue
|
$
2,056,655
|
|
$
1,710,359
|
|
$
3,181,987
|
Customer
support-related revenue and other
|
1,425,407
|
|
1,496,898
|
|
1,892,134
|
|
$
3,482,062
|
|
$
3,207,257
|
|
$
5,074,121
|
|
|
|
|
|
|
Systems revenue includes sales of new leading-edge equipment in
deposition, etch and clean markets.
Customer support-related revenue includes sales of customer
service, spares, upgrades, and non-leading-edge equipment from our
Reliant® product line.
Outlook
For the quarter ended December 24, 2023, Lam is providing
the following guidance:
|
U.S.
GAAP
|
|
Reconciling
Items
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
$3.7 Billion
|
+/-
|
$300 Million
|
|
—
|
|
$3.7 Billion
|
+/-
|
$300 Million
|
Gross margin as a
percentage of revenue
|
46.5 %
|
+/-
|
1 %
|
|
$
17
|
Million
|
|
47.0 %
|
+/-
|
1 %
|
Operating income as a
percentage of revenue
|
28.6 %
|
+/-
|
1 %
|
|
$
32
|
Million
|
|
29.5 %
|
+/-
|
1 %
|
Net income per diluted
share
|
$6.78
|
+/-
|
$0.75
|
|
$
29
|
Million
|
|
$7.00
|
+/-
|
$0.75
|
Diluted share
count
|
132 Million
|
|
—
|
|
132 million
|
The information provided above is only an estimate of what the
Company believes is realizable as of the date of this release and
does not incorporate the potential impact of any business
combinations, asset acquisitions, divestitures, restructuring,
balance sheet valuation adjustments, financing arrangements, other
investments, or other significant arrangements that may be
completed or realized after the date of this release, except as
described below. U.S. GAAP to non-GAAP reconciling items provided
include only those items that are known and can be estimated as of
the date of this release. Actual results will vary from this model
and the variations may be material. Reconciling items included
above are as follows:
- Gross margin as a percentage of revenue - restructuring
charges, $7 million; transformational
costs, $7 million; and amortization
related to intangible assets acquired through business
combinations, $3 million; totaling
$17 million.
- Operating income as a percentage of revenue - transformational
costs, $22 million; restructuring
charges, $7 million; and amortization
related to intangible assets acquired through business
combinations, $3 million; totaling
$32 million.
- Net income per diluted share - transformational costs,
$22 million; restructuring charges,
$7 million; amortization related to
intangible assets acquired though business combinations,
$3 million; amortization of debt
discounts, $1 million; and associated
tax benefit for non-GAAP items ($4
million); totaling $29
million.
Use of Non-GAAP Financial Results
In addition to U.S. GAAP results, this press release also
contains non-GAAP financial results. The Company's non-GAAP results
for both the September 2023 and
June 2023 quarters exclude
amortization related to intangible assets acquired through business
combinations, the effects of elective deferred compensation-related
assets and liabilities, amortization of note discounts, net
restructuring charges, and transformational costs, and the net
income tax effect of non-GAAP items. Additionally, the non-GAAP
results for the June 2023 quarter
exclude the income tax benefit on conclusion of certain tax matters
related to a prior business combination and product rationalization
charges.
Management uses non-GAAP gross margin, operating expense,
operating income, operating income as a percentage of revenue, net
income, and net income per diluted share to evaluate the Company's
operating and financial results. The Company believes the
presentation of non-GAAP results is useful to investors for
analyzing business trends and comparing performance to prior
periods, along with enhancing investors' ability to view the
Company's results from management's perspective. Tables presenting
reconciliations of non-GAAP results to U.S. GAAP results are
included at the end of this press release and on the Company's
website at https://investor.lamresearch.com.
Caution Regarding Forward-Looking Statements
Statements made in this press release that are not of historical
fact are forward-looking statements and are subject to the safe
harbor provisions created by the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements relate to, but
are not limited to: our outlook and guidance for future financial
results, including revenue, gross margin, operating income and net
income; our prospects for growth; our investments; and our
long-term performance. Some factors that may affect these
forward-looking statements include: trade regulations, export
controls, trade disputes, and other geopolitical tensions may
inhibit our ability to sell our products; business, political
and/or regulatory conditions in the consumer electronics industry,
the semiconductor industry and the overall economy may deteriorate
or change; the actions of our customers and competitors may be
inconsistent with our expectations; supply chain cost increases and
other inflationary pressures have impacted and are expected to
continue to impact our profitability; supply chain disruptions or
manufacturing capacity constraints may limit our ability to
manufacture and sell our products; and natural and human-caused
disasters, disease outbreaks, war, terrorism, political or
governmental unrest or instability, or other events beyond our
control may impact our operations and revenue in affected areas; as
well as the other risks and uncertainties that are described in the
documents filed or furnished by us with the Securities and Exchange
Commission, including specifically the Risk Factors described in
our annual report on Form 10–K for the fiscal year ended
June 25, 2023. These uncertainties
and changes could materially affect the forward-looking statements
and cause actual results to vary from expectations in a material
way. The Company undertakes no obligation to update the information
or statements made in this release.
Lam Research Corporation is a global supplier of innovative
wafer fabrication equipment and services to the semiconductor
industry. Lam's equipment and services allow customers to build
smaller and better performing devices. In fact, today, nearly every
advanced chip is built with Lam technology. We combine superior
systems engineering, technology leadership, and a strong
values-based culture, with an unwavering commitment to our
customers. Lam Research (Nasdaq: LRCX) is a FORTUNE 500® company
headquartered in Fremont, Calif.,
with operations around the globe. Learn more at
www.lamresearch.com. (LRCX-F)
Consolidated Financial Tables Follow.
LAM RESEARCH
CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands,
except per share data and percentages)
(unaudited)
|
|
|
Three Months
Ended
|
|
September
24,
2023
|
|
June 25,
2023
|
|
September
25,
2022
|
Revenue
|
$ 3,482,062
|
|
$ 3,207,257
|
|
$ 5,074,121
|
Cost of goods
sold
|
1,819,420
|
|
1,737,682
|
|
2,737,286
|
Restructuring charges,
net - cost of goods sold
|
7,940
|
|
11,446
|
|
—
|
Total cost of goods
sold
|
1,827,360
|
|
1,749,128
|
|
2,737,286
|
Gross
margin
|
1,654,702
|
|
1,458,129
|
|
2,336,835
|
Gross margin as a
percent of revenue
|
47.5 %
|
|
45.5 %
|
|
46.1 %
|
Research and
development
|
422,629
|
|
401,951
|
|
433,375
|
Selling, general and
administrative
|
207,023
|
|
199,831
|
|
205,620
|
Restructuring charges,
net - operating expenses
|
2,021
|
|
1,742
|
|
—
|
Total operating
expenses
|
631,673
|
|
603,524
|
|
638,995
|
Operating
income
|
1,023,029
|
|
854,605
|
|
1,697,840
|
Operating income as a
percent of revenue
|
29.4 %
|
|
26.6 %
|
|
33.5 %
|
Other income (expense),
net
|
2,601
|
|
9,010
|
|
(43,095)
|
Income before income
taxes
|
1,025,630
|
|
863,615
|
|
1,654,745
|
Income tax
expense
|
(138,232)
|
|
(61,078)
|
|
(228,866)
|
Net income
|
$
887,398
|
|
$
802,537
|
|
$ 1,425,879
|
Net income per
share:
|
|
|
|
|
|
Basic
|
$
6.69
|
|
$
5.99
|
|
$
10.42
|
Diluted
|
$
6.66
|
|
$
5.97
|
|
$
10.39
|
Number of shares used
in per share calculations:
|
|
|
|
|
|
Basic
|
132,584
|
|
134,052
|
|
136,891
|
Diluted
|
133,166
|
|
134,392
|
|
137,208
|
Cash dividend declared
per common share
|
$
2.00
|
|
$
1.725
|
|
$
1.725
|
|
|
|
|
|
|
LAM RESEARCH
CORPORATION
CONDENSED
CONSOLIDATED BALANCE SHEETS
(in
thousands)
|
|
|
September
24,
2023
|
|
June 25,
2023
|
|
September
25,
2022
|
|
(unaudited)
|
|
(1)
|
|
(unaudited)
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
$
5,126,150
|
|
$
5,337,056
|
|
$
4,256,499
|
Investments
|
30,557
|
|
37,641
|
|
120,551
|
Accounts receivable,
net
|
2,810,953
|
|
2,823,376
|
|
4,569,735
|
Inventories
|
4,747,781
|
|
4,816,190
|
|
4,360,325
|
Prepaid expenses and
other current assets
|
278,121
|
|
214,149
|
|
305,554
|
Total current
assets
|
12,993,562
|
|
13,228,412
|
|
13,612,664
|
Property and equipment,
net
|
2,110,511
|
|
1,856,672
|
|
1,718,791
|
Goodwill and intangible
assets
|
1,784,000
|
|
1,790,943
|
|
1,624,932
|
Other assets
|
1,650,384
|
|
1,905,616
|
|
1,764,895
|
Total
assets
|
$
18,538,457
|
|
$
18,781,643
|
|
$
18,721,282
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current portion of
long-term debt and finance lease obligations
|
$
3,861
|
|
$
8,358
|
|
$
7,110
|
Other current
liabilities
|
4,243,316
|
|
4,176,560
|
|
5,046,272
|
Total current
liabilities
|
4,247,177
|
|
4,184,918
|
|
5,053,382
|
Long-term debt and
finance lease obligations
|
4,980,460
|
|
5,003,183
|
|
4,996,363
|
Income taxes
payable
|
780,511
|
|
882,084
|
|
840,214
|
Other long-term
liabilities
|
482,979
|
|
501,286
|
|
418,756
|
Total
liabilities
|
10,491,127
|
|
10,571,471
|
|
11,308,715
|
Stockholders' equity
(2)
|
8,047,330
|
|
8,210,172
|
|
7,412,567
|
Total liabilities and
stockholders' equity
|
$
18,538,457
|
|
$
18,781,643
|
|
$
18,721,282
|
|
|
|
|
|
|
(1)
|
Derived from audited
financial statements.
|
(2)
|
Common shares issued
and outstanding were 132,072 as of September 24, 2023, 133,297
as of June 25, 2023, and 136,374 as of September 25,
2022.
|
LAM RESEARCH
CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands,
unaudited)
|
|
|
Three Months
Ended
|
|
September
24,
2023
|
|
June 25,
2023
|
|
September
25,
2022
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
Net income
|
$
887,398
|
|
$
802,537
|
|
$
1,425,879
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
90,479
|
|
89,604
|
|
75,751
|
Deferred income
taxes
|
(24,238)
|
|
(38,960)
|
|
(133,616)
|
Equity-based
compensation expense
|
67,211
|
|
68,495
|
|
71,110
|
Other, net
|
(150)
|
|
40,761
|
|
(2,751)
|
Changes in operating
assets and liabilities
|
(69,537)
|
|
160,288
|
|
(246,785)
|
Net cash provided by
operating activities
|
951,163
|
|
1,122,725
|
|
1,189,588
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
Capital expenditures
and intangible assets
|
(76,992)
|
|
(78,670)
|
|
(140,063)
|
Net maturities and
sales of available-for-sale securities
|
7,275
|
|
26,280
|
|
14,695
|
Other, net
|
(4,966)
|
|
(2,790)
|
|
(2,435)
|
Net cash used for
investing activities
|
(74,683)
|
|
(55,180)
|
|
(127,803)
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
Principal payments on
debt, including finance lease obligations
|
(253,109)
|
|
(2,061)
|
|
(1,854)
|
Treasury stock
purchases
|
(843,238)
|
|
(869,014)
|
|
(109,779)
|
Dividends
paid
|
(230,332)
|
|
(232,336)
|
|
(205,615)
|
Reissuance of treasury
stock related to employee stock purchase plan
|
—
|
|
64,903
|
|
—
|
Proceeds from issuance
of common stock
|
2,818
|
|
3,438
|
|
6,796
|
Other, net
|
(2,151)
|
|
(2,916)
|
|
(489)
|
Net cash used for
financing activities
|
(1,326,012)
|
|
(1,037,986)
|
|
(310,941)
|
Effect of exchange rate
changes on cash, cash equivalents, and restricted cash
|
(11,031)
|
|
1,477
|
|
(16,925)
|
Net (decrease) increase
in cash, cash equivalents, and restricted cash
|
(460,563)
|
|
31,036
|
|
733,919
|
Cash, cash equivalents,
and restricted cash at beginning of period (1)
|
5,587,372
|
|
5,556,336
|
|
3,773,535
|
Cash, cash equivalents,
and restricted cash at end of period (1)
|
$
5,126,809
|
|
$
5,587,372
|
|
$
4,507,454
|
|
|
|
|
|
|
(1)
|
Restricted cash is
reported within Other assets, in the Condensed Consolidated Balance
Sheets
|
Non-GAAP Financial
Summary
(in thousands,
except percentages and per share data)
(unaudited)
|
|
|
Three Months
Ended
|
|
September
24,
2023
|
|
June 25,
2023
|
Revenue
|
$
3,482,062
|
|
$
3,207,257
|
Gross margin
|
$
1,669,469
|
|
$
1,465,207
|
Gross margin as
percentage of revenue
|
47.9 %
|
|
45.7 %
|
Operating
expenses
|
$
622,219
|
|
$
589,914
|
Operating
income
|
$
1,047,250
|
|
$
875,293
|
Operating income as a
percentage of revenue
|
30.1 %
|
|
27.3 %
|
Net income
|
$
912,439
|
|
$
803,125
|
Net income per diluted
share
|
$
6.85
|
|
$
5.98
|
Shares used in per
share calculation - diluted
|
133,166
|
|
134,392
|
Reconciliation of
U.S. GAAP Net Income to Non-GAAP Net Income
(in thousands,
except per share data)
(unaudited)
|
|
|
Three Months
Ended
|
|
September
24,
2023
|
|
June 25,
2023
|
U.S. GAAP net
income
|
$
887,398
|
|
$
802,537
|
Pre-tax non-GAAP
items:
|
|
|
|
Amortization related
to intangible assets acquired through certain business combinations
- cost of goods sold
|
3,149
|
|
3,093
|
Elective deferred
compensation ("EDC") related liability valuation (decrease)
increase - cost of goods sold
|
(591)
|
|
4,288
|
Restructuring charges,
net - cost of goods sold
|
7,940
|
|
11,446
|
Product
rationalization - cost of goods sold
|
—
|
|
(13,383)
|
Transformational costs
- cost of goods sold
|
4,269
|
|
1,634
|
EDC related liability
valuation (decrease) increase - research and development
|
(1,064)
|
|
7,719
|
Product
rationalization - research and development
|
—
|
|
(3,795)
|
Amortization related
to intangible assets acquired through certain business combinations
- selling, general and
administrative
|
1,186
|
|
1,395
|
EDC related liability
valuation (decrease) increase - selling, general and
administrative
|
(709)
|
|
5,146
|
Product
rationalization - selling, general and administrative
|
—
|
|
(2,891)
|
Transformational costs
- selling, general and administrative
|
8,020
|
|
4,294
|
Restructuring charges,
net - operating expenses
|
2,021
|
|
1,742
|
Amortization of note
discounts - other income (expense), net
|
1,017
|
|
724
|
Loss (gain) on EDC
related asset - other income (expense), net
|
2,901
|
|
(16,599)
|
Net income tax benefit
on non-GAAP items
|
(3,098)
|
|
(1,146)
|
Income tax benefit on
the conclusion of certain tax matters
|
—
|
|
(3,079)
|
Non-GAAP net
income
|
$
912,439
|
|
$
803,125
|
Non-GAAP net income per
diluted share
|
$
6.85
|
|
$
5.98
|
U.S. GAAP net income
per diluted share
|
$
6.66
|
|
$
5.97
|
U.S. GAAP and non-GAAP
number of shares used for per diluted share calculation
|
133,166
|
|
134,392
|
Reconciliation of
U.S. GAAP Gross Margin, Operating Expenses and Operating Income to
Non-GAAP Gross Margin,
Operating Expenses and Operating Income
(in thousands,
except percentages)
(unaudited)
|
|
|
Three Months
Ended
|
|
September
24,
2023
|
|
June 25,
2023
|
U.S. GAAP gross
margin
|
$
1,654,702
|
|
$
1,458,129
|
Pre-tax non-GAAP
items:
|
|
|
|
Amortization related
to intangible assets acquired through certain business
combinations
|
3,149
|
|
3,093
|
EDC related liability
valuation (decrease) increase
|
(591)
|
|
4,288
|
Restructuring charges,
net
|
7,940
|
|
11,446
|
Product
rationalization
|
—
|
|
(13,383)
|
Transformational
costs
|
4,269
|
|
1,634
|
Non-GAAP gross
margin
|
$
1,669,469
|
|
$
1,465,207
|
U.S. GAAP gross margin
as a percentage of revenue
|
47.5 %
|
|
45.5 %
|
Non-GAAP gross margin
as a percentage of revenue
|
47.9 %
|
|
45.7 %
|
U.S. GAAP operating
expenses
|
$
631,673
|
|
$
603,524
|
Pre-tax non-GAAP
items:
|
|
|
|
Amortization related
to intangible assets acquired through certain business
combinations
|
(1,186)
|
|
(1,395)
|
EDC related liability
valuation decrease (increase)
|
1,773
|
|
(12,865)
|
Restructuring charges,
net
|
(2,021)
|
|
(1,742)
|
Product
rationalization
|
—
|
|
6,686
|
Transformational
costs
|
(8,020)
|
|
(4,294)
|
Non-GAAP operating
expenses
|
$
622,219
|
|
$
589,914
|
U.S. GAAP operating
income
|
$
1,023,029
|
|
$
854,605
|
Non-GAAP operating
income
|
$
1,047,250
|
|
$
875,293
|
U.S. GAAP operating
income as percent of revenue
|
29.4 %
|
|
26.6 %
|
Non-GAAP operating
income as a percent of revenue
|
30.1 %
|
|
27.3 %
|
Lam Research Corporation Contacts:
Tina Correia, Investor Relations, phone:
510-572-1615, e-mail: investor.relations@lamresearch.com
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SOURCE Lam Research Corporation