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Sector
Technology
Size
Large Cap
Market Cap £61.32bn
Enterprise Value £60.78bn
Revenue £10.71bn
Position in Universe 148th / 7157

Lam Research Corporation Reports Financial Results for the Quarter Ended June 27, 2021

Wed 28th July, 2021 9:05pm
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FREMONT, Calif., July 28, 2021 (GLOBE NEWSWIRE) -- Lam Research Corporation
(the "Company," "Lam," "Lam Research") today announced financial results for
the quarter ended June 27, 2021 (the “June 2021 quarter”).

Highlights for the June 2021 quarter were as follows:
* Revenue of $4.15 billion.
* U.S. GAAP gross margin of 46.2%, U.S. GAAP operating income as a percentage
of revenue of 31.7%, and U.S. GAAP diluted EPS of $7.98.
* Non-GAAP gross margin of 46.5%, non-GAAP operating income as a percentage of
revenue of 32.6%, and non-GAAP diluted EPS of $8.09.
Key Financial Data for the Quarters Ended 
June 27, 2021 and March 28, 2021 
(in thousands, except per-share data, percentages, and basis points) 

 U.S. GAAP                                                                                                      
                                              June 2021                March 2021               Change Q/Q      
 Revenue                                      $     4,145,179          $     3,847,654          +8%             
 Gross margin as percentage of revenue        46.2             %       46.3             %       - 10 bps        
 Operating income as percentage of revenue    31.7             %       31.1             %       + 60 bps        
 Diluted EPS                                  $     7.98               $     7.41               +8%             
                                                                                                                
 Non-GAAP                                                                                                       
                                              June 2021                March 2021               Change Q/Q      
 Revenue                                      $     4,145,179          $     3,847,654          +8%             
 Gross margin as percentage of revenue        46.5             %       46.3             %       + 20 bps        
 Operating income as percentage of revenue    32.6             %       31.6             %       + 100 bps       
 Diluted EPS                                  $     8.09               $     7.49               +8%             

U.S. GAAP Financial Results

For the June 2021 quarter, revenue was $4,145 million, gross margin was $1,915
million, or 46.2% of revenue, operating expenses were $599 million, operating
income was 31.7% of revenue, and net income was $1,145 million, or $7.98 per
diluted share on a U.S. GAAP basis. This compares to revenue of $3,848
million, gross margin of $1,780 million, or 46.3% of revenue, operating
expenses of $585 million, operating income of 31.1% of revenue, and net income
of $1,071 million, or $7.41 per diluted share, for the quarter ended March 28,
2021 (the “March 2021 quarter”).

Non-GAAP Financial Results

For the June 2021 quarter, non-GAAP gross margin was $1,926 million, or 46.5%
of revenue, non-GAAP operating expenses were $574 million, non-GAAP operating
income was 32.6% of revenue, and non-GAAP net income was $1,161 million, or
$8.09 per diluted share. This compares to non-GAAP gross margin of $1,783
million, or 46.3% of revenue, non-GAAP operating expenses of $567 million,
non-GAAP operating income of 31.6% of revenue, and non-GAAP net income of
$1,084 million, or $7.49 per diluted share, for the March 2021 quarter.

“Lam continued its record performance in the June quarter, capping a fiscal
2021 with more than 45% revenue growth and an increase of over 70% in earnings
per share,” said Tim Archer, Lam Research’s President and Chief Executive
Officer. “The combination of strong semiconductor demand and rising device
complexity is driving higher levels of wafer fabrication equipment investment.
Our technology differentiation and deep collaboration with customers position
Lam to extend our leadership across all market segments.”

Balance Sheet and Cash Flow Results

Cash and cash equivalents, short-term investments, and restricted cash and
investments balances remained flat at $6.0 billion at the end of the June 2021
quarter compared to the end of the March 2021 quarter. Cash generated from
operating activities totaling $1,435.9 million was offset by repayment of
$822.0 million of borrowings; $431.3 million of share repurchases, including
net share settlement on employee stock-based compensation; and $185.4 million
of dividends paid to stockholders.

Revenue

The geographic distribution of revenue during the June 2021 quarter is shown
in the following table:

 Region          Revenue  
 China           37%      
 Korea           30%      
 Taiwan          13%      
 Japan           9%       
 United States   5%       
 Southeast Asia  3%       
 Europe          3%       

The following table presents revenue disaggregated between system and customer
support-related revenue:

                                             Three Months Ended                                                                   Twelve Months Ended                                      
                                             June 27, 2021                March 28,                   June 28, 2020               June 27, 2021                  June 28, 2020             
                                                                          2021                                                                                                             
                                             (In thousands)                                                                                                                                
 Systems revenue                             $      2,763,877             $      2,545,306            $      1,865,249            $      9,764,845               $      6,625,130          
 Customer support-related revenue and other  1,381,302                    1,302,348                   926,615                     4,861,305                      3,419,606                 
                                             $      4,145,179             $      3,847,654            $      2,791,864            $      14,626,150              $      10,044,736         

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.

Outlook

For the quarter ended September 26, 2021, Lam is providing the following
guidance:

                                              U.S. GAAP                                        Reconciling Items               Non-GAAP                                       
 Revenue                                      $4.3 Billion         +/-  $250 Million           —                               $4.3 Billion         +/-  $250 Million         
 Gross margin as a percentage of revenue             46.0%         +/-         1%              $      1             Million           46.0%         +/-         1%            
 Operating income as a percentage of revenue         31.7%         +/-         1%              $      13            Million           32.0%         +/-         1%            
 Net income per diluted share                        $8.02         +/-         $0.50           $      12            Million           $8.10         +/-         $0.50         
 Diluted share count                          143 Million                                      —                               143 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, gains or losses on equity investments, other investments, or
other significant arrangements that may be completed or realized after the
date of this release. 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 - amortization related to intangible
assets acquired through business combinations, $1 million.
* Operating income as a percentage of revenue - amortization related to
intangible assets acquired through business combinations, $13 million.
* Net income per diluted share - amortization related to intangible assets
acquired though business combinations, $13 million; amortization of note
discounts, $1 million; and associated tax benefit for non-GAAP items ($2
million); totaling $12 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 June 2021 and
March 2021 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,
and the income tax benefit of non-GAAP items. Additionally, the June 2021
quarter non-GAAP results exclude 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 http://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 margins,
operating income and net income; the factors affecting wafer fabrication
equipment investment or the future levels of such investment; the extent to
which our technology is differentiated and the extent to which we will
collaborate with customers; and our ability to maintain or extend our
leadership across any or all market segments. 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; supply chain disruptions or
manufacturing capacity constraints may limit our ability to manufacture and
sell our products; the actions of our customers and competitors may be
inconsistent with our expectations; trade regulations, export controls, trade
disputes, and other geopolitical tensions may inhibit our ability to sell our
products; 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 28, 2020, and
our quarterly reports on Form 10–Q for the fiscal quarters ended September
27, 2020, December 27, 2020 and March 28, 2021. 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. 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
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data and percentages)

                                                   Three Months Ended                                                                                  Twelve Months Ended                                                  
                                                   June 27, 2021                     March 28, 2021                    June 28, 2020                   June 27, 2021                      June 28, 2020                     
                                                   (unaudited)                       (unaudited)                       (unaudited)                     (unaudited)                        (1)                               
 Revenue                                           $      4,145,179                  $      3,847,654                  $      2,791,864                $      14,626,150                  $      10,044,736                 
 Cost of goods sold                                2,229,978                         2,067,523                         1,511,532                       7,820,844                          5,436,043                         
 Gross margin                                      1,915,201                         1,780,131                         1,280,332                       6,805,306                          4,608,693                         
 Gross margin as a percent of revenue              46.2                    %         46.3                    %         45.9                    %       46.5                     %         45.9                    %         
 Research and development                          381,749                           381,120                           338,810                         1,493,408                          1,252,412                         
 Selling, general and administrative               217,525                           203,703                           185,800                         829,875                            682,479                           
 Total operating expenses                          599,274                           584,823                           524,610                         2,323,283                          1,934,891                         
 Operating income                                  1,315,927                         1,195,308                         755,722                         4,482,023                          2,673,802                         
 Operating income as a percent of revenue          31.7                    %         31.1                    %         27.1                    %       30.6                     %         26.6                    %         
 Other expense, net                                (7,166            )               (35,320           )               (7,553            )             (111,219           )               (98,824            )              
 Income before income taxes                        1,308,761                         1,159,988                         748,169                         4,370,804                          2,574,978                         
 Income tax expense                                (164,104          )               (88,867           )               (51,496           )             (462,346           )               (323,225           )              
 Net income                                        $      1,144,657                  $      1,071,121                  $      696,673                  $      3,908,458                   $      2,251,753                  
 Net income per share:                                                                                                                                                                                                      
 Basic                                             $      8.02                       $      7.51                       $      4.79                     $      27.22                       $      15.55                      
 Diluted                                           $      7.98                       $      7.41                       $      4.73                     $      26.90                       $      15.10                      
 Number of shares used in per share calculations:                                                                                                                                                                           
 Basic                                             142,662                           142,676                           145,295                         143,609                            144,814                           
 Diluted                                           143,514                           144,609                           147,416                         145,320                            149,090                           
 Cash dividend declared per common share           $      1.30                       $      1.30                       $      1.15                     $      5.20                        $      4.60                       
                                                                                                                                                                                                                            
 (1) Derived from audited financial statements.                                                                                                                                                                             



LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

                                                                                                                                           June 27, 2021                March 28, 2021               June 28, 2020                   
                                                                                                                                           (unaudited)                  (unaudited)                  (1)                             
 ASSETS                                                                                                                                                                                                                              
 Cash and cash equivalents                                                                                                                 $       4,418,263            $       3,673,366            $       4,915,172               
 Investments                                                                                                                               1,310,872                    2,116,101                    1,795,080                       
 Accounts receivable, net                                                                                                                  3,026,430                    2,809,068                    2,097,099                       
 Inventories                                                                                                                               2,689,294                    2,552,032                    1,900,024                       
 Prepaid expenses and other current assets                                                                                                 207,528                      171,703                      146,160                         
 Total current assets                                                                                                                      11,652,387                   11,322,270                   10,853,535                      
 Property and equipment, net                                                                                                               1,303,479                    1,279,836                    1,071,499                       
 Restricted cash and investments                                                                                                           252,487                      253,460                      253,911                         
 Goodwill and intangible assets                                                                                                            1,622,499                    1,633,254                    1,652,968                       
 Other assets                                                                                                                              1,061,300                    796,093                      727,134                         
 Total assets                                                                                                                              $       15,892,152           $       15,284,913           $       14,559,047              
 LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                                                                
 Current portion of long-term debt and finance lease obligations                                                                           $       11,349               $       825,434              $       839,877                 
 Other current liabilities                                                                                                                 3,516,518                    2,786,899                    2,322,565                       
 Total current liabilities                                                                                                                 3,527,867                    3,612,333                    3,162,442                       
 Long-term debt and finance lease obligations                                                                                              4,990,333                    4,991,613                    4,970,848                       
 Income taxes payable                                                                                                                      948,037                      924,629                      909,709                         
 Other long-term liabilities                                                                                                               398,727                      381,505                      332,559                         
 Total liabilities                                                                                                                         9,864,964                    9,910,080                    9,375,558                       
 Temporary equity, convertible notes                                                                                                       —                            3,217                        10,995                          
 Stockholders’ equity (2)                                                                                                                  6,027,188                    5,371,616                    5,172,494                       
 Total liabilities and stockholders’ equity                                                                                                $       15,892,152           $       15,284,913           $       14,559,047              
                                                                                                                                                                                                                                     
 (1) Derived from audited financial statements.                                                                                                                                                                                      
 (2) Common shares issued and outstanding were 142,501 as of June 27, 2021, 142,607 as of March 28, 2021, and 145,331 as of June 28, 2020                                                                                            



LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

                                                                                    Three Months Ended                                                                                     Twelve Months Ended                                                  
                                                                                    June 27, 2021                      March 28, 2021                     June 28, 2020                    June 27, 2021                      June 28, 2020                     
                                                                                    (unaudited)                        (unaudited)                        (unaudited)                      (unaudited)                        (1)                               
 CASH FLOWS FROM OPERATING ACTIVITIES:                                                                                                                                                                                                                          
 Net income                                                                         1,144,657                          1,071,121                          696,673                          3,908,458                          2,251,753                         
 Adjustments to reconcile net income to net cash provided by operating activities:                                                                                                                                                                              
 Depreciation and amortization                                                      78,397                             79,453                             71,083                           307,151                            268,525                           
 Deferred income taxes                                                              (146,029           )               (1,136             )               (92,293            )             (151,477           )               (17,777            )              
 Equity-based compensation expense                                                  56,321                             55,746                             53,153                           220,164                            189,197                           
 Other, net                                                                         (27,786            )               (635               )               (9,493             )             (17,392            )               6,628                             
 Changes in operating assets and liabilities                                        330,375                            (39,469            )               93,925                           (678,741           )               (571,875           )              
 Net cash provided by operating activities                                          1,435,935                          1,165,080                          813,048                          3,588,163                          2,126,451                         
 CASH FLOWS FROM INVESTING ACTIVITIES:                                                                                                                                                                                                                          
 Capital expenditures and intangible assets                                         (104,622           )               (89,596            )               (50,554            )             (349,096           )               (203,239           )              
 Net sale (purchase) of available-for-sale securities                               799,965                            233,529                            (354,350           )             464,522                            (15,000            )              
 Other, net                                                                         (6,282             )               (27,997            )               (25,305            )             (42,155            )               (25,845            )              
 Net cash provided by (used for) investing activities                               689,061                            115,936                            (430,209           )             73,271                             (244,084           )              
 CASH FLOWS FROM FINANCING ACTIVITIES:                                                                                                                                                                                                                          
 Proceeds from issuance of long-term debt, net of issuance costs                    —                                  —                                  1,974,651                        —                                  1,974,651                         
 Principal payments on debt                                                         (822,046           )               (16,245            )               (2,948             )             (862,060           )               (667,537           )              
 Proceeds from borrowings on revolving credit facility                              —                                  —                                  —                                —                                  1,250,000                         
 Repayments of borrowings on revolving credit facility                              —                                  —                                  (1,250,000         )             —                                  (1,250,000         )              
 Treasury stock purchases                                                           (431,255           )               (1,094,571         )               (41,017            )             (2,697,704         )               (1,369,649         )              
 Dividends paid                                                                     (185,385           )               (186,551           )               (167,739           )             (726,992           )               (656,838           )              
 Reissuance of treasury stock related to employee stock purchase plan               56,330                             —                                  46,992                           97,764                             85,439                            
 Proceeds from issuance of common stock                                             851                                9,626                              1,869                            24,123                             8,084                             
 Other, net                                                                         (269               )               (665               )               1,592                            (2,113             )               1,920                             
 Net cash (used for) provided by financing activities                               (1,381,774         )               (1,288,406         )               563,400                          (4,166,982         )               (623,930           )              
 Effect of exchange rate changes on cash, cash equivalents, and restricted cash     702                                (5,756             )               7,103                            7,215                              (2,750             )              
 Net increase (decrease) in cash, cash equivalents, and restricted cash             743,924                            (13,146            )               953,342                          (498,333           )               1,255,687                         
 Cash, cash equivalents, and restricted cash at beginning of period                 3,926,826                          3,939,972                          4,215,741                        5,169,083                          3,913,396                         
 Cash, cash equivalents, and restricted cash at end of period                       $       4,670,750                  $       3,926,826                  $       5,169,083                $       4,670,750                  $       5,169,083                 
                                                                                                                                                                                                                                                                
 (1) Derived from audited financial statements.                                                                                                                                                                                                                 

                          

Non-GAAP Financial Summary
(in thousands, except percentages and per share data) 
(unaudited)

                                                 Three Months Ended                                     
                                                 June 27, 2021                 March 28, 2021           
 Revenue                                         $      4,145,179              $      3,847,654         
 Gross margin                                    $      1,926,323              $      1,783,209         
 Gross margin as percentage of revenue           46.5              %           46.3              %      
 Operating expenses                              $      573,707                $      566,507           
 Operating income                                $      1,352,616              $      1,216,702         
 Operating income as a percentage of revenue     32.6              %           31.6              %      
 Net income                                      $      1,161,211              $      1,083,532         
 Net income per diluted share                    $      8.09                   $      7.49              
 Shares used in per share calculation - diluted  143,514                       144,609                  



Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income
(in thousands, except per share data)
(unaudited) 

                                                                                                                                Three Months Ended                                             
                                                                                                                                June 27, 2021                     March 28, 2021               
 U.S. GAAP net income                                                                                                           $     1,144,657                   $     1,071,121              
 Pre-tax non-GAAP items:                                                                                                                                                                       
 Amortization related to intangible assets acquired through certain business combinations - cost of goods sold                  1,092                             1,092                        
 Elective deferred compensation ("EDC") related liability valuation increase - cost of goods sold                               4,256                             1,986                        
 Product rationalization - cost of goods sold                                                                                   5,774                             —                            
 EDC related liability valuation increase - research and development                                                            7,661                             3,575                        
 Product rationalization - research and development                                                                             426                               —                            
 Amortization related to intangible assets acquired through certain business combinations -selling, general and administrative  12,357                            12,357                       
 EDC related liability valuation increase - selling, general and administrative                                                 5,123                             2,384                        
 Amortization of note discounts - other expense, net                                                                            923                               998                          
 Gain on EDC related asset - other expense, net                                                                                 (17,184          )                (7,520           )           
 Net income tax benefit on non-GAAP items                                                                                       (3,874           )                (2,461           )           
 Non-GAAP net income                                                                                                            $     1,161,211                   $     1,083,532              
 Non-GAAP net income per diluted share                                                                                          $     8.09                        $     7.49                   
 U.S. GAAP net income per diluted share                                                                                         $     7.98                        $     7.41                   
 U.S. GAAP and non-GAAP number of shares used for per diluted share calculation                                                 143,514                           144,609                      



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                                             
                                                                                           June 27, 2021                     March 28, 2021               
 U.S. GAAP gross margin                                                                    $     1,915,201                   $     1,780,131              
 Pre-tax non-GAAP items:                                                                                                                                  
 Amortization related to intangible assets acquired through certain business combinations  1,092                             1,092                        
 EDC related liability valuation increase                                                  4,256                             1,986                        
 Product rationalization                                                                   5,774                             —                            
 Non-GAAP gross margin                                                                     $     1,926,323                   $     1,783,209              
 U.S. GAAP gross margin as a percentage of revenue                                         46.2                   %          46.3                   %     
 Non-GAAP gross margin as a percentage of revenue                                          46.5                   %          46.3                   %     
 U.S. GAAP operating expenses                                                              $     599,274                     $     584,823                
 Pre-tax non-GAAP items:                                                                                                                                  
 Amortization related to intangible assets acquired through certain business combinations  (12,357          )                (12,357          )           
 EDC related liability valuation increase                                                  (12,784          )                (5,959           )           
 Product rationalization                                                                   (426             )                —                            
 Non-GAAP operating expenses                                                               $     573,707                     $     566,507                
 U.S. GAAP operating income                                                                $     1,315,927                   $     1,195,308              
 Non-GAAP operating income                                                                 $     1,352,616                   $     1,216,702              
 U.S. GAAP operating income as percent of revenue                                          31.7                   %          31.1                   %     
 Non-GAAP operating income as a percent of revenue                                         32.6                   %          31.6                   %     

Lam Research Corporation Contact:

Tina Correia, Investor Relations, phone: 510-572-1615, e-mail:
investor.relations@lamresearch.com

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