FREMONT, Calif., April 22, 2020 (GLOBE NEWSWIRE) — Lam Research Corporation (the “Company,” “Lam,” “Lam Research”) today announced financial results for the quarter ended March 29, 2020 (the “March 2020 quarter”).
Highlights for the March 2020 quarter were as follows:Revenue of $2.50 billion.U.S. GAAP gross margin of 46.6%, U.S. GAAP operating income as a percentage of revenue of 27.7%, and U.S. GAAP diluted EPS of $3.88.Non-GAAP gross margin of 46.3%, non-GAAP operating income as a percentage of revenue of 26.9%, and non-GAAP diluted EPS of $3.98.Key Financial Data for the Quarters Ended
March 29, 2020 and December 29, 2019
(in thousands, except per-share data, percentages, and basis points)U.S. GAAP Financial ResultsFor the March 2020 quarter, revenue was $2,504 million, gross margin was $1,167 million, or 46.6% of revenue, operating expenses were $473 million, operating income was 27.7% of revenue, and net income was $575 million, or $3.88 per diluted share on a U.S. GAAP basis. This compares to revenue of $2,584 million, gross margin of $1,180 million, or 45.7% of revenue, operating expenses of $493 million, operating income of 26.6% of revenue, and net income of $515 million, or $3.43 per diluted share, for the quarter ended December 29, 2019 (the “December 2019 quarter”).Non-GAAP Financial ResultsFor the March 2020 quarter, non-GAAP gross margin was $1,160 million, or 46.3% of revenue, non-GAAP operating expenses were $486 million, non-GAAP operating income was 26.9% of revenue, and non-GAAP net income was $590 million, or $3.98 per diluted share. This compares to non-GAAP gross margin of $1,181 million, or 45.7% of revenue, non-GAAP operating expenses of $481 million, non-GAAP operating income of 27.1% of revenue, and non-GAAP net income of $602 million, or $4.01 per diluted share, for the December 2019 quarter.“Extraordinary efforts by Lam’s global teams helped to mitigate the operational impact of the COVID-19 pandemic, resulting in solid financial performance in the March quarter,” said Tim Archer, Lam Research’s President and Chief Executive Officer. “While there is limited visibility to near-term macroeconomic conditions and industry supply chain recovery, customer demand for our equipment remains strong. We believe in the long-term resiliency of the semiconductor industry and are focused on providing innovative technology to our customers and positioning Lam for outperformance as industry conditions normalize.”Balance Sheet and Cash Flow ResultsCash and cash equivalents, short-term investments, and restricted cash and investments balances increased to $5.6 billion at the end of the March 2020 quarter compared to $4.9 billion at the end of the December 2019 quarter. This increase was primarily the result of a $1.25 billion draw down on the Company’s revolving credit facility and $541.4 million of cash generated from operating activities. These sources of cash were partially offset by $617.6 million of principal payments on debt; $245.4 million of share repurchases, including net share settlement on employee stock-based compensation; $163.5 million of dividends paid to stockholders; and $51.4 million of capital expenditures.RevenueThe geographic distribution of revenue during the March 2020 quarter is shown in the following table:The following table presents revenue disaggregated between system and customer support-related revenue:System 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.Use of Non-GAAP Financial ResultsIn addition to U.S. GAAP results, this press release also contains non-GAAP financial results. The Company’s non-GAAP results for both the March 2020 and December 2019 quarters exclude amortization related to intangible assets acquired through business combinations, amortization of note discounts, and income tax expense (benefit) of non-GAAP items. Additionally, the March 2020 quarter non-GAAP results exclude the effects of elective deferred compensation-related assets and liabilities. To enhance the comparability relative to the prior period, the Company has included reconciliation of both the originally-reported December 2019 quarter non-GAAP results, and recast December 2019 quarter non-GAAP results that conform to the current presentation with respect to the effects of elective deferred compensation-related assets and liabilities, in the reconciliation tables at the end of this press release. The March 2020 quarter non-GAAP results also exclude the income tax benefit on conclusion of certain tax matters related to a prior business combination; and the December 2019 quarter non-GAAP results exclude the cumulative income tax benefit reversal due to the Ninth Circuit decision to deny a rehearing of the Altera stock-based compensation case.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 http://investor.lamresearch.com. Caution Regarding Forward-Looking StatementsStatements 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: the impact of the COVID-19 outbreak on our operations and financial results; macroeconomic conditions; the status of the industry supply chain; customer demand for our equipment; industry conditions; the long–term resiliency of the semiconductor industry; the relevance of our technology to our customers; our positioning within the industry; and our ability to outperform. Some factors that may affect these forward-looking statements include: the severity, magnitude and duration of the COVID–19 pandemic (and the related governmental, public health, business and community responses to it), and their impacts on our business, results of operations and financial condition, are evolving and are highly uncertain and unpredictable; 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; and widespread outbreaks of illness 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 30, 2019, our quarterly reports on Form 10–Q for the fiscal quarters ended September 29, 2019 and December 29, 2019, and our current report of Form 8–K dated April 22, 2020. 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.About Lam ResearchLam Research Corporation is a global supplier of innovative wafer fabrication equipment and services to the semiconductor industry. As a trusted, collaborative partner to the world’s leading semiconductor companies, we combine superior systems engineering capability, technology leadership, and unwavering commitment to customer success to accelerate innovation through enhanced device performance. In fact, today, nearly every advanced chip is built with Lam technology. 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
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LAM RESEARCH CORPORATION
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(unaudited)Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income
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(unaudited)Lam Research Corporation Contacts:Tina Correia, Investor Relations, phone: 510-572-1615, e-mail: [email protected]
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