Lam Research Corporation · NASDAQ:LRCX
Lam Research — Q3 2019 Earnings Presentation
22 slides from Lam Research's earnings presentation, Oct 23, 2019
Slide 1: September Quarter 2019 Financial Results
Lam Research Corporation September Quarter 2019 Financial Results October 23, 2019 © 2019 Lam Research Corp. | 10.23.2019 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 Tim Archer President and Chief Executive Officer © 2019 Lam Research Corp. | 10.23.2019 3
Slide 4: September 2019 Quarter Results
Delivering Solid Results $2,166M 25.5% Revenue Operating Margin* September 2019 Quarter Results 45.4% $3.18 Gross Margin* Earnings per Share* *Data calculated on a non-GAAP basis. Reconciliations of U.S. GAAP results to non-GAAP results can be found at the end of this presentation. © 2019 Lam Resear
Slide 5: Industry Overview
Industry Overview Improving supply-demand environment in memory exiting 2019 Continued foundry/logic strength driven by 5G, CPU and IoT 2019 WFE spending increased to mid-$40 billion range 2020 is setting up to be a year of outperformance for Lam © 2019 Lam Research Corp. | 10.23.2019 5
Slide 6: Critical Enablers for 3D Scaling
Critical Enablers for 3D Scaling Deposition Etch Sole supplier of memory hole VECTOR® DT tool deposits backside dielectric capability films to control stress Production-proven edge-yield Striker® ALD tool deposits high- solutions quality liners and fill Enablement of new memory architectur
Slide 7: Long-Term Revenue Opportunity for Customer Support Business Group
Long-Term Revenue Opportunity for Customer Support Business Group Developing upgrades and advanced services that – Extend technical capability – Increase productivity Reliant® systems business achieved third consecutive quarterly revenue record © 2019 Lam Research Corp. | 10.23.2019 7
Slide 8: Solid Foundation for Outperformance
Summary Enabling 3D Device Technologies Solid Foundation for Executing on SAM & Share Growth Outperformance Building Installed Base Business © 2019 Lam Research Corp. | 10.23.2019 8
Slide 9: September Quarter 2019 Financial Results and December Quarter 2019 Outlook
September Quarter 2019 Financial Results and December Quarter 2019 Outlook Doug Bettinger Executive Vice President and Chief Financial Officer © 2019 Lam Research Corp. | 10.23.2019 9
Slide 10: September Quarter Results
September Quarter Results ► Revenue and EPS were both above midpoint of guidance for the September quarter Revenue Earnings per Share* $3.62 $2.36 $3.18 $2.17 Revenue ($B) EPS ($) Revenue Revenue QSep'19 QJun'19 QSep'19 QJun'19 *Data are presented on a non-GAAP basis. Reconciliations of U.S. GAAP re
Slide 11: September Quarter Revenue Mix
September Quarter Revenue Mix ► Foundry segment strong at 25% of systems revenue System Revenue Segments Revenue by Region Europe 3% Logic/Other 11% SEA Korea NVM 10% 21% U.S. 8% 38% Foundry 25% Revenue Revenue Japan 13% Taiwan 18% DRAM 26% Memory China 64% 27% NVM = Non-Volatile Memory © 2019 Lam R
Slide 12: September Quarter Financial Results
September Quarter Financial Results Sep’19 Jun’19 Revenue $2,166M $2,361M Non-GAAP Gross Margin* 45.4% 45.9% Non-GAAP Operating Expenses* $431M $450M Non-GAAP Operating Income* $552M $635M Non-GAAP Operating Income as a 25.5% 26.9% percentage of Revenue* Non-GAAP Other Expense, Net* $(11M) $(6M) Non
Slide 13: Key Balance Sheet and Financial Metrics
Key Balance Sheet and Financial Metrics Sep’19 Jun’19 Total Consolidated Gross Cash Balance $5,845M $5,686M Account Receivables, Net $1,636M $1,456M DSO 69 Days 56 Days Inventory Turns 3.2 3.3 Deferred Revenue* $481M $449M Capital Expenditures $39M $66M Equity Compensation Expense $43M $45M Amortiza
Slide 14: December 2019 Quarter Guidance
December 2019 Quarter Guidance $2.50B $150M 27.0% 1% Revenue Non-GAAP Operating Margin 45.0% 1% $3.80 $0.20 Non-GAAP Non-GAAP Gross Margin Earnings per Share* A reconciliation of U.S. GAAP projected results to non-GAAP projected results can be found at the end of this presentation *Based on
Slide 15: Questions and Answers
Questions and Answers © 2019 Lam Research Corp. | 10.23.2019 15
Slide 16: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income (in thousands, except per share data) (unaudited) Three Months Ended September 29, June 30, 2019 2019 U.S. GAAP net income $ 465,789 $ 541,825 Pre-tax non-GAAP items: Amortization related to intangible assets acq
Slide 17: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP Net Income to Non-GAAP Net Income (in thousands, except per share data) Twelve Months Ended (unaudited) December 29, 2019 (Projected) U.S. GAAP net income for the nine months ended September 29, 2019 $ 1,555,004 Pre-tax non-GAAP items: Amortizati
Slide 18: 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) Three Months Ended (unaudited) September 29, June 30, 2019 2019 U.S. GAAP gross margin $ 98
Slide 19: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP Other Expense, Net to Non-GAAP Other Expense, Net (in thousands) (unaudited) Three Months Ended September 29, June 30, 2019 2019 U.S. GAAP Other expense, net $ (12,728) $ (7,667) Pre-tax non-GAAP items: Amortization of note discounts 1,234 1,195
Slide 20: 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 September 29, June 30, 2019 2019 U.S. GAAP income before income taxes $ 524,727 $ 609,418 U.S. GAAP income tax expense $ 58,938 $ 67,593
Slide 21: Appendix – Reconciliation
Appendix – Reconciliation Reconciliation of U.S. GAAP to Non-GAAP Guidance for the December 2019 quarter U.S. GAAP Reconciling Items Non-GAAP Revenue $2.5 Billion +/- $150 Million — $2.5 Billion +/- $150 Million Gross margin as a percentage of revenue 44.9% +/- 1% $ 2 Million 45.0% +/- 1% Operating
Slide 22: VAA
VAA Innovative Technology Trusted Productivity Fast Solutions y NX