What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-10-23 compared with 2023-04-24 · 119 added, 99 removed, 158 unchanged (58% of the section changed)

8 unchanged sentences

growth or decline in the industry and the market for, and spending on, wafer fabrication equipment;

the anticipated levels of, and rates of change in, margins, market share, served addressable market, capital expenditures, research and development expenditures, international sales, revenue (actual and/or deferred), operating expenses and earnings generally;

the anticipated levels of, and rates of change in, margins, market share, served available market, capital expenditures, research and development expenditures, international sales, revenue (actual and/or deferred), operating expenses and earnings generally;

management’s plans and objectives for our current and future operations and business focus;

restructuring activities;

business process improvements and initiatives;

volatility in our quarterly results;

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and the sufficiency of our financial resources or liquidity to support future business activities (including but not limited to operations, investments, debt service requirements, dividends, and capital expenditures).

Such statements are based on current expectations and are subject to risks, uncertainties, and changes in condition, significance, value, and effect, including without limitation those discussed below under the heading “Risk Factors” within Part II Item 1A and elsewhere in this report and other documents we file from time to time with the Securities and Exchange Commission (“SEC”), such as our annual report on Form 10-K for the year ended June 26, 2022 (our “2022 Form 10-K”), our quarterly reports on Form 10-Q for the fiscal quarters ended September 25, 2022 and December 25, 2022, and our current reports on Form 8-K.

Such statements are based on current expectations and are subject to risks, uncertainties, and changes in condition, significance, value, and effect, including without limitation those discussed below under the heading “Risk Factors” within Part II Item 1A and elsewhere in this report and other documents we file from time to time with the Securities and Exchange Commission (“SEC”), such as our annual report on Form 10-K for the year ended June 25, 2023 (our “2023 Form 10-K”), and our current reports on Form 8-K.

Such risks, uncertainties, and changes in condition, significance, value, and effect could cause our actual results to differ materially from those expressed in this report and in ways not readily foreseeable.

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Documents To Review In Connection With Management’s Discussion and Analysis Of Financial Condition and Results Of Operations

For a full understanding of our financial position and results of operations for the three and nine months ended March 26, 2023, and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations below, you should also read the Condensed Consolidated Financial Statements and notes presented in this Form 10-Q and the financial statements and notes in our 2022 Form 10-K.

For a full understanding of our financial position and results of operations for the three months ended September 24, 2023, and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations below, you should also read the Condensed Consolidated Financial Statements and notes presented in this Form 10-Q and the financial statements and notes in our 2023 Form 10-K.

Lam Research Corporation 2024 Q1 10-Q 17

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and (v) our focus on delivering our multi-product solutions with a goal to enhance the value of Lam’s solutions to our customers.

In the quarter-ended March 26, 2023, customer demand weakened due to wafer fabrication equipment spending reductions resulting primarily from incremental demand weakness in memory.

We did, however, continue to see improvement in supply chain constraints and were able to fulfill shipments of nearly all our outstanding back order systems.

As a result of expected reduced business levels we initiated a restructuring plan in the March 2023 quarter designed to better align the Company’s cost structure with its outlook.

We incurred a charge for the workforce actions associated with the restructuring plan in the March quarter of approximately $98.5 million.

Over the course of calendar year 2023, we are projecting expenditures in the range of $250 million associated with various business process improvements and initiatives, inclusive of the March 2023 quarter restructuring activity.

Risks and uncertainties related to the COVID-19 pandemic, supply chain challenges, and inflationary pressures may continue to negatively impact our revenue and gross margin.

Over the longer term, we believe that secular demand for semiconductors combined with technology inflections in our industry, including 3D device scaling, multiple patterning, process flow, and advanced packaging chip integration, will drive sustainable growth and lead to an increase in the served addressable market for our products and services in the deposition, etch, and clean businesses.

Overall calendar year 2023 customer demand weakened due to wafer fabrication equipment spending reductions resulting primarily from weakness in the memory market.

In addition, the U.S.

government’s restrictions on sales of equipment, parts and service for specific technologies and customers in China further impacted equipment demand in the year.

As a result of the reduced business levels in calendar year 2023, we initiated a restructuring plan in the quarter ended March 26, 2023 designed to better align the Company’s cost structure with our outlook.

We incurred a charge for the workforce actions associated with the restructuring plan of approximately $107.1 million in the second half of fiscal year 2023 and $5.5 million in the September 2023 quarter.

We continue to work towards a number of business process improvements and initiatives and expect to incur expenditures in the range of $250 million, inclusive of the restructuring activity.

Risks and uncertainties related to trade restrictions and the semiconductor demand environment may continue to negatively impact our revenue and operating margin.

Over the longer term, we believe that secular demand for semiconductors, combined with technology inflections in our industry, including 3D device scaling, multiple patterning, process flow, and advanced packaging chip integration, will drive sustainable growth and lead to an increase in the served available market for our products and services in the deposition, etch, and clean businesses.

Lam Research Corporation 2024 Q1 10-Q 18

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Three Months Ended

2023 December 25,

September 24,

2023 June 25,

(in thousands, except per share data and percentages)

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Diluted net income per share $ 6.66 $ 5.97

In the March 2023 quarter, reve nue decreased 27% compared to the December 2022 quarter, driven by a decrease in both systems and customer-support related revenue as a result of the weakening demand environment, compounded by regulatory trade restrictions imposed on shipments of wafer fabrication equipment and related parts and service to certain customers in China.

The deferred revenue balance was $2,002.7 million at the end of the March 2023 quarter, consistent with the balance at the end of the December 2022 quarter of $1,984.0 million.

Advanced deposit additions from newer customers increased during the March 2023 quarter, offsetting the decline in deferred balances related to shipments we completed of tools that had critical parts outstanding.

In the September 2023 quarter, reve nue increased 9% compared to the June 2023 quarter, primarily as a result of increased investments in the DRAM segment as well as increased spending by our China customers for mature node equipment.

The deferred revenue balance was $1,690.4 million at the end of the September 2023 quarter, a decrease to the balance at the end of the June 2023 quarter of $1,837.9 million, primarily due to a decrease in advanced deposits.

We aim to balance the requirements of our customers with the availability of resources, as well as performance to our operational and financial objectives.

As a result, from time to time, we exercise discretion and judgment as to the timing and prioritization of manufacturing and deliveries of products, which has impacted, including in the current fiscal year, and may in the future impact, the timing of revenue recognition with respect to such products.

The decrease in gross margin as a percentage of revenue in the March 2023 quarter compared to the December 2022 quarter was primarily a result of costs associated with restructuring related activities and product rationalization charges, as well as unfavorable absorption costs due to lower business volumes and customer and product mix.

The decrease in operating expenses in the March 2023 quarter compared to the December 2022 quarter was primarily driven by decreases in outside service spending and supplies expense, partially offset by an increase in restructuring related charges, employee-related expenses from seasonality, product rationalization costs and transformational costs.

Our cash and cash equivalents, investments, and restricted cash and investments balances increased to $5.6 billion at the end of the March 2023 quarter compared to $4.8 billion at the end of the December 2022 quarter.

This increase was primarily the result of $1,726.4 million of cash generated from operating activities, partially offset by $581.9 million of share repurchases, including net share settlement of employee stock-based compensation, $234.0 million of dividends paid to stockholders;

and $119.5 million of capital expenditures.

Employee headcount as of March 26, 2023 was approximately 18,700.

We expect the employee headcount balance to decrease further in the June 2023 quarter as many of the employees impacted by our restructuring activity have termination dates in early April.

As a result, from time to time, we exercise discretion and judgment as to the timing and prioritization of manufacturing and delivery of products, which has impacted, and may in the future impact, the timing of revenue recognition with respect to such products.

The increase in gross margin as a percentage of revenue in the September 2023 quarter compared to the June 2023 quarter was primarily due to favorable customer mix, partially offset by unfavorable factory absorption costs.

The increase in operating expenses in the September 2023 quarter compared to the June 2023 quarter was primarily driven by increases in employee-related costs, supplies expense, and outside service spending, partially offset by a decrease in deferred compensation plan-related costs.

Our cash and cash equivalents, investments, and restricted cash and investments balances decreased to $5.2 billion at the end of the September 2023 quarter compared to $5.6 billion at the end of the June 2023 quarter.

This decrease was primarily the result of $843.2 million of share repurchases, including net share settlement of employee stock-based compensation;

$253.1 million of repayment of debt, largely associated with the purchase of certain properties under finance leases;

and $230.3 million of dividends paid to stockholders, partially offset by $951.2 million of cash generated from operating activities.

Employee headcount as of September 24, 2023 was approximately 17,200.

RESULTS OF OPERATIONS

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

Revenue (in millions) $ 3,482 $ 3,207 $ 5,074

Korea 22 % 20 % 20 % 23 %

China 48 % 26 % 30 %

Taiwan 18 % 19 % 20 % 16 %

United States 16 % 10 % 9 % 6 %

Korea 16 % 24 % 17 %

Japan 9 % 10 % 9 %

United States 8 % 8 % 6 %

Taiwan 7 % 20 % 22 %

Europe 7 % 8 % 5 %

Southeast Asia 5 % 4 % 11 %

Revenue for the March 2023 quarter decreased 27% from the December 2022 quarter primarily from reductions in wafer fabrication equipment spending as well as from regulatory trade restrictions imposed on shipments of wafer fabrication equipment and related parts and services to China.

Revenue for the September 2023 quarter increased 9% from the June 2023 quarter primarily as a result of increased investments in the DRAM segment as well as increased spending by our China customers for mature node equipment.

Lam Research Corporation 2024 Q1 10-Q 19

The following table presents our revenue disaggregated between system and customer support-related revenue:

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(In thousands)

System revenue $ 2,256,033 $ 3,547,518 $ 8,985,538 $ 8,315,898

Systems revenue $ 2,056,655 $ 1,710,359 $ 3,181,987

Customer support-related revenue and other 1,425,407 1,496,898 1,892,134

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Please refer to Note 3, “Revenue,” to the Condensed Consolidated Financial Statements of this Form 10-Q for additional information regarding the composition of the two categories into which revenue has been disaggregated.

The following table presents the percentages of leading- and non-leading-edge equipment and upgrade revenue to each of the primary markets we serve:

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

The percentage of leading- and non-leading-edge equipment and upgrade revenue from each of the markets we serve was as follows:

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

Memory 38 % 27 % 52 %

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Logic/integrated device manufacturing 26 % 26 % 14 %

The decrease in the memory market for the nine months ended March 26, 2023 as compared to the same period in 2022, is primarily due to decreases in NAND investments by our customers during this time period.

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

The decrease in the memory market for the three months ended September 24, 2023 as compared to the same period in 2022, is primarily due to decreases in NAND spending by our customers during this time period.

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(in thousands, except percentages)

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Percent of revenue 47.5 % 45.5 % 46.1 %

Gross margin as a percentage of revenue was lower in the March 2023 quarter compared to the December 2022 quarter primarily due to $66.7 million in restructuring-related charges and $26.8 million in costs associated with product rationalization, as well as unfavorable customer and product mix.

The decrease in gross m argin as a percentage of revenue in the nine months ended March 26, 2023 compared to the same period in the prior year was primarily driven by costs associated with restructuring related activities, product rationalization, as well as higher levels of manufacturing-related spending as a result of increased inflationary pressures, partially offset by favorable customer and product mix.

Gross margin as a percentage of revenue was higher in the September 2023 quarter compared to the June 2023 quarter primarily due to favorable customer mix partially offset by unfavorable factory absorption costs.

The increase in gross m argin as a percentage of revenue in the three months ended September 24, 2023 compared to the same period in the prior year was primarily due to favorable customer mix as well as reduced spending on material costs, freight and logistics, partially offset by unfavorable factory utilization.

Research and Development

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(in thousands, except percentages)

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Percent of revenue 12.1 % 12.5 % 8.5 %

We co ntinued to make significant R&D investments in the March 2023 quarter focused on leading-edge deposition, etch, clean and other semiconductor manufacturing processes.

The decrease in R&D expense in the March 2023 quarter compared to the December 2022 quarter was primarily driven by a decrease of $22.1 million in supplies expense and $11.5 million in outside services.

We co ntinued to make significant R&D investments in the September 2023 quarter focused on leading-edge deposition, etch, clean and other semiconductor manufactu ring processes.

The increase in R&D expense in the September 2023 quarter compared to the June 2023 quarter was primarily driven by increases in supplies and employee-related costs, partially offset by a decrease in deferred compensation plan-related costs.

The decrease in R&D expense in the three months ended September 24, 2023 compared to the same period in the prior year was primarily driven by a decrease in outside service spending and lower employee-related costs.

Lam Research Corporation 2024 Q1 10-Q 20

The increase in R&D expense in the nine months ended March 26, 2023 compared to the same period in the prior year was primarily driven by a $46.8 million increase in employee-related expenses mainly as a result of increased headcount and a $31.9 million increase in spending for supplies.

Selling, General, and Administrative

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(in thousands, except percentages)

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Percent of revenue 5.9 % 6.2 % 4.1 %

SG&A expense during the March 2023 qua rter decreased in comparison to the December 2022 quarter, primarily driven by a decrease of $24.5 million in outside service spending.

SG&A expense during the nine months ended March 26, 2023 decreased compared to the same period in the prior year, primarily driven by a decrease of $34.6 million in amortization for intangible assets, as the intangible assets associated with our Novellus Systems, Inc.

transactions have fully amortized.

SG&A expense during the September 2023 qua rter increased in comparison to the June 2023 qua rter, primarily driven by an increase in employee-related costs.

SG&A expense during the three months ended September 24, 2023 is flat to the same period in the prior year.

Restructuring Charges, Net

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(in thousands, except percentages)

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Percent of revenue 0.3 % 0.4 % — %

In the three and nine months ended March 26, 2023, we initiated a restructuring plan designed to better align our cost structure with our outlook for the economic environment and business opportunities.

During fiscal year 2023, we initiated a restructuring plan designed to better align our cost structure with our outlook for the economic environment and business opportunities.

Under the plan we terminated approximately 1,650 employees, incurring expenses related to employee severance and separation costs.

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Additionally, we made a strategic decision to relocate certain manufacturing activities to pre-existing facilities.

During the three and nine months ended March 26, 2023 net restructuring costs of $66.7 million and $40.4 million were recorded in restructuring charges, net - cost of goods sold, and restructuring charges, net - operating expenses, respectively of our Condensed Consolidated Financial Statements, included in Part I of this Form 10-Q.

The restructuring charges in the September 2023 quarter decreased compared to the June 2023 quarter, due to the timing of employee separation activities.

No restructuring charges were recognized during the three months ending September 25, 2022.

During the three months ended September 24, 2023 net restructuring costs of $7.9 million and $2.0 million were recorded in restructuring charges, net - cost of goods sold, and restructuring charges, net - operating expenses, respectively in our Condensed Consolidated Financial Statements, included in Part I of this Form 10-Q.

Please refer to Note 15, “Restructuring charges, net,” to our Condensed Consolidated Financial Statements, included in Part I of this Form 10-Q for additional information.

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Other income (expense), net consisted of the following:

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(in thousands)

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Interest expense (45,331) (46,532) (46,052)

Gains (losses) on deferred compensation plan-related assets, net 5,443 10,871 3,588 (5,737)

Foreign exchange (losses) gains, net (5,519) (10,114) (8,812) 1,657

(Losses) gains on deferred compensation plan-related assets, net (2,901) 16,598 (12,726)

Foreign exchange gains (losses), net 1,269 1,734 6,821

Other, net (7,000) (18,619) (6,194)

$ 2,601 $ 9,010 $ (43,095)

Interest income increased for the March 2023 quart er compared to the December 2022 quarter, primarily because of higher yields and higher average balances.

Interest income increased for the nine months ended March 26, 2023, compared to the same period in 2022, primarily because of higher yields.

Lam Research Corporation 2023 Q3 10-Q 26

Interest income increased in the September 2023 quarter as compared to the June 2023 quarter, primarily due to higher average yields partially offset by lower average cash balances.

Interest income increased for the three months ended September 24, 2023, compared to the same period in 2022, because of higher average yields and higher average cash balances.

Interest expense is consistent across all periods presented.

The gains and losses on deferred compensation plan-related assets were driven by fluctuations in the fair market value of the underlying funds for all periods presented.

The gains and losses on deferred compensation plan-related assets, net were driven by fluctuations in the fair market value of the underlying funds for all periods presented.

Lam Research Corporation 2024 Q1 10-Q 21

Foreign exchange fluctuations were primarily due to currency movements against portions of our unhedged balance sheet exposures for all periods presented.

The gains and losses in other, net for the three and nine months ended March 26, 2023, were driven by fluctuations in fair value of equity investments.

For the nine months ended March 27, 2022, other, net includes an unrealized gain totaling $63.6 million associated with an equity investment that completed a business combination and public offering during that period.

The losses in other, net for the September 2023 quarter were lower compared to the June 2023 quarter, primarily driven by fluctuations in the fair market value of equity investments.

The losses in other, net for the three months ended September 24, 2023, were flat compared to same period in 2022.

Income Tax Expense

Our provision for income taxes and effective tax rate for the periods indicated were as follows:

Three Months Ended Nine Months Ended

2023 December 25,

2022 March 26,

2023 March 27,

Three Months Ended

September 24,

2023 June 25,

2023 September 25,

(in thousands, except percentages)

1 unchanged sentence

Effective tax rate 13.5 % 7.1 % 13.8 %

The increase in the effective tax rate for the March 2023 quarter compared to the December 2022 quarter was primarily due to the change in level and proportion of income in higher and lower tax jurisdictions, recognition of previously unrecognized tax benefits from lapses of statutes of limitation, and a net tax benefit associated with legal entity restructuring in the December 2022 quarter.

The increase in the effective tax rate for the nine months ended March 26, 2023 compared to the same period in the prior year was primarily due to the change in level and proportion of income in higher and lower tax jurisdictions and lower stock-based compensation excess tax benefits in the nine months ended March 26, 2023.

The increase in the effective tax rate for the September 2023 quarter compared to the June 2023 quarter was primarily due to the change in level and proportion of income in higher and lower tax jurisdictions, and the recognition of previously unrecognized tax benefits from lapses of statutes of limitation in the June 2023 quarter.

The effective tax rate for the September 2023 quarter compared to the same period in the prior year remained consistent.

International revenues account for a significant portion of our total revenues, such that a material portion of our pre-tax income is earned and taxed outside the United States.

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Please refer to Note 7, “Income Taxes,” to our Consolidated Financial Statements in Part II, Item 8 of our 2023 Form 10-K for additional information.

On August 16, 2022, the IRA was signed into law.

In general, the provisions of the IRA are effective beginning with our fiscal year 2024, with certain exceptions.

The IRA includes a new 15% corporate minimum tax.

We have evaluated the potential impacts of the IRA and do not expect it to have a material impact on our effective tax rate.

However, we expect future guidance from the Treasury Department and will further analyze when the guidance is issued.

We re-evaluate uncertain tax positions on a quarterly basis.

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CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Refer to our “Critical Accounting Policies and Estimates” included in Part II, Item 7 of our 2022 Form 10-K for a discussion of our critical accounting policies and estimates.

A critical accounting policy is defined as one that has both a material impact on our financial condition and results of operations and requires us to make difficult, complex and/or subjective judgments, often as a result of the need to make estimates about matters that are inherently uncertain.

The preparation of financial statements in conformity with U.S.

generally accepted accounting principles (“GAAP”) requires management to make certain judgments, estimates and assumptions that could affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.

We base our estimates and assumptions on historical experience and on various other assumptions we believe to be applicable and evaluate them on an ongoing basis to ensure they remain reasonable under current conditions.

Actual results could differ significantly from those estimates, which could have a material impact on our business, results of operations, and financial condition.

Our critical accounting estimates include:

• the recognition and valuation of revenue from arrangements with multiple performance obligations which impacts revenue;

• the valuation of inventory, which impacts gross margin;

• the recognition and measurement of current and deferred income taxes, including the measurement of uncertain tax positions, which impact our provision for income tax expenses;

• the valuation and recoverability of long-lived assets, which impacts gross margin and operating expenses when we record asset impairments or accelerate their depreciation or amortization.

Refer to our “Critical Accounting Policies and Estimates” included in Part II, Item 7 of our 2023 Form 10-K for a discussion of the critical accounting estimates identified above.

Lam Research Corporation 2024 Q1 10-Q 22

Recent Accounting Pronouncements

For a description of recent accounting pronouncements, including the expected dates of adoption and estimated effects, if any, on our Condensed Consolidated Financial Statements, see Note 2 - Recent Accounting Pronouncements, of our Condensed Consolidated Financial Statements, included in Part 1 of this Form 10-Q.

See Note 2 - Recent Accounting Pronouncements, of our Condensed Consolidated Financial Statements, included in Part 1 of this Form 10-Q.

LIQUIDITY AND CAPITAL RESOURCES

Total gross cash, cash equivalents, investments, and restricted cash and investments balances were $5.6 billion at March 26, 2023 compared to $3.9 billion as of June 26, 2022.

This increase was primarily driven by $4,056.2 million of cash generated from operating activities, partially offset by $1,148.0 million of share repurchases, including net share settlement on employee stock-based compensation;

$675.6 million in dividends paid;

and $422.9 million of capital expenditures.

Lam Research Corporation 2023 Q3 10-Q 27

Net cash provided by operating activities of $4,056.2 million during the nine months ended March 26, 2023, consisted of (in thousands):

Total gross cash, cash equivalents, investments, and restricted cash and investments balances were $5.2 billion at September 24, 2023 compared to $5.6 billion as of June 25, 2023.

This decrease was primarily driven by $843.2 million of share repurchases, including net share settlement on employee stock-based compensation;

$253.1 million of repayment of debt largely associated with the purchase of certain properties under finance leases;

and $230.3 million in dividends paid;

partially offset by $951.2 million of cash generated from operating activities.

Net cash provided by operating activities of $951.2 million during the three months ended September 24, 2023, consisted of (in thousands):

Net income $ 887,398

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Significant changes in operating asset and liability accounts, net of foreign exchange impact, included the following uses of cash:

increases in inventory of $964.0 million, along with a decrease in trade accounts payable of $392.0 million, and accrued expenses and other liabilities of $101.5 million.

decreases in deferred profit of $100.1 million, and accrued expenses and other liabilities of $39.8 million, along with an increase in prepaid expenses and other current assets of 43.8 million.

The uses of cash are offset by the following sources of cash:

decreases in accounts receivable of $1,058.5 million, deferred profit of $268.9 million, and prepaid expense and other assets of $128.5 million.

increase in accounts payable of $53.5 million along with decreases in inventory of $51.7 million and accounts receivable of $9.0 million.

Cash Flow from Investing Activities

Net cash used for investing activities during the nine months ended March 26, 2023, was $479.4 million, primarily consisting of $422.9 million in capital expenditures and $120.0 million of net cash disbursed for business acquisitions, partially offset by proceeds from maturities of available-for-sale securities of $71.9 million.

Net cash used for investing activities during the three months ended September 24, 2023, was $74.7 million, primarily consisting of $77.0 million in capital expenditures, partially offset by proceeds from maturities of available-for-sale securities of $7.3 million.

Cash Flow from Financing Activities

Net cash used for financing activities during the nine months ended March 26, 2023, was $1,792.7 million, primarily consisting of $1,148.0 million in treasury stock repurchases, including net share settlement on employee stock-based compensation, and $675.6 million in dividends paid, partially offset by $52.7 million combined proceeds from issuance of common stock.

Net cash used for financing activities during the three months ended September 24, 2023, was $1.3 billion, primarily consisting of $843.2 million in treasury stock repurchases, including net share settlement on employee stock-based compensation, $253.1 million of repayment of debt, largely associated with the purchase of certain properties under finance leases, and $230.3 million in dividends paid.

Given that the semiconductor industry is highly competitive and has historically experienced rapid changes in demand, we believe that maintaining sufficient liquidity reserves is important to support sustaining levels of investment in R&D and capital infrastructure.

Anticipated cash flows from operations based on our current business outlook, combined with our current levels of cash, cash equivalents, and short-term investments as of March 26, 2023, are expected to be sufficient to support our anticipated levels of operations, investments, debt service requirements, capital expenditures, capital redistributions, and dividends through at least the next twelve months.

Anticipated cash flows from operations based on our current business outlook, combined with our current levels of cash, cash equivalents, and short-term investments as of September 24, 2023, are expected to be sufficient to support our anticipated levels of operations, investments, debt service requirements, capital expenditures, capital redistributions, and dividends through at least the next twelve months.

However, factors outside of our control, including uncertainty in the global economy and the semiconductor industry, as well as disruptions in credit markets, have in the past, are currently, and could in the future, impact customer demand for our products, as well as our ability to manage normal commercial relationships with our customers, suppliers, and creditors.

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We believe that, if necessary, we will be able to access the capital markets on terms and in amounts adequate to meet our objectives.

However, domestic and global macroeconomic and political conditions, or the ongoing COVID-19 pandemic, could cause disruptions to the capital markets and otherwise make any financing more challenging, and there can be no assurance that we will be able to obtain such financing on commercially reasonable terms or at all.

However, domestic and global macroeconomic and political conditions could cause disruptions to the capital markets and otherwise make any financing more challenging, and there can be no assurance that we will be able to obtain such financing on commercially reasonable terms or at all.

Lam Research Corporation 2024 Q1 10-Q 23

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis