FREMONT, Calif., Jul 28, 2010 (BUSINESS WIRE) -- Lam Research Corporation (NASDAQ: LRCX) highlights for the June 2010 quarter were:
Lam Research Corporation | ||||||||
Financial Highlights for the Quarter Ended June 27, 2010 | ||||||||
(in thousands, except per share data and percentages) | ||||||||
U.S. GAAP | Ongoing | |||||||
- Revenue: | $ | 695,289 | $ | 695,289 | ||||
- Operating Margin: | 22.4 | % | 24.8 | % | ||||
- Net Income: | $ | 139,997 | $ | 149,070 | ||||
- Diluted EPS: | $ | 1.10 | $ | 1.17 | ||||
Lam Research Corporation today announced financial results for the quarter ended June 27, 2010. Revenue for the period was $695.3 million, gross margin was $321.4 million and net income was $140.0 million, or $1.10 per diluted share, compared to revenue of $632.8 million, gross margin of $292.9 million and net income of $120.3 million, or $0.94 per diluted share, for the March 2010 quarter. Shipments for the June 2010 quarter were $694 million compared to $735 million during the March 2010 quarter.
The Company's ongoing results for the June 2010 quarter exclude certain costs for restructuring activities and asset impairments. There were no adjustments to U.S. GAAP results to determine ongoing results for the March 2010 quarter. Management uses the presentation of ongoing gross margin, ongoing operating expenses, ongoing operating income, ongoing operating margin, ongoing net income, and ongoing net income per diluted share to evaluate the Company's operating and financial results. The Company believes the presentation of ongoing results is useful to investors for analyzing business trends and comparing performance to prior periods, along with enhancing the investor's ability to view the Company's results from management's perspective. A table presenting a reconciliation of ongoing results to results under U.S. GAAP is included at the end of this press release and on the Company's web site at http://investor.lamrc.com.
Ongoing net income was $149.1 million, or $1.17 per diluted share in the June 2010 quarter compared to ongoing net income of $120.3 million, or $0.94 per diluted share, for the March 2010 quarter. Ongoing gross margin for the June 2010 quarter was $324.9 million or 46.7%, compared to ongoing gross margin of $292.9 million, or 46.3%, for the March 2010 quarter. The sequential increase in gross margin was primarily due to improved factory and field utilization and a more favorable product mix. Ongoing operating expenses for the June 2010 quarter increased to $152.4 million compared with the March 2010 quarter of $143.8 million. This change is a result of higher R&D spending related to customer penetration activities associated with new products and increased variable compensation resulting from improved overall financial performance.
The geographic distribution of shipments and revenue during the June 2010 quarter is shown in the following table:
Region | Shipments | Revenue | ||||||
North America | 8% | 8% | ||||||
Europe | 10% | 7% | ||||||
Japan | 22% | 17% | ||||||
Korea | 29% | 27% | ||||||
Taiwan | 23% | 33% | ||||||
Asia Pacific | 8% | 8% | ||||||
Cash and cash equivalents, short-term investments and restricted cash and investments balances were $991.7 million at the end of the June 2010 quarter, compared to $843.8 million at the end of the March 2010 quarter. Cash flows from operating activities were approximately $165.4 million during the June 2010 quarter. Deferred revenue and deferred profit balances at the end of the June 2010 quarter were $207.4 million and $123.2 million, respectively. Lam's deferred revenue balance does not include shipments to Japanese customers, to whom title does not transfer until customer acceptance. Shipments to Japanese customers are classified as inventory at cost until the time of acceptance. The anticipated future revenue from shipments to Japanese customers was approximately $52 million as of June 27, 2010.
"Market share gains and solid execution drove strong results for the June quarter," said Steve Newberry, Lam's president and chief executive officer. "We believe that we will achieve substantial shipped market share gains in both the etch and clean businesses for calendar year 2010. We continued to win important new applications in the first half of 2010 in both businesses."
"We are committed to creating value for our customers and shareholders and believe that we are demonstrating the results of that commitment through our business and financial performance," Newberry concluded.
Statements made in this press release that are not statements 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, but are not limited, to the anticipated revenue from shipments to Japanese customers and continued market share gains for both the etch and clean businesses. Some factors that may affect these forward-looking statements include: business conditions in the semiconductor industry and the overall economy; the strength of the financial performance of our existing and prospective customers; the introduction of new and innovative technologies; the occurrence and pace of technology transitions and conversions; the actions of our competitors, consumers, semiconductor companies and key suppliers and subcontractors; and the success of research and development and sales and marketing programs. These forward-looking statements are based on current expectations and are subject to uncertainties and changes in condition, significance, value and effect as well as other risks detailed in documents filed by us with the Securities and Exchange Commission, including specifically our report on Form 10-K for the year ended June 28, 2009 and the reports on Form 10-Q for the three months ended September 27, 2009, December 27, 2009, and March 28, 2010. These uncertainties and changes could cause actual results to vary from expectations. The Company undertakes no obligation to update the information or statements made in this press release.
Lam Research Corporation is a major provider of wafer fabrication equipment and services to the world's semiconductor industry. Lam's common stock trades on The NASDAQ Global Select Market SM under the symbol LRCX. Lam is a NASDAQ-100(R) company. For more information, visit www.lamresearch.com.
LAM RESEARCH CORPORATION | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||||||||
(in thousands, except per share data and percentages) | |||||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||
June 27, | March 28, | June 28, | June 27, | June 28, | |||||||||||||||||
2010 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (1) | |||||||||||||||||
Total revenue | $ | 695,289 | $ | 632,763 | $ | 217,764 | $ | 2,133,776 | $ | 1,115,946 | |||||||||||
Cost of goods sold | 370,409 | 339,892 | 150,007 | 1,166,219 | 706,219 | ||||||||||||||||
Cost of goods sold - restructuring and asset impairments | 3,438 | - | - | 3,438 | 20,993 | ||||||||||||||||
Cost of goods sold - 409A expense | - | - | - | (10,168 | ) | - | |||||||||||||||
Total costs of goods sold | 373,847 | 339,892 | 150,007 | 1,159,489 | 727,212 | ||||||||||||||||
Gross margin | 321,442 | 292,871 | 67,757 | 974,287 | 388,734 | ||||||||||||||||
Gross margin as a percent of revenue | 46.2 | % | 46.3 | % | 31.1 | % | 45.7 | % | 34.8 | % | |||||||||||
Research and development | 85,644 | 81,845 | 67,491 | 320,859 | 288,269 | ||||||||||||||||
Selling, general and administrative | 66,779 | 61,933 | 47,248 | 240,942 | 233,061 | ||||||||||||||||
Goodwill impairment | - | - | 7,179 | - | 96,255 | ||||||||||||||||
Restructuring and asset impairments | 13,302 | - | 5,396 | 21,314 | 44,513 | ||||||||||||||||
409A expense | - | - | 982 | (34,238 | ) | 3,232 | |||||||||||||||
Legal judgment | - | - | 4,647 | - | 4,647 | ||||||||||||||||
Total operating expenses | 165,725 | 143,778 | 132,943 | 548,877 | 669,977 | ||||||||||||||||
Operating income (loss) | 155,717 | 149,093 | (65,186 | ) | 425,410 | (281,243 | ) | ||||||||||||||
Operating margin as a percent of revenue | 22.4 | % | 23.6 | % | -29.9 | % | 19.9 | % | -25.2 | % | |||||||||||
Other income, net | 3,541 | 1,616 | 2,869 | 4,731 | 18,150 | ||||||||||||||||
Income (loss) before income taxes | 159,258 | 150,709 | (62,317 | ) | 430,141 | (263,093 | ) | ||||||||||||||
Income tax expense | 19,261 | 30,408 | 26,173 | 83,472 | 39,055 | ||||||||||||||||
Net income (loss) | $ | 139,997 | $ | 120,301 | $ | (88,490 | ) | $ | 346,669 | $ | (302,148 | ) | |||||||||
Net income (loss) per share: | |||||||||||||||||||||
Basic net income (loss) per share | $ | 1.11 | $ | 0.94 | $ | (0.70 | ) | $ | 2.73 | $ | (2.41 | ) | |||||||||
Diluted net income (loss) per share | $ | 1.10 | $ | 0.94 | $ | (0.70 | ) | $ | 2.71 | $ | (2.41 | ) | |||||||||
Number of shares used in per share calculations: | |||||||||||||||||||||
Basic | 126,339 | 127,307 | 126,273 | 126,933 | 125,595 | ||||||||||||||||
Diluted | 127,786 | 128,587 | 126,273 | 128,126 | 125,595 |
1 | Derived from audited financial statements |
LAM RESEARCH CORPORATION | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(in thousands) | ||||||||||
June 27, | March 28, | June 28, | ||||||||
2010 | 2010 | 2009 | ||||||||
(unaudited) | (unaudited) | (1) | ||||||||
ASSETS | ||||||||||
Cash and cash equivalents | $ | 545,767 | $ | 461,369 | $ | 374,167 | ||||
Short-term investments | 280,690 | 217,178 | 205,221 | |||||||
Accounts receivable, net | 499,890 | 521,810 | 253,585 | |||||||
Inventories | 318,479 | 281,469 | 233,410 | |||||||
Deferred income taxes | 46,158 | 49,363 | 69,043 | |||||||
Other current assets | 65,677 | 73,546 | 101,714 | |||||||
Total current assets | 1,756,661 | 1,604,735 | 1,237,140 | |||||||
Property and equipment, net | 200,336 | 203,037 | 215,666 | |||||||
Restricted cash and investments | 165,234 | 165,284 | 178,439 | |||||||
Deferred income taxes | 26,218 | 14,380 | 17,007 | |||||||
Goodwill and intangible assets | 236,906 | 242,868 | 260,787 | |||||||
Other assets | 102,037 | 94,055 | 84,145 | |||||||
Total assets | $ | 2,487,392 | $ | 2,324,359 | $ | 1,993,184 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
Current liabilities | $ | 558,657 | $ | 533,361 | $ | 382,076 | ||||
Long-term debt and capital leases | $ | 17,645 | $ | 20,314 | $ | 40,886 | ||||
Income taxes payable | 110,462 | 113,364 | 102,999 | |||||||
Other long-term liabilities | 32,493 | 12,872 | 14,134 | |||||||
Stockholders' equity | 1,768,135 | 1,644,448 | 1,453,089 | |||||||
Total liabilities and stockholders' equity | $ | 2,487,392 | $ | 2,324,359 | $ | 1,993,184 |
1 | Derived from audited financial statements |
LAM RESEARCH CORPORATION | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||
June 27, | March 28, | June 28, | June 27, | June 28, | |||||||||||||||||
2010 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (1) | |||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||||||||
Net income (loss) | $ | 139,997 | $ | 120,301 | $ | (88,490 | ) | $ | 346,669 | $ | (302,148 | ) | |||||||||
Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities: |
|||||||||||||||||||||
Depreciation and amortization | 17,664 | 17,872 | 17,694 | 71,401 | 72,417 | ||||||||||||||||
Deferred income taxes | (8,633 | ) | 640 | 19,913 | 13,718 | 30,545 | |||||||||||||||
Restructuring charges, net | 16,740 | - | 5,396 | 24,752 | 65,506 | ||||||||||||||||
Goodwill impairment | - | - | 7,179 | - | 96,255 | ||||||||||||||||
Equity-based compensation expense | 12,329 | 10,917 | 13,358 | 50,463 | 53,042 | ||||||||||||||||
Income tax benefit on equity-based compensation plans | 9,944 | 477 | (1,173 | ) | 10,635 | (14,294 | ) | ||||||||||||||
Excess tax benefit on equity-based compensation plans | (9,261 | ) | (370 | ) | (237 | ) | (10,234 | ) | 6,273 | ||||||||||||
Other, net | 648 | 1,210 | 2,535 | 3,190 | 9,353 | ||||||||||||||||
Changes in operating asset and liabilities: | (13,995 | ) | (41,781 | ) | (34,295 | ) | (159,881 | ) | (95,078 | ) | |||||||||||
Net cash provided by (used for) operating activities | 165,433 | 109,266 | (58,120 | ) | 350,713 | (78,129 | ) | ||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||||||||
Capital expenditures and intangible assets | (12,042 | ) | (10,823 | ) | (5,848 | ) | (35,590 | ) | (44,282 | ) | |||||||||||
Acquisitions of businesses, net of cash acquired | - | - | - | - | (19,457 | ) | |||||||||||||||
Net sales/maturities (purchases) of available-for-sale securities | (63,958 | ) | (3,238 | ) | 93,056 | (77,987 | ) | 173,764 | |||||||||||||
Purchase of other investments | (1,223 | ) | - | - | (2,184 | ) | (3,439 | ) | |||||||||||||
Transfer of restricted cash and investments | 50 | 19,629 | (44,458 | ) | 13,205 | (92,206 | ) | ||||||||||||||
Other | (800 | ) | - | 2,000 | (800 | ) | (8,375 | ) | |||||||||||||
Net cash provided by (used for) investing activities | (77,973 | ) | 5,568 | 44,750 | (103,356 | ) | 6,005 | ||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||||||||
Principal payments on long-term debt and capital lease obligations | (616 | ) | (17,820 | ) | (911 | ) | (21,040 | ) | (256,047 | ) | |||||||||||
Net proceeds from issuance of long-term debt | - | - | - | 336 | 625 | ||||||||||||||||
Excess tax benefit on equity-based compensation plans | 9,261 | 370 | 237 | 10,234 | (6,273 | ) | |||||||||||||||
Treasury stock purchases | (17,860 | ) | (72,240 | ) | (3,197 | ) | (93,032 | ) | (30,946 | ) | |||||||||||
Reissuances of treasury stock | 6,173 | 5,518 | 6,271 | 17,452 | 19,797 | ||||||||||||||||
Proceeds from issuance of common stock | 5,563 | 1,441 | 6,287 | 13,386 | 12,014 | ||||||||||||||||
Net cash provided by (used for) financing activities | 2,521 | (82,731 | ) | 8,687 | (72,664 | ) | (260,830 | ) | |||||||||||||
Effect of exchange rate changes on cash | (5,583 | ) | (900 | ) | 4,202 | (3,093 | ) | (25,416 | ) | ||||||||||||
Net increase (decrease) in cash and cash equivalents | 84,398 | 31,203 | (481 | ) | 171,600 | (358,370 | ) | ||||||||||||||
Cash and cash equivalents at beginning of period | 461,369 | 430,166 | 374,648 | 374,167 | 732,537 | ||||||||||||||||
Cash and cash equivalents at end of period | $ | 545,767 | $ | 461,369 | $ | 374,167 | $ | 545,767 | $ | 374,167 |
1 | Derived from audited financial statements |
Reconciliation of U.S. GAAP Net Income to Ongoing Net Income | |||||||||
(in thousands, except per share data) | |||||||||
(unaudited) | |||||||||
Three Months Ended | Three Months Ended | ||||||||
June 27, | March 28, | ||||||||
2010 | 2010 | ||||||||
U.S. GAAP net income | $ | 139,997 | $ | 120,301 | |||||
Pre-tax non-ongoing items: | |||||||||
Restructuring and asset impairments - cost of goods sold | 3,438 | - | |||||||
Restructuring and asset impairments - operating expenses | 13,302 | - | |||||||
Net tax (benefit) on non-ongoing items | (7,667 | ) | - | ||||||
Ongoing net income | $ | 149,070 | $ | 120,301 | |||||
Ongoing net income per diluted share | $ | 1.17 | $ | 0.94 | |||||
Number of shares used for diluted per share calculation | 127,786 | 128,587 | |||||||
Reconciliation of U.S. GAAP Gross Margin, Operating Expenses and Operating Income to Ongoing Gross Margin, |
|||||||||
(in thousands, except percentages) | |||||||||
(unaudited) | |||||||||
Three Months Ended | Three Months Ended | ||||||||
June 27, | March 28, | ||||||||
2010 | 2010 | ||||||||
U.S. GAAP gross margin | $ | 321,442 | $ | 292,871 | |||||
Pre-tax non-ongoing items: | |||||||||
Restructuring and asset impairments - cost of goods sold | 3,438 | - | |||||||
Ongoing gross margin | $ | 324,880 | $ | 292,871 | |||||
U.S. GAAP gross margin as a percent of revenue | 46.2 | % | 46.3 | % | |||||
Ongoing gross margin as a percent of revenue | 46.7 | % | 46.3 | % | |||||
U.S. GAAP operating expenses | $ | 165,725 | $ | 143,778 | |||||
Pre-tax non-ongoing items: | |||||||||
Restructuring and asset impairments - operating expenses | (13,302 | ) | - | ||||||
Ongoing operating expenses | $ | 152,423 | $ | 143,778 | |||||
Ongoing operating income | $ | 172,457 | $ | 149,093 | |||||
Ongoing operating margin as a percent of revenue | 24.8 | % | 23.6 | % |
SOURCE: Lam Research Corporation
Lam Research Corporation Carol Raeburn, 510-572-4450 Managing Director, Investor Relations carol.raeburn@lamresearch.com
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