On July 31, 2024, Lam Research Corp (LRCX, Financial) released its 8-K filing for the quarter ended June 30, 2024. Lam Research, a leading semiconductor wafer fabrication equipment manufacturer, reported robust financial results, surpassing analyst estimates for both earnings per share (EPS) and revenue.
Company Overview
Lam Research is one of the largest semiconductor wafer fabrication equipment manufacturers globally, specializing in deposition and etch market segments. The company holds the top market share in etch and the second share in deposition, with significant exposure to memory chipmakers for DRAM and NAND chips. Its top customers include industry giants such as TSMC, Samsung, Intel, and Micron.
Quarterly Financial Highlights
For the June 2024 quarter, Lam Research reported:
- Revenue of $3.87 billion, surpassing the estimated $3.82 billion.
- U.S. GAAP gross margin of 47.5% and non-GAAP gross margin of 48.5%.
- U.S. GAAP operating income as a percentage of revenue at 29.1% and non-GAAP operating income at 30.7%.
- U.S. GAAP diluted EPS of $7.78, exceeding the estimated $7.42.
- Non-GAAP diluted EPS of $8.14.
Performance Analysis
Lam Research's revenue for the June 2024 quarter was $3.87 billion, a 2.1% increase from the previous quarter's $3.79 billion. The company's gross margin remained steady at 47.5%, while operating income as a percentage of revenue improved to 29.1% from 27.9% in the March 2024 quarter. This performance highlights Lam's ability to maintain profitability despite market fluctuations.
Key Financial Metrics
| Metric | June 2024 | March 2024 | Change Q/Q |
|---|---|---|---|
| Revenue | $3,871,507 | $3,793,558 | +2.1% |
| Gross Margin (GAAP) | 47.5% | 47.5% | +0 bps |
| Operating Income (GAAP) | 29.1% | 27.9% | +120 bps |
| Diluted EPS (GAAP) | $7.78 | $7.34 | +6.0% |
| Gross Margin (Non-GAAP) | 48.5% | 48.7% | -20 bps |
| Operating Income (Non-GAAP) | 30.7% | 30.3% | +40 bps |
| Diluted EPS (Non-GAAP) | $8.14 | $7.79 | +4.5% |
Balance Sheet and Cash Flow
Lam Research's cash and cash equivalents increased to $5.9 billion at the end of the June 2024 quarter, up from $5.7 billion in the previous quarter. The company generated $862.4 million in cash from operating activities, which was partially offset by $373.6 million in share repurchases, $261.5 million in dividends, and $100.7 million in capital expenditures.
Geographic Revenue Distribution
The geographic distribution of revenue for the June 2024 quarter was as follows:
| Region | Revenue |
|---|---|
| China | 39% |
| Korea | 18% |
| Taiwan | 15% |
| United States | 10% |
| Southeast Asia | 8% |
| Japan | 7% |
| Europe | 3% |
Commentary and Outlook
"Lam's June quarter results came in above the midpoint of our guidance, driven by continued solid execution and growth in our customer support business group," said Tim Archer, Lam Research's President and Chief Executive Officer. "We are making strategic investments in R&D and our operations to position Lam to outperform in what we believe will be a multi-year period of strong wafer fab equipment spending."
For the upcoming quarter ending September 29, 2024, Lam Research provided the following guidance:
- Revenue: $4.05 billion +/- $300 million
- Gross margin (GAAP): 46.9% +/- 1%
- Operating income (GAAP): 29.4% +/- 1%
- Net income per diluted share (GAAP): $7.97
Explore the complete 8-K earnings release (here) from Lam Research Corp for further details.
