Press Releases

FREMONT, Calif., April 24, 2019 (GLOBE NEWSWIRE) -- Lam Research Corporation (the "Company," "Lam," "Lam Research") today announced financial results for the quarter ended March 31, 2019 (the “March 2019 quarter”).

Highlights for the March 2019 quarter were as follows:

• Revenue of $2.44 billion.
• U.S. GAAP gross margin of 44.0%, U.S. GAAP operating income as a percentage of revenue of 23.2%, and U.S. GAAP diluted EPS of $3.47.
• Non-GAAP gross margin of 45.1%, non-GAAP operating income as a percentage of revenue of 25.1%, and non-GAAP diluted EPS of $3.70.

Key Financial Data for the Quarters Ended
March 31, 2019 and December 23, 2018
(in thousands, except per-share data, percentages, and basis points)

U.S. GAAP Financial Results

For the March 2019 quarter, revenue was $2,439 million, gross margin was $1,074 million, or 44.0% of revenue, operating expenses were $509 million, operating income was 23.2% of revenue, and net income was $547 million, or $3.47 per diluted share on a U.S. GAAP basis. This compares to revenue of $2,523 million, gross margin of $1,145 million, or 45.4% of revenue, operating expenses of $455 million, operating income of 27.4% of revenue, and net income of $569 million, or $3.51 per diluted share, for the quarter ended December 23, 2018 (the “December 2018 quarter”). The March 2019 quarter included 14 weeks; the December 2018 quarter included 13 weeks.

Non-GAAP Financial Results

For the March 2019 quarter, non-GAAP gross margin was $1,100 million or 45.1% of revenue, non-GAAP operating expenses were $488 million, non-GAAP operating income was 25.1% of revenue, and non-GAAP net income was $584 million, or $3.70 per diluted share. This compares to non-GAAP gross margin of $1,167 million or 46.3% of revenue, non-GAAP operating expenses of $440 million, non-GAAP operating income of 28.8% of revenue, and non-GAAP net income of $628 million, or $3.87 per diluted share for the December 2018 quarter.

“Lam’s March quarter results demonstrate strong execution in a challenging near-term industry environment,” said Timothy Archer, Lam Research’s President and Chief Executive Officer. “By continuing to focus on customer needs and investing to extend differentiation in our product and services portfolio, Lam is well positioned to emerge stronger as market conditions improve.”

Balance Sheet and Cash Flow Results

Cash and cash equivalents, short-term investments, and restricted cash and investments balances increased to $6.4 billion at the end of the March 2019 quarter as compared to $3.9 billion at the end of the December 2018 quarter. This increase was primarily the result of approximately $2.5 billion of proceeds from issuance of senior notes during the March 2019 quarter.

Deferred revenue and deferred profit at the end of the March 2019 quarter decreased to $441 million and $378 million, respectively, as compared to $493 million and $432 million, respectively, at the end of the December 2018 quarter. Lam’s deferred revenue balance does not include shipments to customers in Japan, to whom title does not transfer until customer acceptance. Shipments to customers in Japan are classified as inventory at cost until the time of acceptance. The estimated future revenue from shipments to customers in Japan was approximately $80 million as of March 31, 2019 and $262 million as of December 23, 2018.

Geographic Distribution

The geographic distribution of revenue during the March 2019 quarter is shown in the following table:

Outlook

For the June 2019 quarter, Lam is providing the following guidance:

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, other investments, or other significant transactions that may be completed 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, $3 million.
• Operating income as a percentage of revenue - amortization related to intangible assets acquired through business combinations, $16 million.
• Earnings per share - amortization related to intangible assets acquired though business combinations, $16 million; amortization of note discounts, $1 million; and associated tax benefit for non-GAAP items ($3 million); totaling $14 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 March 2019 and December 2018 quarters exclude amortization related to intangible assets acquired through business combinations, restructuring charges, amortization of note discounts, income tax benefit of non-GAAP items, and income tax benefit on the conclusion of tax matters related to a prior business combination. Additionally, the December 2018 quarter non-GAAP results exclude estimated income tax impacts associated with U.S. tax reform.

Management uses non-GAAP gross margin, operating expense, operating income, 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 focus on customer needs; our investments to extend differentiation in our products and services; the estimated future revenue from shipments to customers in Japan; the timing and amount of revenue and profit earned from any booked deferred revenue and profit; market trends and semiconductor demand; our technology leadership; our installed base growth; our positioning as market conditions change; technology demand trends; the legal and business factors that may affect our future tax rate; our engineering capabilities; our commitment to customer success; our continued ability to accelerate innovation and enhance device performance; and our guidance for revenue, gross margin (both as a dollar value and a percentage of revenue), operating income (both as a dollar value and a percentage of revenue), net income or earnings per diluted share, and diluted share count. Some factors that may affect these forward-looking statements include: business, political and/or regulatory conditions in the consumer electronics industry, the semiconductor industry and the overall economy may deteriorate or change; and the actions of our customers and competitors may be inconsistent with our expectations, 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 24, 2018 and our quarterly report on Form 10-Q for the fiscal quarters ended September 23, 2018 and December 23, 2018. These uncertainties and changes could materially affect the forward looking statements and cause actual results to vary from expectations in a material way. The Company undertakes no obligation to update the information or statements made in this release.

About Lam Research

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. 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)
(unaudited)

LAM RESEARCH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

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

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

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

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)

Lam Research Corporation Contacts:

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

Source: Lam Research Corporation