Slide 1: December Quarter 2017 Financial Results
Lam Research Corporation December Quarter 2017 Financial Results January 24, 2018 © 2018 Lam Research Corp. | 1.24.2018 1
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements This presentation and the accompanying discussion contain “forward-looking statements” under U.S. securities laws. Forward-looking statements include any statements that are not statements of historical fact. Examples of forward-looking state
Slide 3: Business Review and Industry Outlook
Business Review and Industry Outlook Martin Anstice Chief Executive Officer © 2018 Lam Research Corp. | 1.24.2018 3
Slide 4: December Quarter Results and March Guidance
December Quarter Results and March Guidance ► QDec’17 shipments, revenues, and non-GAAP earnings per share* at new record levels ► QMar’18 shipment and revenue guidance to exceed QDec’17 results Strong momentum continues *Data are presented on a non-GAAP basis. Reconciliations of U.S. GAAP results t
Slide 5: 2017: A Sixth Consecutive Year of Outperformance
2017: A Sixth Consecutive Year of Outperformance ► CY’17 shipments up 50%, well above WFE growth of ~30% ► >$13 in non-GAAP earnings per share ► >2 point of shipped share gains Strong gains in ALD, dielectric etch, conductor etch, and key deposition applications Record logic shipments validate b
Slide 6: 2018: WFE Growth Led by DRAM and Logic
2018: WFE Growth Led by DRAM and Logic ► Expect double-digit growth in memory WFE, with greater balance between DRAM and NAND ► Expect modest, demand-led expansion of DRAM installed base to support datacenter demand ► Expect sustained to slightly higher WFE in NAND, with Lam’s addressable market gro
Slide 7: December Quarter 2017 Financial Results and March Quarter 2018 Outlook
December Quarter 2017 Financial Results and March Quarter 2018 Outlook Doug Bettinger Executive Vice President & Chief Financial Officer © 2018 Lam Research Corp. | 1.24.2018 7
Slide 8: December Quarter and CY'17 Results
December Quarter and CY’17 Results ► QDec’17 above mid-point of guidance for all metrics* ► Record levels for cash from operations, dividends, and share repurchases in CY’17 Cash from Operations Dividends Share Repurchases $293 $1,900 $2.0 $ Millions $ Millions $ Billions $1.5 $192 $65 CY'16 CY'17 C
Slide 9: December Quarter Shipments
December Quarter Shipments ► QDec’17 shipments of $2.632 billion, an 11% increase quarter over quarter ► System shipments segment mix: Dec’17 Sep’17 Logic/Other Logic/Other 8% 13% Foundry 15% NVM Memory Foundry 21% NVM Memory 53% 77% 49% 66% DRAM 24% DRAM 17% © 2018 Lam Research Corp. | 1.24.2018 9
Slide 10: December Quarter Financial Results
December Quarter Financial Results Dec’17 Sep’17 Revenue $2,581M $2,478M Non-GAAP Gross Margin* 47.6% 47.2% Non-GAAP Operating Expenses* $449M $438M Non-GAAP Operating Income* $779M $733M Non-GAAP Operating Margin* 30.2% 29.6% Non-GAAP Other Income/(Expense)* $0.3M ($1.4M) Non-GAAP Tax Rate* -1% 14%
Slide 11: Key Balance Sheet and Financial Metrics
Key Balance Sheet and Financial Metrics Dec’17 Sep’17 Total Consolidated Gross Cash Balance $5,956M $6,438M Account Receivables, Net $2,279M $1,531M DSO 80 Days 56 Days Inventory Turns 3.6 4.0 Deferred Revenue* $1,114M $938M Capital Expenditures $85M $60M Equity Compensation Expense $42M $42M Amorti
Slide 12: March 2018 Quarter Non-GAAP Guidance
March 2018 Quarter Non-GAAP Guidance Mar’18 Guidance Shipments $3.175 billion ± $125 million Revenue $2.850 billion ± $125 million Non-GAAP Gross Margin 46.0% ± 1% Non-GAAP Operating Margin 29.0% ± 1% Non-GAAP Earnings per Share* $4.35 ± $0.15 *Based on a share count of ~181 million shares. © 2018 L
Slide 13: Questions & Answers
Questions & Answers © 2018 Lam Research Corp. | 1.24.2018 13
Slide 14: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP Net (Loss) Income to Non-GAAP Net Income and U.S. GAAP number of dilutive shares to Non-GAAP number of dilutive shares (in thousands, except per share data) (unaudited) Twelve Months Three Months Ended Ended December 24, September 24, June 25, Ma
Slide 15: Appendix – Reconciliation
Appendix – Reconciliation 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 December 24, September 24, 2017 2017 U.S. GAAP gross margin
Slide 16: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP Other Income (Expense), Net to Non-GAAP Other Income (Expense), Net (in thousands) (unaudited) Three Months Ended December 24, September 24, 2017 2017 U.S. GAAP Other expense, net $ (3,152) $ (5,502) Pre-tax non-GAAP items: Amortization of note d
Slide 17: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP Income Tax Rate to Non-GAAP Income Tax Rate (in thousands, except percentages) (unaudited) Three Months Ended December 24, September 24, 2017 2017 U.S. GAAP income before income taxes 734,219 $ 687,720 U.S. GAAP income tax expense 744,174 $ 97,03
Slide 18: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP to Non-GAAP Guidance for the March 2018 quarter (unaudited) Reconciling U.S. GAAP Items Non-GAAP Shipments $3.175 Billion +/- $125 Million — $3.175 Billion +/- $125 Million Revenue $2.850 Billion +/- $125 Million — $2.850 Billion +/- $125 Million
Slide 19: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of Deferred Revenue (in millions) (unaudited) Three Months Ended December 24, September 24, 2017 2017 Beginning Balance $ 937.9 $ 966 Shipments 2,631.7 2,381.6 Revenue (2,580.8) (2,478.1) Net Change in Japan (1) 55.3 52.0 Services & Other 70.2 16.4 Ending Bal
Slide 20: Innovative Trusted Fast
A Innovative Trusted Fast \4