01—Abstract
Summary
Summary of the 10-K filed August 27, 2009. Cited figures are marked; the original filing is the authoritative source.
Lam Research Corporation (LRCX) reported a challenging fiscal year 2009, marked by a significant downturn in the semiconductor industry and global economic conditions.
Total revenue decreased by 55% year-over-year to $1.116 billiona, reflecting reduced customer demand. The company experienced a net loss of $302.1 million, a stark contrast to the prior year's profit, primarily due to the industry-wide slowdown, a $96.3 million goodwill impairment charge related to its Clean Product Group, and substantial restructuring costs. Despite the downturn, Lam Research continued to invest in research and development, focusing on its core etch technology and expanding into single-wafer clean markets.
The company is positioning itself for a future upturn, anticipating opportunities in equipment refurbishment and upgrades. The financial results highlight the cyclical nature of the semiconductor equipment industry and the company's vulnerability to macroeconomic factors and customer spending fluctuations. Lam Research ended the fiscal year with a solid cash position of $757.8 millionb, providing some liquidity buffer during this period.
02—Key points
Key Highlights
- Revenue declined significantly by 55% to $1.116 billion in fiscal year 2009 compared to $2.475 billion in fiscal year 2008, driven by a severe downturn in the semiconductor industry and global economic conditions.
- The company reported a net loss of $302.1 million for fiscal year 2009, a substantial decrease from a net income of $439.3 million in fiscal year 2008.
- A goodwill impairment charge of $96.3 million was recorded in fiscal year 2009, impacting the Clean Product Group due to a decline in fair value below its carrying value.
- Restructuring and asset impairment charges totaled $65.5 million in fiscal year 2009, reflecting efforts to align costs with the challenging economic environment.
- Despite the downturn, R&D expenses remained significant at $288.3 million, representing 25.8% of revenue, as the company continued to invest in technology development, particularly in etch and single-wafer clean.
- The company ended the fiscal year with a cash, cash equivalents, short-term investments, and restricted cash and investments balance of $757.8 million, indicating a focus on maintaining liquidity.
- International sales constituted a significant portion of revenue, approximately 85% in fiscal year 2009, highlighting the global nature of the semiconductor industry.
03—One dollar
Follow one dollar
For each $1.00 of revenue in FY2009, Lam Research Corp lost $0.27.
- Revenue$1.12B100.0%
- Cost of revenue−$727.2M65.2%
- Gross profit$388.7M34.8%
- Operating costs−$670.0M60.0%
- Operating income−$281.2M25.2%
- Interest, other & tax−$20.9M1.9%
- Net income−$302.1M27.1%
04—Financials
Financial Highlights
Figures from 10-KFY2009filed August 27, 2009Financial Statements
| Revenue | $1.12B |
| Cost of Revenue | $727.21M |
| Gross Profit | $388.73M |
| R&D Expenses | $288.27M |
| SG&A Expenses | $233.06M |
| Operating Expenses | $669.98M |
| Operating Income | -$281.24M |
| Interest Expense | $6.50M |
| Net Income | -$302.15M |
| EPS (Basic) | $-0.24 |
| EPS (Diluted) | $-0.24 |
| Shares Outstanding (Basic) | 1.26B |
| Shares Outstanding (Diluted) | 1.26B |
05—Questions
Frequently Asked Questions
What were the primary drivers for Lam Research's financial performance in fiscal year 2009?
The primary drivers were the severe cyclical downturn in the semiconductor industry and adverse global economic conditions, which led to a significant decrease in customer demand for wafer fabrication equipment. This resulted in a sharp decline in revenue and a net loss for the company.
How did the company manage its costs and operations in response to the downturn?
Lam Research implemented significant cost-saving measures, including substantial restructuring charges totaling $65.5 million to align its cost structure with the reduced business opportunities. The company also incurred a significant goodwill impairment charge of $96.3 million.
What is the company's strategic focus despite the challenging market conditions?
Lam Research continues to invest heavily in Research and Development, particularly in its core etch technology and in expanding its presence in the single-wafer clean market. The company also sees future opportunities in equipment refurbishment and upgrades as the market eventually recovers.
What is the company's financial position and liquidity outlook?
The company ended the fiscal year with a strong cash position of $757.8 million, which management believes is sufficient to support anticipated operations, investments, and debt service requirements for at least the next 12 months. However, the company acknowledges the ongoing uncertainty and potential for further negative impacts if market conditions deteriorate.
06—Continue