Lam Research Corporation (LRCX) has reported a 49.25 percent jump in profit for the quarter ended Dec. 25, 2016. The company has earned $332.79 million, or $1.81 a share in the quarter, compared with $222.98 million, or $1.28 a share for the same period last year.
Revenue during the quarter surged 32.04 percent to $1,882.30 million from $1,425.53 million in the previous year period. Gross margin for the quarter expanded 104 basis points over the previous year period to 44.99 percent. Total expenses were 76.63 percent of quarterly revenues, down from 83.25 percent for the same period last year. This has led to an improvement of 661 basis points in operating margin to 23.37 percent.
Operating income for the quarter was $439.83 million, compared with $238.83 million in the previous year period.
"Lam delivered another record for shipments, revenue, and net income in December, concluding a fifth consecutive year of revenue growth and outperformance when compared against the overall wafer fab equipment industry," said Martin Anstice, Lam Research's president and chief executive officer. "Lam's results occur through the hard work and commitment of our employees worldwide and the increasing strategic relevance and partnership established with our customers. Looking ahead to 2017, the combination of healthy end-demand in established business segments and new application drivers are setting the course for another year of industry growth and outperformance for Lam. We are inspired by the opportunity to deliver innovation to a transforming technology industry and semiconductor ecosystem."
For the third-quarter 2017, Lam Research Corporation forecasts revenue to be in the range of $2,050 million to $2,200 million. The company forecasts adjusted revenue to be in the range of $2,050 million to $2,200 million. The company forecasts operating income to grow in the range of 22.80 percent to 24.80 percent. The company forecasts adjusted operating income to grow in the range of 24.50 percent to 26.50 percent. The company expects diluted earnings per share to be in the range of $2.21 to $2.41. On an adjusted basis, the company expects diluted earnings per share to be in the range of $2.45 to $2.65.
Operating cash flow improves
Lam Research Corporation has generated cash of $877.32 million from operating activities during the first half, up 17.99 percent or $133.78 million, when compared with the last year period.
The company has spent $1,650.46 million cash to meet investing activities during the first six months as against cash outgo of $64.76 million in the last year period.
The company has spent $1,758.77 million cash to carry out financing activities during the first six months as against cash outgo of $208.98 million in the last year period.
Cash and cash equivalents stood at $2,503.96 million as on Dec. 25, 2016, up 27.24 percent or $536.09 million from $1,967.87 million on Dec. 27, 2015.
Working capital increases sharply
Lam Research Corporation has recorded an increase in the working capital over the last year. It stood at $5,845.86 million as at Dec. 25, 2016, up 31.45 percent or $1,398.64 million from $4,447.22 million on Dec. 27, 2015. Current ratio was at 3.20 as on Dec. 25, 2016, up from 3 on Dec. 27, 2015.
Days sales outstanding went down to 61 days for the quarter compared with 70 days for the same period last year.
Days inventory outstanding has decreased to 45 days for the quarter compared with 102 days for the previous year period.
Debt moves up
Lam Research Corporation has witnessed an increase in total debt over the last one year. It stood at $2,726.61 million as on Dec. 25, 2016, up 14.64 percent or $348.23 million from $2,378.38 million on Dec. 27, 2015. Total debt was 23.67 percent of total assets as on Dec. 25, 2016, compared with 24.39 percent on Dec. 27, 2015. Debt to equity ratio was almost stable at 0.43 as on Dec. 25, 2016, when compared with the last year.
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