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Lam Research Corporation
Financial Highlights for the Quarter Ended June 26,
2011
(in thousands, except per share data and percentages)
U.S. GAAP Non-GAAP
----------- -----------
-- Revenue: $ 752,018 $ 752,018
-- Operating Margin: 18.9% 21.1%
-- Net Income: $ 125,928 $ 142,289
-- Diluted EPS: $ 1.01 $ 1.14
In addition to U.S. Generally Accepted Accounting Principles (GAAP) results, this commentary contains non-GAAP financial measures. The Company's non-GAAP results for the
Non-GAAP net income was
The geographic distribution of shipments and revenue during the
Region Shipments Revenue
------------------------------ ---------- ----------
North America 15% 15%
Europe 12% 11%
Japan 19% 15%
Korea 18% 21%
Taiwan 17% 21%
Asia Pacific 19% 17%
Cash and cash equivalents, short-term investments and restricted cash and investments balances were
"Lam delivered solid operating performance and financial results for the June quarter," said
Caution Regarding Forward-Looking Statements
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 of 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; our future commitment to our current strategic priorities; the return on our R&D investments, the market success of our product portfolio, our cash generation capability, future spending in the wafer fab equipment sector, and our ability to meet customers' future technology needs and our future market position. Some factors that may affect these forward-looking statements include: business conditions in the consumer electronics industry, 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
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 26, March 27, June 27, June 26, June 27,
2011 2011 2010 2011 2010
----------- ----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited) (1)
Total revenue $ 752,018 $ 809,087 $ 695,289 $ 3,237,693 $ 2,133,776
Cost of goods
sold 413,564 435,068 370,409 1,740,461 1,166,219
Cost of goods
sold -
restructuring
and
impairments - - 3,438 - 3,438
Cost of goods
sold - 409A
expense - - - - (5,816)
----------- ----------- ----------- ----------- -----------
Total costs
of goods
sold 413,564 435,068 373,847 1,740,461 1,163,841
----------- ----------- ----------- ----------- -----------
Gross margin 338,454 374,019 321,442 1,497,232 969,935
Gross margin
as a
percent of
revenue 45.0% 46.2% 46.2% 46.2% 45.5%
Research and
development 99,583 96,880 85,644 373,293 320,859
Selling, general
and
administrative 79,938 80,143 66,779 308,075 240,942
Restructuring
and impairments 16,742 - 13,302 11,579 21,314
409A expense - - - - (38,590)
----------- ----------- ----------- ----------- -----------
Total
operating
expenses 196,263 177,023 165,725 692,947 544,525
----------- ----------- ----------- ----------- -----------
Operating
income 142,191 196,996 155,717 804,285 425,410
Operating
margin as a
percent of
revenue 18.9% 24.3% 22.4% 24.8% 19.9%
Other income
(expense), net (5,131) 1,663 3,541 (3,409) 4,731
----------- ----------- ----------- ----------- -----------
Income
before
income
taxes 137,060 198,659 159,258 800,876 430,141
Income tax
expense 11,132 16,419 19,261 77,128 83,472
----------- ----------- ----------- ----------- -----------
Net income $ 125,928 $ 182,240 $ 139,997 $ 723,748 $ 346,669
=========== =========== =========== =========== ===========
Net income per
share:
Basic net
income per
share $ 1.02 $ 1.47 $ 1.11 $ 5.86 $ 2.73
=========== =========== =========== =========== ===========
Diluted net
income per
share $ 1.01 $ 1.45 $ 1.10 $ 5.79 $ 2.71
=========== =========== =========== =========== ===========
Number of shares
used in per
share
calculations:
Basic 123,863 123,674 126,339 123,529 126,933
=========== =========== =========== =========== ===========
Diluted 125,086 125,293 127,786 125,019 128,126
=========== =========== =========== =========== ===========
1 Derived from audited financial statements
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
June 26, March 27, June 27,
2011 2011 2010
------------- ------------- -------------
(unaudited) (unaudited) (1)
ASSETS
Cash and cash equivalents $ 1,492,132 $ 942,710 $ 545,767
Short-term investments 630,115 312,879 280,690
Accounts receivable, net 590,568 637,795 499,890
Inventories 396,607 355,734 318,479
Deferred income taxes 78,435 45,934 46,158
Other current assets 88,935 77,722 65,677
------------- ------------- -------------
Total current assets 3,276,792 2,372,774 1,756,661
Property and equipment, net 270,458 251,954 200,336
Restricted cash and investments 165,256 165,248 165,234
Deferred income taxes 3,892 29,578 26,218
Goodwill and intangible assets 216,616 221,146 236,906
Other assets 124,380 107,795 102,037
------------- ------------- -------------
Total assets $ 4,057,394 $ 3,148,495 $ 2,487,392
============= ============= =============
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities $ 684,286 $ 667,391 $ 558,657
------------- ------------- -------------
Long-term debt and capital leases $ 738,488 $ 15,949 $ 17,645
Income taxes payable 113,582 116,911 110,462
Other long-term liabilities 51,193 25,088 32,493
Stockholders' equity 2,469,845 2,323,156 1,768,135
------------- ------------- -------------
Total liabilities and
stockholders' equity $ 4,057,394 $ 3,148,495 $ 2,487,392
============= ============= =============
1 Derived from audited financial statements
LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended Twelve Months Ended
----------------------------------- -----------------------
June 26, March 27, June 27, June 26, June 27,
2011 2011 2010 2011 2010
----------- ----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited) (1)
CASH FLOWS FROM
OPERATING
ACTIVITIES:
Net income $ 125,928 $ 182,240 $ 139,997 $ 723,748 $ 346,669
Adjustments to
reconcile net
income to net
cash provided
by (used for)
operating
activities:
Depreciation
and
amortization 19,972 18,176 17,664 74,759 71,401
Deferred
income taxes (6,166) (733) (8,633) (10,721) 13,718
Restructuring
charges, net 16,742 - 16,740 11,579 24,752
Non-cash
interest
expense 3,554 - - 3,554 -
Equity-based
compensation
expense 14,788 12,456 12,329 53,012 50,463
Income tax
benefit on
equity-based
compensation
plans 9,283 15,327 9,944 28,775 10,635
Excess tax
benefit on
equity-based
compensation
plans (8,184) (11,878) (9,261) (23,290) (10,234)
Other, net 477 746 648 (2,341) 3,190
Changes in
operating
asset and
liabilities: 21,714 25,259 (13,995) 21,953 (159,881)
----------- ----------- ----------- ----------- -----------
Net cash
provided by
operating
activities 198,108 241,593 165,433 881,028 350,713
----------- ----------- ----------- ----------- -----------
CASH FLOWS FROM
INVESTING
ACTIVITIES:
Capital
expenditures
and intangible
assets (34,571) (35,769) (12,042) (127,495) (35,590)
Net
sales/maturities
(purchases)
of available-
for-sale
securities (316,789) (11,068) (63,958) (353,523) (77,987)
Purchase of
other
investments - (417) (1,223) (417) (2,184)
Proceeds from
sale of assets - - - 1,544 -
Transfer of
restricted cash
and investments (8) (4) 50 (22) 13,205
Other - - (800) - (800)
----------- ----------- ----------- ----------- -----------
Net cash
used for
investing
activities (351,368) (47,258) (77,973) (479,913) (103,356)
----------- ----------- ----------- ----------- -----------
CASH FLOWS FROM
FINANCING
ACTIVITIES:
Principal
payments on
long-term debt
and capital
lease
obligations (81) (1,038) (616) (4,530) (21,040)
Net proceeds
from issuance
of long-term
debt 882,831 - - 882,831 336
Proceeds from
sale of
warrants 133,830 - - 133,830 -
Purchase of
convertible
note hedge (181,125) - - (181,125) -
Excess tax
benefit on
equity-based
compensation
plans 8,184 11,878 9,261 23,290 10,234
Treasury stock
purchases (53,753) (8,617) (17,860) (211,316) (93,032)
Net cash
received in
settlement of
(paid in
advance for)
stock
repurchase
contracts (99,589) - - (149,589) -
Reissuances of
treasury stock 7,518 6,521 6,173 21,194 17,452
Proceeds from
issuance of
common stock 2,179 5,980 5,563 12,401 13,386
----------- ----------- ----------- ----------- -----------
Net cash
provided by
(used for)
financing
activities 699,994 14,724 2,521 526,986 (72,664)
----------- ----------- ----------- ----------- -----------
Effect of
exchange rate
changes on cash 2,688 4,591 (5,583) 18,264 (3,093)
Net increase in
cash and cash
equivalents 549,422 213,650 84,398 946,365 171,600
Cash and cash
equivalents at
beginning of
period 942,710 729,060 461,369 545,767 374,167
----------- ----------- ----------- ----------- -----------
Cash and cash
equivalents at
end of period $ 1,492,132 $ 942,710 $ 545,767 $ 1,492,132 $ 545,767
=========== =========== =========== =========== ===========
1 Derived from audited financial statements
Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income
(in thousands, except per share data)
(unaudited)
Three Months Ended Three Months Ended
-------------------- --------------------
June 26, March 27,
2011 2011
-------------------- --------------------
U.S. GAAP net income $ 125,928 $ 182,240
Pre-tax non-GAAP items:
Restructuring and impairments -
operating expenses 16,742 -
Non-cash convertible debt
interest expense - other income
(expense), net 3,554 -
Net tax benefit on non-GAAP items (8,224) -
Tax expense associated with legal
entity restructuring 4,289 -
-------------------- --------------------
Non-GAAP net income $ 142,289 $ 182,240
==================== ====================
Non-GAAP net income per diluted
share $ 1.14 $ 1.45
==================== ====================
Number of shares used for diluted
per share calculation 125,086 125,293
Reconciliation of U.S. GAAP Operating Expenses and Operating Income to Non-
GAAP Operating Expenses and Operating Income
(in thousands, except percentages)
(unaudited)
Three Months Ended Three Months Ended
-------------------- --------------------
June 26, March 27,
2011 2011
-------------------- --------------------
U.S. GAAP gross margin $ 338,454 $ 374,019
U.S. GAAP operating expenses $ 196,263 $ 177,023
Pre-tax non-GAAP items:
Restructuring and impairments -
operating expenses (16,742) -
-------------------- --------------------
Non-GAAP operating expenses $ 179,521 $ 177,023
==================== ====================
Non-GAAP operating income $ 158,933 $ 196,996
==================== ====================
Non-GAAP operating margin as a
percent of revenue 21.1% 24.3%
1 Derived from audited financial statements
Lam Research Corporation Contact:Shanye Hudson Director, Investor Relations phone: 510/572-4589 e-mail: Email Contact
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