Lam Research Corporation (NASDAQ:LRCX) Q3 2020 Earnings Conference Call - Final Transcript

Oct 21, 2020 • 05:00 pm ET

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Lam Research Corporation (NASDAQ:LRCX) Q3 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, and welcome to Lam Research's September Quarter Earnings Conference Call.

At this time, I would like to turn the conference over to Ms. Tina Correia, Corporate Vice President of Finance and Investor Relations. Please go ahead ma'am.

Executive
Tina Correia

Thank you, and good afternoon, everyone. Welcome to the Lam Research quarterly earnings conference call. With me today are Tim Archer, President and Chief Executive Officer; and Doug Bettinger, Executive Vice President and Chief Financial Officer.

During today's call, we will share our overview on the business environment and will review our financial results for the September 2020 quarter and our outlook for the December 2020 quarter. The press release detailing our financial results was distributed a little after 1 o'clock PM Pacific Time this afternoon. The release can also be found on the Investor Relations section of the company's website along with the presentation slides that accompany today's call. Today's presentation and Q&A includes forward-looking statements that are subject to risks and uncertainties reflected in the risk factors disclosed in our SEC public filings. Please see accompanying slides in the presentation for additional information.

Today's discussion of our financial results will be presented on a non-GAAP financial basis, unless otherwise specified. A detailed reconciliation between GAAP and non-GAAP results can be found in today's earnings press release. This call is scheduled to last until 3 o'clock PM Pacific Time. A replay of this call will be made available later this afternoon on our website.With that, I will hand the call over to Tim.

Executive
Tim Archer

Thank you, Tina, and welcome, everyone. Lam delivered very strong September quarter results. Revenues and gross margin came in above the midpoint of the guided range. Operating margin and diluted earnings per share exceeded the high end of the range. Our performance reflects solid execution across the company. The operating environment remains challenging, due to the COVID-19 pandemic, but the tremendous dedication of Lam's employees and our partners worldwide is enabling us to perform at a high level.

Notably, the September quarter marked record revenue and diluted earnings per share for the company and was also the first quarter in which we have exceeded $1 billion in revenue from our Customer Support Business Group. At the midpoint of our December quarter guidance, we will be growing EPS more than 35% year-over-year in 2020. Investments we are making in manufacturing and supply chain resilience are enabling us to meet customers' critical needs in a period of strong demand and are preparing us for the continued growth we see ahead.

Before I talk about market and product trends, I want to touch upon China-related trade regulations. As has been widely reporting, US regulations have impacted our ability to ship wafer fab equipment and parts to a large foundry customer in China. We are working with regulators on this issue and have applied for licenses to ship equipment and parts that are subject to the restrictions. As a result of the current situation, our December quarter guidance reflects an impact to