Summary
Lam Research Corporation (LRCX) reported a slight increase in revenue for the three months ended September 25, 2016, reaching $1.632 billion, a marginal rise from $1.600 billion in the same period last year. Despite the revenue growth, net income saw a decrease to $263.8 million from $288.7 million year-over-year. This was largely driven by increased operating expenses, particularly in Selling, General and Administrative (SG&A) costs, and a higher income tax expense. The company's balance sheet shows a healthy increase in cash and cash equivalents, rising to $5.86 billion, indicating strong liquidity. Management noted that revenue growth in the quarter was primarily fueled by foundry customers increasing capacity and technology investments, with expectations for continued demand strengthening. The company continues to invest in R&D to address technology inflections like 3D NAND and FinFET transistors, aiming to expand its served addressable market. The termination of the KLA-Tencor merger in October 2016 also had financial implications, including the redemption of certain senior notes.
Financial Highlights
55 data points| Revenue | $1.63B |
| Cost of Revenue | $916.22M |
| Gross Profit | $716.20M |
| R&D Expenses | $235.24M |
| SG&A Expenses | $165.01M |
| Operating Expenses | $400.25M |
| Operating Income | $315.95M |
| Interest Expense | $41.43M |
| Net Income | $263.83M |
| EPS (Basic) | $0.16 |
| EPS (Diluted) | $0.15 |
| Shares Outstanding (Basic) | 1.61B |
| Shares Outstanding (Diluted) | 1.80B |
Key Highlights
- 1Revenue for the quarter increased slightly to $1.632 billion from $1.600 billion in the prior year's comparable quarter.
- 2Net income decreased to $263.8 million from $288.7 million year-over-year, impacted by higher operating expenses and taxes.
- 3Diluted Earnings Per Share (EPS) declined to $1.47 from $1.66 in the prior year's quarter.
- 4Cash and cash equivalents significantly increased to $5.86 billion, up from $1.74 billion at the end of the same period last year, indicating strong liquidity.
- 5Gross margin percentage slightly decreased to 43.9% from 45.1% year-over-year, attributed to unfavorable changes in customer and product mix.
- 6Foundry customers drove increased investments and shipments in the current quarter, with management expecting further demand strengthening.
- 7The company continues to invest heavily in R&D, with R&D expenses remaining substantial at $235.2 million.