Highlights for the
- Shipments of
$1,264 million , up 11% from the prior quarter
- Revenue of
$1,227 million , up 10% from the prior quarter
- GAAP gross margin of 43.2%, GAAP operating margin of 15.6% and GAAP diluted EPS of
$0.96
- Non-GAAP gross margin of 45.5%, non-GAAP operating margin of 20.2%, and non-GAAP diluted EPS of
$1.26
Lam Research Corporation | |||||||||||
Financial Highlights for the Quarters Ended |
|||||||||||
(in thousands, except per share data and percentages) | |||||||||||
U.S. GAAP | |||||||||||
March 2014 | December 2013 | Change Q/Q | |||||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | +10 | % | |||||
Gross margin as percentage of revenue | 43.2 | % | 43.7 | % | -50 bps | ||||||
Operating margin as percentage of revenue | 15.6 | % | 14.7 | % | +90 bps | ||||||
Diluted EPS | $ | 0.96 | $ | 0.87 | +10 | % | |||||
Non-GAAP | |||||||||||
March 2014 | December 2013 | Change Q/Q | |||||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | +10 | % | |||||
Gross margin as percentage of revenue | 45.5 | % | 45.8 | % | -30 bps | ||||||
Operating margin as percentage of revenue | 20.2 | % | 18.7 | % | +150 bps | ||||||
Diluted EPS | $ | 1.26 | $ | 1.10 | +15 | % | |||||
GAAP Financial Results
Revenue for the period was
Non-GAAP Financial Results
Non-GAAP gross margin was
"We began 2014 by delivering another solid quarter with record shipments, record revenue, sequential operating margin expansion and very strong free cash flow," stated
Balance Sheet and Cash Flow Results
Cash and cash equivalents, short-term investments, and restricted cash and investment balances increased to
Deferred revenue and deferred profit balances at the end of the
Geographic Distribution
The geographic distribution of shipments and revenue during the
Region | Shipments | Revenue | ||||
11% | 10% | |||||
5% | 6% | |||||
11% | 11% | |||||
28% | 28% | |||||
22% | 19% | |||||
20% | 22% | |||||
3% | 4% | |||||
Outlook
For the
GAAP | Reconciling Items | Non-GAAP | |||||||
Shipments | +/- | - | +/- | ||||||
Revenue | +/- | - | +/- | ||||||
Gross margin | 45% | +/- | 1% | 46% | +/- | 1% | |||
Operating margin | 17% | +/- | 1% | 20% | +/- | 1% | |||
Earning per share | +/- | +/- | |||||||
Diluted share count | 172 Million | 172 Million | |||||||
Reconciling items include:
- Amortization related to intangible assets acquired in the
Novellus transaction,$12 million in gross margin. - Amortization related to intangible assets acquired in the
Novellus transaction,$38 million in operating margin. - Amortization related to intangible assets acquired in the
Novellus transaction,$38 million ; the amortization of convertible note discounts,$8 million ; and the associated tax benefit for non-GAAP items($7) million , in earnings per share.
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
Management uses non-GAAP gross margin, operating income, operating expenses, operating margin, 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 the 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 web site 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 of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relate to, but are not limited to, the anticipated revenue from shipments to Japanese customers, our potential to deliver sustained outperformance, the results of our growth strategy, the opportunity created by our product portfolio combined with the scale of new technology offerings, the effect of multi-patterning, 3D device and advanced packaging industry transitions on our business, our ability to deliver growth and value for our customers and our shareholders, and our guidance for shipments, revenue, gross margin, operating margin, and earnings per share. 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
About
Consolidated Financial Tables Follow.
LAM RESEARCH CORPORATION | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||
(in thousands, except per share data and percentages) | |||||||||||||||||||||
(unaudited) | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
December | |||||||||||||||||||||
2014 | 29, 2013 | 2013 | 2014 | 2013 | |||||||||||||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | $ | 844,928 | $ | 3,358,512 | $ | 2,612,702 | |||||||||||
Cost of goods sold | 696,594 | 628,272 | 505,096 | 1,908,067 | 1,623,570 | ||||||||||||||||
Gross margin | 530,798 | 487,789 | 339,832 | 1,450,445 | 989,132 | ||||||||||||||||
Gross margin as a percent of revenue | 43.2 | % | 43.7 | % | 40.2 | % | 43.2 | % | 37.9 | % | |||||||||||
Research and development | 185,978 | 174,477 | 174,206 | 531,022 | 503,468 | ||||||||||||||||
Selling, general and administrative | 152,883 | 148,838 | 154,807 | 457,604 | 454,091 | ||||||||||||||||
Total operating expenses | 338,861 | 323,315 | 329,013 | 988,626 | 957,559 | ||||||||||||||||
Operating income | 191,937 | 164,474 | 10,819 | 461,819 | 31,573 | ||||||||||||||||
Operating margin as a percent of revenue | 15.6 | % | 14.7 | % | 1.3 | % | 13.8 | % | 1.2 | % | |||||||||||
Other expense, net | (9,855 | ) | (3,837 | ) | (15,834 | ) | (27,954 | ) | (39,162 | ) | |||||||||||
Income (loss) before income taxes | 182,082 | 160,637 | (5,015 | ) | 433,865 | (7,589 | ) | ||||||||||||||
Income tax expense (benefit) | 17,686 | 11,645 | (24,011 | ) | 34,971 | (35,761 | ) | ||||||||||||||
Net income | $ | 164,396 | $ | 148,992 | $ | 18,996 | $ | 398,894 | $ | 28,172 | |||||||||||
Net income per share: | |||||||||||||||||||||
Basic net income per share | $ | 1.01 | $ | 0.92 | $ | 0.12 | $ | 2.46 | $ | 0.16 | |||||||||||
Diluted net income per share | $ | 0.96 | $ | 0.87 | $ | 0.11 | $ | 2.33 | $ | 0.16 | |||||||||||
Number of shares used in per share calculations: | |||||||||||||||||||||
Basic | 162,238 | 162,305 | 163,034 | 161,904 | 171,016 | ||||||||||||||||
Diluted | 171,636 | 171,757 | 168,504 | 171,051 | 174,306 | ||||||||||||||||
LAM RESEARCH CORPORATION | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(in thousands) | ||||||||||
2014 | 2013 | 2013 | ||||||||
(unaudited) | (unaudited) | (1) | ||||||||
ASSETS | ||||||||||
Cash and cash equivalents | $ | 1,292,301 | $ | 1,132,555 | $ | 1,162,473 | ||||
Short-term investments | 1,462,171 | 1,389,735 | 1,334,745 | |||||||
Accounts receivable, net | 818,390 | 909,720 | 602,624 | |||||||
Inventories | 717,356 | 661,572 | 559,317 | |||||||
Other current assets | 157,131 | 155,454 | 134,670 | |||||||
Total current assets | 4,447,349 | 4,249,036 | 3,793,829 | |||||||
Property and equipment, net | 552,591 | 546,193 | 603,910 | |||||||
Restricted cash and investments | 143,914 | 166,395 | 166,536 | |||||||
Goodwill and intangible assets | 2,408,913 | 2,453,066 | 2,526,541 | |||||||
Other assets | 154,600 | 141,108 | 159,499 | |||||||
Total assets | $ | 7,707,367 | $ | 7,555,798 | $ | 7,250,315 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
Current liabilities | $ | 1,542,705 | $ | 1,522,572 | $ | 1,404,475 | ||||
Long-term debt, convertible notes, and capital leases | $ | 810,688 | $ | 803,276 | $ | 789,256 | ||||
Income taxes payable | 251,080 | 248,996 | 246,479 | |||||||
Other long-term liabilities | 111,346 | 129,710 | 134,313 | |||||||
Total liabilities | 2,715,819 | 2,704,554 | 2,574,523 | |||||||
Senior convertible notes | 184,256 | 185,154 | 186,920 | |||||||
Stockholders' equity (2) | 4,807,292 | 4,666,090 | 4,488,872 | |||||||
Total liabilities and stockholders' equity | $ | 7,707,367 | $ | 7,555,798 | $ | 7,250,315 |
(1) | Derived from audited financial statements |
(2) | Common shares issued and outstanding were 161,988 shares as of |
LAM RESEARCH CORPORATION | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
(unaudited) | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
December | |||||||||||||||||||||
2014 | 29, 2013 | 2013 | 2014 | 2013 | |||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||||||||
Net income | $ | 164,396 | $ | 148,992 | $ | 18,996 | $ | 398,894 | $ | 28,172 | |||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||||
Depreciation and amortization | 73,256 | 73,552 | 74,861 | 221,139 | 228,065 | ||||||||||||||||
Deferred income taxes | (816 | ) | 12,457 | (27,934 | ) | 11,641 | (47,271 | ) | |||||||||||||
Impairment of long-lived asset | 4,000 | 628 | - | 11,632 | - | ||||||||||||||||
Equity-based compensation expense | 24,334 | 23,046 | 25,648 | 70,615 | 74,089 | ||||||||||||||||
Amortization of convertible note discount | 8,313 | 8,217 | 7,935 | 24,652 | 23,530 | ||||||||||||||||
Impairment of investment, net of foreign exchange effect | - | - | 3,711 | - | 3,711 | ||||||||||||||||
Other, net | 2,741 | (2,428 | ) | 6,171 | 4,428 | 31,915 | |||||||||||||||
Changes in operating assets and liabilities: | 13,986 | (135,441 | ) | (6,931 | ) | (271,843 | ) | 202,734 | |||||||||||||
Net cash provided by operating activities | 290,210 | 129,023 | 102,457 | 471,158 | 544,945 | ||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||||||||
Capital expenditures and intangible assets | (41,638 | ) | (38,323 | ) | (34,766 | ) | (103,739 | ) | (117,655 | ) | |||||||||||
Cash paid for business acquisition | - | (18,388 | ) | (400 | ) | (18,388 | ) | (9,116 | ) | ||||||||||||
Net purchases of available-for-sale securities | (82,744 | ) | (88,754 | ) | (12,075 | ) | (128,931 | ) | (51,963 | ) | |||||||||||
Repayments of notes receivable | - | 10,000 | - | 10,000 | - | ||||||||||||||||
Proceeds from sale of assets | - | 21,635 | - | 21,635 | 660 | ||||||||||||||||
Transfer of restricted cash and investments | 28,572 | - | (32 | ) | 28,722 | 147 | |||||||||||||||
Net cash used for investing activities | (95,810 | ) | (113,830 | ) | (47,273 | ) | (190,701 | ) | (177,927 | ) | |||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||||||||
Principal payments on long-term debt and capital lease obligations | (112 | ) | (719 | ) | (756 | ) | (919 | ) | (1,536 | ) | |||||||||||
Excess tax benefit on equity-based compensation plans | (296 | ) | - | (903 | ) | (296 | ) | (903 | ) | ||||||||||||
Treasury stock purchases | (52,415 | ) | (47,910 | ) | (243,297 | ) | (204,610 | ) | (953,386 | ) | |||||||||||
Reissuances of treasury stock related to employee stock purchase plan | 13,210 | (35 | ) | 8,494 | 28,329 | 18,419 | |||||||||||||||
Proceeds from issuance of common stock | 5,111 | 8,449 | 15,132 | 26,134 | 22,666 | ||||||||||||||||
Net cash used for financing activities | (34,502 | ) | (40,215 | ) | (221,330 | ) | (151,362 | ) | (914,740 | ) | |||||||||||
Effect of exchange rate changes on cash | (152 | ) | 1,393 | (4,934 | ) | 733 | 2,079 | ||||||||||||||
Net increase (decrease) in cash and cash equivalents | 159,746 | (23,629 | ) | (171,080 | ) | 129,828 | (545,643 | ) | |||||||||||||
Cash and cash equivalents at beginning of period | 1,132,555 | 1,156,184 | 1,190,189 | 1,162,473 | 1,564,752 | ||||||||||||||||
Cash and cash equivalents at end of period | $ | 1,292,301 | $ | 1,132,555 | $ | 1,019,109 | $ | 1,292,301 | $ | 1,019,109 | |||||||||||
Non-GAAP Financial Summary | ||||||||
(in thousands, except percentages and per share data) | ||||||||
(unaudited) | ||||||||
Three Months Ended | Three Months Ended | |||||||
2014 | 2013 | |||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | ||||
Gross margin | $ | 558,881 | $ | 510,769 | ||||
Gross margin as percentage of revenue | 45.5 | % | 45.8 | % | ||||
Operating expenses | $ | 311,046 | $ | 302,103 | ||||
Operating income | $ | 247,835 | $ | 208,666 | ||||
Operating margin as a percentage of revenue | 20.2 | % | 18.7 | % | ||||
Net income | $ | 216,384 | $ | 188,745 | ||||
Net income per diluted share | $ | 1.26 | $ | 1.10 | ||||
Shares used in per share calculation - diluted | 171,636 | 171,757 | ||||||
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 | ||||||||
2014 | 2013 | ||||||||
U.S. GAAP net income | $ | 164,396 | $ | 148,992 | |||||
Pre-tax non-GAAP items: | |||||||||
Amortization related to intangible assets acquired in |
21,670 | 21,491 | |||||||
Costs associated with rationalization of certain product configurations - cost of goods sold | 4,855 | - | |||||||
Acquisition-related inventory fair value impact - cost of goods sold | - | 1,225 | |||||||
Integration costs - cost of goods sold | - | 264 | |||||||
Synthetic lease impairment - cost of good sold | 1,558 | - | |||||||
Integration costs - operating expenses | - | 2,785 | |||||||
Amortization related to intangible assets acquired in |
16,537 | 16,953 | |||||||
Costs associated with rationalization of certain product configurations - operating expenses | 1,922 | 846 | |||||||
Impairment of long lived asset - operating expenses | 4,000 | 628 | |||||||
Synthetic lease impairment - operating expenses | 5,356 | - | |||||||
Amortization of convertible note discount, Lam notes - other expense, net | 7,416 | 7,329 | |||||||
Amortization of convertible note discount, |
999 | 762 | |||||||
Gain on sale of investment - other expense, net | - | (4,813 | ) | ||||||
Net tax benefit on non-GAAP items | (12,325 | ) | (6,404 | ) | |||||
Net tax benefit on successful resolution of certain tax matters | - | (1,313 | ) | ||||||
Non-GAAP net income | $ | 216,384 | $ | 188,745 | |||||
Non-GAAP net income per diluted share | $ | 1.26 | $ | 1.10 | |||||
Number of shares used for diluted per share calculation | 171,636 | 171,757 | |||||||
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 | Three Months Ended | ||||||||
2014 | 2013 | ||||||||
U.S. GAAP gross margin | $ | 530,798 | $ | 487,789 | |||||
Pre-tax non-GAAP items: | |||||||||
Amortization related to intangible assets acquired in |
21,670 | 21,491 | |||||||
Costs associated with rationalization of certain product configurations - cost of goods sold | 4,855 | - | |||||||
Acquisition-related inventory fair value impact - cost of goods sold | - | 1,225 | |||||||
Integration costs - cost of goods sold | - | 264 | |||||||
Synthetic lease impairment - cost of good sold | 1,558 | - | |||||||
Non-GAAP gross margin | $ | 558,881 | $ | 510,769 | |||||
U.S. GAAP gross margin as a percentage of revenue | 43.2 | % | 43.7 | % | |||||
Non-GAAP gross margin as a percentage of revenue | 45.5 | % | 45.8 | % | |||||
U.S. GAAP operating expenses | $ | 338,861 | $ | 323,315 | |||||
Pre-tax non-GAAP items: | |||||||||
Integration costs - operating expenses | - | (2,785 | ) | ||||||
Amortization related to intangible assets acquired in |
(16,537 | ) | (16,953 | ) | |||||
Costs associated with rationalization of certain product configurations - operating expenses | (1,922 | ) | (846 | ) | |||||
Impairment of long lived asset - operating expenses | (4,000 | ) | (628 | ) | |||||
Synthetic lease impairment - operating expenses | (5,356 | ) | - | ||||||
Non-GAAP operating expenses | $ | 311,046 | $ | 302,103 | |||||
Non-GAAP operating income | $ | 247,835 | $ | 208,666 | |||||
Non-GAAP operating margin as a percent of revenue | 20.2 | % | 18.7 | % |
Lam Research Corporation Contacts:
Investor Relations
phone: 510-572-4589
e-mail: shanye.hudson@lamresearch.com
Source:
News Provided by Acquire Media
Highlights for the
- Shipments of
$1,264 million , up 11% from the prior quarter
- Revenue of
$1,227 million , up 10% from the prior quarter
- GAAP gross margin of 43.2%, GAAP operating margin of 15.6% and GAAP diluted EPS of
$0.96
- Non-GAAP gross margin of 45.5%, non-GAAP operating margin of 20.2%, and non-GAAP diluted EPS of
$1.26
Lam Research Corporation | |||||||||||
Financial Highlights for the Quarters Ended |
|||||||||||
(in thousands, except per share data and percentages) | |||||||||||
U.S. GAAP | |||||||||||
March 2014 | December 2013 | Change Q/Q | |||||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | +10 | % | |||||
Gross margin as percentage of revenue | 43.2 | % | 43.7 | % | -50 bps | ||||||
Operating margin as percentage of revenue | 15.6 | % | 14.7 | % | +90 bps | ||||||
Diluted EPS | $ | 0.96 | $ | 0.87 | +10 | % | |||||
Non-GAAP | |||||||||||
March 2014 | December 2013 | Change Q/Q | |||||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | +10 | % | |||||
Gross margin as percentage of revenue | 45.5 | % | 45.8 | % | -30 bps | ||||||
Operating margin as percentage of revenue | 20.2 | % | 18.7 | % | +150 bps | ||||||
Diluted EPS | $ | 1.26 | $ | 1.10 | +15 | % | |||||
GAAP Financial Results
Revenue for the period was
Non-GAAP Financial Results
Non-GAAP gross margin was
"We began 2014 by delivering another solid quarter with record shipments, record revenue, sequential operating margin expansion and very strong free cash flow," stated
Balance Sheet and Cash Flow Results
Cash and cash equivalents, short-term investments, and restricted cash and investment balances increased to
Deferred revenue and deferred profit balances at the end of the
Geographic Distribution
The geographic distribution of shipments and revenue during the
Region | Shipments | Revenue | ||||
11% | 10% | |||||
5% | 6% | |||||
11% | 11% | |||||
28% | 28% | |||||
22% | 19% | |||||
20% | 22% | |||||
3% | 4% | |||||
Outlook
For the
GAAP | Reconciling Items | Non-GAAP | |||||||
Shipments | +/- | - | +/- | ||||||
Revenue | +/- | - | +/- | ||||||
Gross margin | 45% | +/- | 1% | 46% | +/- | 1% | |||
Operating margin | 17% | +/- | 1% | 20% | +/- | 1% | |||
Earning per share | +/- | +/- | |||||||
Diluted share count | 172 Million | 172 Million | |||||||
Reconciling items include:
- Amortization related to intangible assets acquired in the
Novellus transaction,$12 million in gross margin. - Amortization related to intangible assets acquired in the
Novellus transaction,$38 million in operating margin. - Amortization related to intangible assets acquired in the
Novellus transaction,$38 million ; the amortization of convertible note discounts,$8 million ; and the associated tax benefit for non-GAAP items($7) million , in earnings per share.
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
Management uses non-GAAP gross margin, operating income, operating expenses, operating margin, 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 the 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 web site 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 of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements relate to, but are not limited to, the anticipated revenue from shipments to Japanese customers, our potential to deliver sustained outperformance, the results of our growth strategy, the opportunity created by our product portfolio combined with the scale of new technology offerings, the effect of multi-patterning, 3D device and advanced packaging industry transitions on our business, our ability to deliver growth and value for our customers and our shareholders, and our guidance for shipments, revenue, gross margin, operating margin, and earnings per share. 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
About
Consolidated Financial Tables Follow.
LAM RESEARCH CORPORATION | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||
(in thousands, except per share data and percentages) | |||||||||||||||||||||
(unaudited) | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
December | |||||||||||||||||||||
2014 | 29, 2013 | 2013 | 2014 | 2013 | |||||||||||||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | $ | 844,928 | $ | 3,358,512 | $ | 2,612,702 | |||||||||||
Cost of goods sold | 696,594 | 628,272 | 505,096 | 1,908,067 | 1,623,570 | ||||||||||||||||
Gross margin | 530,798 | 487,789 | 339,832 | 1,450,445 | 989,132 | ||||||||||||||||
Gross margin as a percent of revenue | 43.2 | % | 43.7 | % | 40.2 | % | 43.2 | % | 37.9 | % | |||||||||||
Research and development | 185,978 | 174,477 | 174,206 | 531,022 | 503,468 | ||||||||||||||||
Selling, general and administrative | 152,883 | 148,838 | 154,807 | 457,604 | 454,091 | ||||||||||||||||
Total operating expenses | 338,861 | 323,315 | 329,013 | 988,626 | 957,559 | ||||||||||||||||
Operating income | 191,937 | 164,474 | 10,819 | 461,819 | 31,573 | ||||||||||||||||
Operating margin as a percent of revenue | 15.6 | % | 14.7 | % | 1.3 | % | 13.8 | % | 1.2 | % | |||||||||||
Other expense, net | (9,855 | ) | (3,837 | ) | (15,834 | ) | (27,954 | ) | (39,162 | ) | |||||||||||
Income (loss) before income taxes | 182,082 | 160,637 | (5,015 | ) | 433,865 | (7,589 | ) | ||||||||||||||
Income tax expense (benefit) | 17,686 | 11,645 | (24,011 | ) | 34,971 | (35,761 | ) | ||||||||||||||
Net income | $ | 164,396 | $ | 148,992 | $ | 18,996 | $ | 398,894 | $ | 28,172 | |||||||||||
Net income per share: | |||||||||||||||||||||
Basic net income per share | $ | 1.01 | $ | 0.92 | $ | 0.12 | $ | 2.46 | $ | 0.16 | |||||||||||
Diluted net income per share | $ | 0.96 | $ | 0.87 | $ | 0.11 | $ | 2.33 | $ | 0.16 | |||||||||||
Number of shares used in per share calculations: | |||||||||||||||||||||
Basic | 162,238 | 162,305 | 163,034 | 161,904 | 171,016 | ||||||||||||||||
Diluted | 171,636 | 171,757 | 168,504 | 171,051 | 174,306 | ||||||||||||||||
LAM RESEARCH CORPORATION | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(in thousands) | ||||||||||
2014 | 2013 | 2013 | ||||||||
(unaudited) | (unaudited) | (1) | ||||||||
ASSETS | ||||||||||
Cash and cash equivalents | $ | 1,292,301 | $ | 1,132,555 | $ | 1,162,473 | ||||
Short-term investments | 1,462,171 | 1,389,735 | 1,334,745 | |||||||
Accounts receivable, net | 818,390 | 909,720 | 602,624 | |||||||
Inventories | 717,356 | 661,572 | 559,317 | |||||||
Other current assets | 157,131 | 155,454 | 134,670 | |||||||
Total current assets | 4,447,349 | 4,249,036 | 3,793,829 | |||||||
Property and equipment, net | 552,591 | 546,193 | 603,910 | |||||||
Restricted cash and investments | 143,914 | 166,395 | 166,536 | |||||||
Goodwill and intangible assets | 2,408,913 | 2,453,066 | 2,526,541 | |||||||
Other assets | 154,600 | 141,108 | 159,499 | |||||||
Total assets | $ | 7,707,367 | $ | 7,555,798 | $ | 7,250,315 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||
Current liabilities | $ | 1,542,705 | $ | 1,522,572 | $ | 1,404,475 | ||||
Long-term debt, convertible notes, and capital leases | $ | 810,688 | $ | 803,276 | $ | 789,256 | ||||
Income taxes payable | 251,080 | 248,996 | 246,479 | |||||||
Other long-term liabilities | 111,346 | 129,710 | 134,313 | |||||||
Total liabilities | 2,715,819 | 2,704,554 | 2,574,523 | |||||||
Senior convertible notes | 184,256 | 185,154 | 186,920 | |||||||
Stockholders' equity (2) | 4,807,292 | 4,666,090 | 4,488,872 | |||||||
Total liabilities and stockholders' equity | $ | 7,707,367 | $ | 7,555,798 | $ | 7,250,315 |
(1) | Derived from audited financial statements |
(2) | Common shares issued and outstanding were 161,988 shares as of |
LAM RESEARCH CORPORATION | |||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||
(in thousands) | |||||||||||||||||||||
(unaudited) | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
December | |||||||||||||||||||||
2014 | 29, 2013 | 2013 | 2014 | 2013 | |||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||||||||
Net income | $ | 164,396 | $ | 148,992 | $ | 18,996 | $ | 398,894 | $ | 28,172 | |||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||||
Depreciation and amortization | 73,256 | 73,552 | 74,861 | 221,139 | 228,065 | ||||||||||||||||
Deferred income taxes | (816 | ) | 12,457 | (27,934 | ) | 11,641 | (47,271 | ) | |||||||||||||
Impairment of long-lived asset | 4,000 | 628 | - | 11,632 | - | ||||||||||||||||
Equity-based compensation expense | 24,334 | 23,046 | 25,648 | 70,615 | 74,089 | ||||||||||||||||
Amortization of convertible note discount | 8,313 | 8,217 | 7,935 | 24,652 | 23,530 | ||||||||||||||||
Impairment of investment, net of foreign exchange effect | - | - | 3,711 | - | 3,711 | ||||||||||||||||
Other, net | 2,741 | (2,428 | ) | 6,171 | 4,428 | 31,915 | |||||||||||||||
Changes in operating assets and liabilities: | 13,986 | (135,441 | ) | (6,931 | ) | (271,843 | ) | 202,734 | |||||||||||||
Net cash provided by operating activities | 290,210 | 129,023 | 102,457 | 471,158 | 544,945 | ||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||||||||
Capital expenditures and intangible assets | (41,638 | ) | (38,323 | ) | (34,766 | ) | (103,739 | ) | (117,655 | ) | |||||||||||
Cash paid for business acquisition | - | (18,388 | ) | (400 | ) | (18,388 | ) | (9,116 | ) | ||||||||||||
Net purchases of available-for-sale securities | (82,744 | ) | (88,754 | ) | (12,075 | ) | (128,931 | ) | (51,963 | ) | |||||||||||
Repayments of notes receivable | - | 10,000 | - | 10,000 | - | ||||||||||||||||
Proceeds from sale of assets | - | 21,635 | - | 21,635 | 660 | ||||||||||||||||
Transfer of restricted cash and investments | 28,572 | - | (32 | ) | 28,722 | 147 | |||||||||||||||
Net cash used for investing activities | (95,810 | ) | (113,830 | ) | (47,273 | ) | (190,701 | ) | (177,927 | ) | |||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||||||||
Principal payments on long-term debt and capital lease obligations | (112 | ) | (719 | ) | (756 | ) | (919 | ) | (1,536 | ) | |||||||||||
Excess tax benefit on equity-based compensation plans | (296 | ) | - | (903 | ) | (296 | ) | (903 | ) | ||||||||||||
Treasury stock purchases | (52,415 | ) | (47,910 | ) | (243,297 | ) | (204,610 | ) | (953,386 | ) | |||||||||||
Reissuances of treasury stock related to employee stock purchase plan | 13,210 | (35 | ) | 8,494 | 28,329 | 18,419 | |||||||||||||||
Proceeds from issuance of common stock | 5,111 | 8,449 | 15,132 | 26,134 | 22,666 | ||||||||||||||||
Net cash used for financing activities | (34,502 | ) | (40,215 | ) | (221,330 | ) | (151,362 | ) | (914,740 | ) | |||||||||||
Effect of exchange rate changes on cash | (152 | ) | 1,393 | (4,934 | ) | 733 | 2,079 | ||||||||||||||
Net increase (decrease) in cash and cash equivalents | 159,746 | (23,629 | ) | (171,080 | ) | 129,828 | (545,643 | ) | |||||||||||||
Cash and cash equivalents at beginning of period | 1,132,555 | 1,156,184 | 1,190,189 | 1,162,473 | 1,564,752 | ||||||||||||||||
Cash and cash equivalents at end of period | $ | 1,292,301 | $ | 1,132,555 | $ | 1,019,109 | $ | 1,292,301 | $ | 1,019,109 | |||||||||||
Non-GAAP Financial Summary | ||||||||
(in thousands, except percentages and per share data) | ||||||||
(unaudited) | ||||||||
Three Months Ended | Three Months Ended | |||||||
2014 | 2013 | |||||||
Revenue | $ | 1,227,392 | $ | 1,116,061 | ||||
Gross margin | $ | 558,881 | $ | 510,769 | ||||
Gross margin as percentage of revenue | 45.5 | % | 45.8 | % | ||||
Operating expenses | $ | 311,046 | $ | 302,103 | ||||
Operating income | $ | 247,835 | $ | 208,666 | ||||
Operating margin as a percentage of revenue | 20.2 | % | 18.7 | % | ||||
Net income | $ | 216,384 | $ | 188,745 | ||||
Net income per diluted share | $ | 1.26 | $ | 1.10 | ||||
Shares used in per share calculation - diluted | 171,636 | 171,757 | ||||||
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 | ||||||||
2014 | 2013 | ||||||||
U.S. GAAP net income | $ | 164,396 | $ | 148,992 | |||||
Pre-tax non-GAAP items: | |||||||||
Amortization related to intangible assets acquired in |
21,670 | 21,491 | |||||||
Costs associated with rationalization of certain product configurations - cost of goods sold | 4,855 | - | |||||||
Acquisition-related inventory fair value impact - cost of goods sold | - | 1,225 | |||||||
Integration costs - cost of goods sold | - | 264 | |||||||
Synthetic lease impairment - cost of good sold | 1,558 | - | |||||||
Integration costs - operating expenses | - | 2,785 | |||||||
Amortization related to intangible assets acquired in |
16,537 | 16,953 | |||||||
Costs associated with rationalization of certain product configurations - operating expenses | 1,922 | 846 | |||||||
Impairment of long lived asset - operating expenses | 4,000 | 628 | |||||||
Synthetic lease impairment - operating expenses | 5,356 | - | |||||||
Amortization of convertible note discount, Lam notes - other expense, net | 7,416 | 7,329 | |||||||
Amortization of convertible note discount, |
999 | 762 | |||||||
Gain on sale of investment - other expense, net | - | (4,813 | ) | ||||||
Net tax benefit on non-GAAP items | (12,325 | ) | (6,404 | ) | |||||
Net tax benefit on successful resolution of certain tax matters | - | (1,313 | ) | ||||||
Non-GAAP net income | $ | 216,384 | $ | 188,745 | |||||
Non-GAAP net income per diluted share | $ | 1.26 | $ | 1.10 | |||||
Number of shares used for diluted per share calculation | 171,636 | 171,757 | |||||||
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 | Three Months Ended | ||||||||
2014 | 2013 | ||||||||
U.S. GAAP gross margin | $ | 530,798 | $ | 487,789 | |||||
Pre-tax non-GAAP items: | |||||||||
Amortization related to intangible assets acquired in |
21,670 | 21,491 | |||||||
Costs associated with rationalization of certain product configurations - cost of goods sold | 4,855 | - | |||||||
Acquisition-related inventory fair value impact - cost of goods sold | - | 1,225 | |||||||
Integration costs - cost of goods sold | - | 264 | |||||||
Synthetic lease impairment - cost of good sold | 1,558 | - | |||||||
Non-GAAP gross margin | $ | 558,881 | $ | 510,769 | |||||
U.S. GAAP gross margin as a percentage of revenue | 43.2 | % | 43.7 | % | |||||
Non-GAAP gross margin as a percentage of revenue | 45.5 | % | 45.8 | % | |||||
U.S. GAAP operating expenses | $ | 338,861 | $ | 323,315 | |||||
Pre-tax non-GAAP items: | |||||||||
Integration costs - operating expenses | - | (2,785 | ) | ||||||
Amortization related to intangible assets acquired in |
(16,537 | ) | (16,953 | ) | |||||
Costs associated with rationalization of certain product configurations - operating expenses | (1,922 | ) | (846 | ) | |||||
Impairment of long lived asset - operating expenses | (4,000 | ) | (628 | ) | |||||
Synthetic lease impairment - operating expenses | (5,356 | ) | - | ||||||
Non-GAAP operating expenses | $ | 311,046 | $ | 302,103 | |||||
Non-GAAP operating income | $ | 247,835 | $ | 208,666 | |||||
Non-GAAP operating margin as a percent of revenue | 20.2 | % | 18.7 | % |
Lam Research Corporation Contacts:
Investor Relations
phone: 510-572-4589
e-mail: shanye.hudson@lamresearch.com
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