Upcoming AWS Coverage on KLA-Tencor

LONDON, UK / ACCESSWIRE / April 24, 2017 / Active Wall St. announces its post-earnings coverage on Lam Research Corp. (NASDAQ: LRCX). The Company released its third quarter fiscal 2017 results on April 18, 2017. The semiconductor equipment maker smashed passed top- and bottom-line expectations and also announced an accelerated share repurchase program worth $500 million in the upcoming quarter. Register with us now for your free membership at:

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One of Lam Research's competitors within the Semiconductor Equipment & Materials space, KLA-Tencor Corp. (NASDAQ: KLAC), is estimated to report earnings on April 25, 2017. AWS will be initiating a research report on KLA-Tencor following the release of its next earnings results.

Today, AWS is promoting its earnings coverage on LRCX; touching on KLAC. Get our free coverage by signing up to:

http://www.activewallst.com/register/

Earnings Reviewed

For the three months ended March 26, 2017, Lam Research generated revenues of $2.15 billion up 14% sequentially to $1.88 billion and 63.9% on a y-o-y basis to $1.41 billion. The Company's revenue numbers exceeded analysts' consensus of $2.13 billion.

For Q3 FY17, Lam Research's total system shipments were $2.41 billion, up 25% compared to shipments of $1.92 billion reported in Q2 FY17.

For Q3 FY17, Lam Research's GAAP gross margin totaled 45.1%, while GAAP operating margin was 25.0%. The Company's non-GAAP gross margin was 46.1% for the reported quarter and non-GAAP operating margin was 26.9%, reflecting an increase of 83 basis points compared to Q2 FY17.

Lam Research's GAAP net income was $574.7 million, or $3.10 per share, for Q3 FY17 compared with $332.8 million, or $1.81 per share, in Q2 FY17 and $143.5 million, or $0.82 per share, in Q3 FY16. Earnings, adjusted for one-time gains and costs totaled $2.80 per share. The earnings results surpassed Wall Street's expectations of $2.54 per share.

Revenues by Geography

On a geographical basis, during Q3 FY17, Korea contributed 34% of Lam Research revenue and 35% of shipments and Taiwan accounted for 28% of revenue and 22% of shipments respectively. Japan and China each contributed 11% of Q3 FY17 revenues and 15% of shipments, respectively. The US, Europe, and Southeast Asia generated revenue of 9%, 4%, and 3%, and shipments of 7%, 3%, and 3%, respectively.

Financial Details

Lam Research's cash and cash equivalents, short-term investments, and restricted cash and investments balances totaled $6.14 billion at the end of the March 2017 compared to $6.09 billion at the end of the December 2016 quarter. Cash flows from operating activities during the reported quarter of $423 million were primarily utilized for approximately $216 million of share repurchases, including net share settlement on employee stock-based compensation; approximately $69 million of principal payments on debt, primarily related to our convertible notes; approximately $73 million of dividends paid to stockholders; and approximately $44 million of capital expenditures.

Lam Research's deferred revenue at the end of Q3 FY17 increased to $842 million compared to $673 million at the end of Q2 FY17. The Company's deferred profit at the end of the March 2017 quarter increased to $527 million compared to $408 million at the end of the December 2016 quarter. Lam's deferred revenue balance does not include shipments to Japanese customers, to whom title does not transfer until customer acceptance. Shipments to Japanese customers are classified as inventory at cost until the time of acceptance. The estimated future revenue from shipments to Japanese customers was approximately $260 million as of March 26, 2017, compared to $129 million as of December 25, 2016.

Lam Research returned $213 million to its shareholders in Q3 FY17, $73 million in dividend distributions, and $140 million in share repurchases. The Company took delivery of 1.2 million shares at an average price of $114.30 and has completed approximately 20% of its current $1 billion share repurchase authorization, and Lam Research announced that it plans to initiate a $500 million accelerated share repurchase program in Q4 FY17.

Guidance

For the quarter ending in June, Lam Research expects another record shipment of $2.500 billion, plus or minus $100 million. The Company is forecasting record revenue of $2.300 billion, plus or minus $100 million. Lam Research is expecting gross margin of 46%, plus or minus 1%, and operating margins of 27%, plus or minus 1%. The Company is projecting earnings per share of $3.00, plus or minus $0.12 based on a share count of approximately 180 million shares.

Stock Performance

On Friday, April 21, 2017, the stock closed the trading session at $139.98, marginally climbing 0.44% from its previous closing price of $139.36. A total volume of 3.26 million shares have exchanged hands, which was higher than the 3-month average volume of 1.78 million shares. Lam Research's stock price rallied 25.07% in the last three months, 41.52% in the past six months, and 75.83% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have surged 32.90%. The stock is trading at a PE ratio of 17.85 and has a dividend yield of 1.29%.

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SOURCE: Active Wall Street