LRCX - Earnings call transcript Q4 2024 | Lam Research Corporation

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Operator

Good evening, and welcome to the Lam Research June Quarterly Earnings Call. [Operator Instructions] Please note, this call is being recorded. I would now like to turn the conference over to Mr. Ram Ganesh, VP Investor Relations. Please go ahead.

Ram Ganesh

afternoon, good and you, everyone. Thank Lam Welcome Earnings Call. Quarterly to the Conference Research Archer, today Chief Vice and me are President Bettinger, President Officer. Financial With Tim Chief Executive Doug and and Executive Officer;

X:XX review our call, today's the and our for our quarter we detailing June share outlook Investor p.m. September be financial section our Pacific The During results little was The overview website for press results also financial the release distributed release the presentation accompany will company's found the business after on the slides on Relations environment, XXXX a and the of can with we'll today's Time. XXXX along that call. quarter.

risk and that information. SEC forward-looking basis, statements our results unless otherwise Q&A accompanying risks public a are filings. presentation A presented Please and of financial in discussion include will additional disclosed in for factors be the presentation on see in to Today's financial the our slides Today's subject uncertainties specified. reflected non-GAAP detailed scheduled made reconciliation in on call call replay be can this This be this the later with X:XX presentation. GAAP call accompanying is results in of the to our the found Tim. last Pacific Time. website. over slides until will p.m. A I'll and afternoon And that, available to between non-GAAP hand

Timothy Archer

all earnings share, Lam set of guidance. another per delivered solid our in and Rob, quarter, midpoint revenues, In afternoon, good profitability with June Thanks, above of and the everyone. results the coming

revenues Our [indiscernible]. sequentially, led CSBG XX% by up and with growth strong Reliant business posted

goals factory track in the an chain new shipping expanded ramp manufacturing in supply footprint. Lam's key is of facility reduction and Malaysia on a global through long-term to side, its our we history, the On we This the our cost manufacturing a with fastest milestone and achieve achieved X,XXXth manufacturing remain chamber. quarter

global We these R&D is digital a operational where product customers our for infrastructure Lam, industry put a inflections, WFE of and expansion. XXXX at will we Lam of close period strategic transformation previously development believe As scale. key spending investments a as prioritizing in are outperform technology to into communicated, year for multiyear the investment moves to for position efficiency

WFE, billion we the to turning spending be to in this mid expect year's range. Now $XX

on investment DRAM customer generally is prior on high-bandwidth profile view, to expected the flat from additional a We our technologies related to China is stronger and Global apart spending all Our investments domestic memory from node unchanged NAND up capacity. spending foundry year-on-year mature or demand logic, be of roughly see ramp HBM slightly and basis. year-on-year.

XXXX, for Looking AI on yet to ahead in is AI HBM. demand training growth a business of and is be Today, environment we transformative power the WFE tool to is a see strong model for spending. driving realized. The GPUs focus still positive fully continued

looking devices as and the However, We and spur edge AI-enabled will lower cost will scale to installed for content bid that bias at edge growth Investments PCs use enterprise smartphones. customers well DRAM capacity cases spending AI expand, of anticipate low-power to toward storage the in we [indiscernible] base. play technology strengths. inferencing memory Lam's upgrades of particularly WFE believe and

Longer Lam integration, applications next-generation semiconductors each power by ratio greenfield alone, level innovation new serve at and investment. opportunity in for we set we including to device for significantly intensity successive to than upgrades dielectric AI-related process lines nodes. etch roughly positioned base Lam's higher chambers deposition our to memory, when technology are upgrade etch WFE efficient share sizable existing solutions advanced and the of X,XXX served NAND memory in increasingly to our for to etch play node. critical scaling, packaging outgrow and market efforts are and NAND, develop overall industry's expand For increase you more is a an delivering deposition term, the atomic installed to materials see and in production vital lower-cost When aspect tremendous role customers consider high faster,

our To yielding to solid-state first precise etch [indiscernible] exciting drivers reduce vertically coupled and shorts year, and our the structures [indiscernible] device matchless EUV new with or enabler error. critical plasma power for is to etch nature In our architectures combining is placement applications. end, to new the aspect stabilize focus transistor products, leakage. coupling the uniformity depth this industry standards. with XXXx emerging this pulsing current gate-all-around and unprecedented high ultra-small DRAM conductor This coupling edge oriented controller. power power By DRAM devices, Lam's etching and of R&D Similarly, [indiscernible] Direct to as due ratio are the faster with power for a plasma becoming Lam newly conductor direct delivering systems direct to best-in-class plasma capabilities, power source connects chamber With including need source avoid requires in known bias, [indiscernible] latest the of profile silicon tool conductor direct bitline placement unique uses etch for performance than patterning pulsing, Drive. of

roughly nodes nanometers. X requirement than tighter For nanometers, control XX% X for below the is at

to which a tool contributors new reduction X etch Our error. the delivers etch main in is XX% roughness, placement feature of conductor

reduce to X given can cost and capability a X we the the dose, of patterning customers orders EUV helping improve EUV addition, of In in magnitude the improvement for overall process. further achieve defectivity

arrays of QLC scaling is developing vertical AI per demand driving of and to support these of NAND sell pursuing Lam and etch efforts, PLC dielectric deposition through manned Turning applications NAND. bits faster, and higher-capacity SSDs. as for implementation stored enterprise In are technologies. increasing new makers capabilities. as well lateral are both

per generation top-to-bottom Vantec Lam are X,XXX a reduction a delivering channel Cryo per industry-leading delivering etch Lam addresses fabs per When profile bit for today, deviation to control memory to our on has or customers tier. NAND the is on nearly a running etch XX of in and patented energy need Lam by profile our flexibility of available relative packing Earlier more textures. from to XX% greenhouse having wafer highest new X.X, more cryogenic wafer solutions, the create gas layers tight a etch density industry's to can delivers channel X.X reduction increase less than our control per process X.X% third hole industry's cryogenic also while XX% worldwide. chambers, consumption allows deployed technology. depth. its non-cryogenic nanometers energy, announced we the in of a add etch than hole in less the profile. emissions Lam's we more ion learning Cryo sustainable system, cryogenic deep that compared also Building man Such X.X XX-micron Cryo cells This layer

resulted been overlay, is provides of impacting and NAND. fill technology quickly dimensions these and typically innovative negatively performance. material. Ram's materials to and have multi-tier attractive tier Polysilicon gap fill in and poor high control also to support materials, stacking. Integration stacking cost process through tungsten yield Deposition of alternative has PECVD-based an increased critical however, in pure layer carbon gap advancing enable density bit and used lower count

mechanical of to traditional superior XX% removability, reduces With etch cases it unique steps selectivity, number dry by required the approaches. also process of compared and some post properties the high combination simplified in process approximately

addressing growing becoming etch the complex are and increasingly environment. AI of to semiconductor critical Overall, requirements a deposition

the for [indiscernible] opportunities especially inflections delivery, by gate by excited company, are backside advanced power all and the those we We of technology processing. breadth see to created around ahead packaging

our a are each I'll are billion of financial our to represents sharing hold deposition next February $X and etch With as We and it long-term growth we higher fronts these our in Doug. intensive to All well over XXXX. on model Lam. progress to at planning which these Day, opportunity for look that, turn forward Investor as or

Douglas Bettinger

We you Good Thank you, XXXX executed thank and our afternoon, Tim. well joining quarter. the for June today. in everyone, call

results June quarter above the strong metrics. with came the midpoint financial all Our company's ranges or execution. our exceeded guidance were pleased for We in

percentage year in XX% and at free quite gross Lam XXXX, of we achieved generated XX.X% the with fiscal revenue. we in coming cash highest the or billion merging $X.X XXXX, For . Novelis of approximately margin of flow since strong

came the quarter guidance. was and an June prior from Revenue of midpoint details $X.XX the look the at over billion, of increase our which Let's quarter results. at in

revenue which is the billion, me, balance end revenue decrease a recognized at to -- or deferred of $X.XX in $XXX Our excuse the the that tied million customer quarter related of was to advanced payments. was quarter March

the remains at stable I As for levels future. here these we deferred foreseeable sit believe revenue today,

was in Let's the in revenue decrease of the XX% turn memory in attributable XX% was a DRAM level to the memory systems DRAM declined XX%, mainly just we revenue nonvolatile investment of as nodes as the the quarter from XX% revenue, in quarter. as which quarter revenue came in revenue with has mature fiscal investment investments June at prior XX%. and of a our DRAM in XXXX was systems since level with quarter node. in March non-ball specialty it at as the focused characterizing the year a well XX%. component the a DDRX on device. HBM in in segment details. a segment record reminder, new enablement was in The decline from memory on Nonvolatile And spending came quarter to systems which March down XY of June are compared reached customer's one DRAM.

devices point for offset low XX%. the year, was spending increased [indiscernible] with our segment in I gradually around quarter, and investment the The up level by our improve represented in this flat in decline in XX%. of normal strength rates slowly node to conversions other March by customers The roughly expect revenue China. increase of segment to and the XX was The nodes were levels, Xxx concentration layer was for June return at and quarter in from Net next a the in spending. revenue, XX% Foundry data XX% shipments in more all as of to year. a driven Growth system mature was NAND systems utilization X node mature of revenue which the into spending prior percentage

in XX% level approximately in which higher was and XX% in support X% XX% than calendar business was concentration XX% billion, quarter, $X.X composition an the the the March largest was quarter expectations With earnings down than came level bit our to geographic quarter the and total a little next at by XX%, higher the of spending. call. Korea June previous region versus was prior quarter. June customer The the our regional March XXXX. June from pulled quarter XX% prior revenue from the quarter in in China increase from China of Taiwan driven revenue, and of This June in domestic of the at quarter. from quarter, increase revenue revenue slightly the respect The the an the of XX% group

represented XX% followed in revenue revenues end spares. June CSBG quarter Reliant growth highest driven calendar reached point by an the the increase primarily since of and systems, of our XXXX, in by

Reliant well domestic as little Systems in and modestly do stocking. Spares largely revenue calendar strength revenue spending of in customers utilization China CSBG memory at as in for benefited mature year not due our XXXX. will Our nodes. from to improvement inventory think I grow continued increased a bit specialty

Let's look at profitability.

million, at June in top we Our that prior the $XXX call. down Operating of quarter million. and of talked our down the quarter. in quarter $XXX efficiencies, saw XX.X% about the gross headwind for at March amount improvement June quarter the June offset benefited last which in on margin gross earnings slightly guided from range quarter customer margin from continued marginally from came mix expenses XX.X% the were end factory we the largely in

development portfolio. mentioned, product and as total research to in As spending extend and out of our were we concentrated prioritize expenses well than research expand I'd to technology in development. that Tim as more XX% our differentiation just operating our point continue

mainly above range XX.X%, The margin strong gross of that because quarter was margin performance. June operating the guidance

expense level, Our variability the in of rate $XX the the OI&E $XX investments. estimate you The in million talked to fluctuate quarter in tax for rate our quarter primarily income XXXX past, in the see tax venture OI&E be non-GAAP the for XX.X%. in the rate with mid-teens we've quarter. this from and the quarter-to-quarter. in result value approximately remainder and year the will about income was increase fluctuations as compared was of in And quarter-to-quarter. June low to We will Other fair of for income was million in calendar March the the

$XXX to return. we June [indiscernible] Let's repurchases, and in share dividends $XXX capital We paid allocated million in million approximately quarter. the

share of announced the During $XX repurchase quarter, authorization. approved billion a we our that Board Directors

the at of $XX.X the in the end have billion June remaining plan We quarter.

cash guidance plans For June fiscal diluted with our XXX share of with capital returned earnings on $X.XX, expectations line per from the XX% range. of free quarter end of in billion million $X.X March to The diluted to close high track shares and flow, our share or the we XXX% returning of long-term XX% was cash were year our XXXX, down free which flow. was count quarter.

[indiscernible] outstanding balance bit were $X.X days of the with the of Cash the the June XX quarter days and billion little from cash June $X.X The inventory the of prior June sheet. at totaled in sales quarter. increase quarter. turns slight a X.Xx quarter. XX the a billion in March March X.Xx quarter, up end compared the end from equivalents in quarter, at

calendar continue we'll We of on are in year bringing the to this work XXXX. making progress throughout levels rest down, and inventory

States $XX for in in approximately expenses Asia, close expenditures amortization. to XX,XXX Asia ended centered $XX with and customers' lab and level regular mainly flat We manufacturing our $XX United manufacturing in compensation, the be quarter. our for million, quarter million quarter June noncash million development facilities was which approximately were in as Capital spending global full-time included June with supporting to flat the employees, equity the March and on Our million prior quarter with depreciation $XXX the as was well the investments locations. strategy

to percentage to $XXX gross or change XXXX to point. I expecting the XX.X%, continue margin change from point. impact margin of non-GAAP We're X margin incremental of in operations. this reflective related our XX%, a $X.XX quarter. transformation Let's This Gross systems of for quarter-to-quarter turn December ongoing in decline plus minus X expect our improve to guidance margin slight plus margins the plus to unfavorable and be percentage costs September or minus of quarter. headwind or included primarily is Gross billion, Operating minus projects mix. customer million. an and operating revenue

operational at communicated and earnings forecasting approximately focused year, we of greater processes we're minus And million share the per business the and $X on implement finally, plus we're to a $X.XX of efficiencies beginning or drive XXX reengineering to of As shares. our share at based on AI scale. systems count

Let me wrap up.

we to driving as year. We to Lam finish Lam the Day Longer operational to encouraged we in see and our manufacturing delivering Investor were year was talking the long-term upgrade that semiconductor the intensity ahead. capitalize to in year. calendar technology capabilities the new look you well positioned multiple in the first forward term, outperformance shared to of XXXX, of at our As spares at by continue we half is our inflections we execute industry. opportunities calendar planned new improvements. and beginning etch investment deposition should February about able extend the and I pleased the we for while that to increase We We're improve the business objectives that exit beginning differentiation prioritize the recovery is activity to

Tim our now and prepared for open questions. call remarks. I to up would that like the Operator, concludes

Operator

comes [Operator UBS. with Instructions] Your from first Tim question Arcuri

Timothy Arcuri

system Doug, to I ask wanted in guidance. service about mix the the

you said up said that think -- you you service thought it's So flatline it's if December, but to and service I But grow X% in I modestly the September this going year-over-year. year. now

guidance? the just clarify service what you you're for in can thinking So

Douglas Bettinger

now to don't But up we forward. grow the was you expect from for little it's give it a a sideways going guide. go whether Tim, strong as forecast. the of clarifying, Yes, not bit It is think up, year, components [indiscernible] decompose I do the quarter. down components in I individual little the be June going for bit. I'm year. the the was individual particularly or that we of we to to

Timothy Arcuri

you're it Okay. during advanced leverage very in can you talk Great, your bit still investors in know talk DRAM Tim, just but of lot But you a there's about of the pretty well where Doug. you talk spent little among excitement, HBM -- the you I then Obviously, And dollars could a to peak. a then it. think I of that's about do generally NAND. there -- just go -- DRAM, the most about next did piece making. investments WFE more being in part and out about packaging Can this DRAM, small that about

just maybe you and investing where give discuss can can think that sense you a to maybe So a of kind DRAM. you chance of where and you're levered some view not us the very of share in DRAM gain you're give to

Timothy Archer

a Sure. future that as We've It's reason capabilities very edge around exciting the structures do etch. We DRAM types towards NAND going said, in side, in said. of enterprise NAND. targeted new But still as cetera. we're is new And we coming, conductor is mean, those progress DRAM of the in especially going nodes Tim. this seen in making, exist the tool I Day for one, are Thanks, on the very that and commentaries to leader introduced. et well SSDs, we've ultra think you small we Lam forward. it's -- -- highlighted the it's conductor global the that really industry the are some

out. that of there's think so us on DRAM have tremendous And opportunity learning as applying future challenges. and for we're And applications, those I expertise I all pointed towards we

strong see The as TSV a HBM. to you DRAM in as of well position well both strong going that the the as etch in other extremely I there, side we we position don't play of our change commented, it, excitement think that And any TSV, And lot related around is with electroplating. forward.

architectural going by multiplied of on HBM in related those bits all wafer. changes and both the advanced that get And DRAM the these sides are that from expansion. and from fewer the we and both fact scaling of you get -- forward per are the packaging So benefit occurring

going And so translates a that into recognizes equipment from more going forward. need And you're more lot wafers processed ultimately, everybody to DRAM . LAM.

Operator

with Next question Krish & from Cowen Company. Sankar comes

Sreekrishnan Sankarnarayanan

My first X Doug. is for

to September? to December to a be gave Kind Is how that the follow-up I the a slight back -- have the of [indiscernible]. And of along way and XX% mentioned a there gross headwind same how that kind on path, points December in half think, you 'XX. calendar many of much China. how there of color curious China would headwind. about calendar be Doug, I more into could compared margin you year some this think quarter, quantify for basis And then in into

Douglas Bettinger

sure. Yes, we said what you hasn't for It is what that the Krish, just quarter. I'll and remind that changed statement last in was China this year, 'XX/'XX, really up. quarter

in because region. it somewhat XX% to seeing be communicating, Krish. going to Again, next soon we're China. year a decent for China, bread than year pretty but a tell it's ready However, I But right? you looks it be was to a a us quantify and in it's second much going like this to things China exactly going it's be for not very last from a lumpy next away. sometimes pretty these hey, is weighted It's year, should bit the I'm too first It's It's solid customers the away. year I'm what year, what going not do bigger think little it somewhat that's as box, spending opposed bit little a half weighted. just not year are year, half away. not can

Sreekrishnan Sankarnarayanan

on December any quarter margin? the Doug, then, color gross And

Douglas Bettinger

bit for the December margin not been customer going a you in what be to incremental while to in little a customer that is mix, suggested signaling half there into the mix number, year. Chris, headwind bit of I'm have because into of of of you XX% said September that because but script. second I going I the and give headwind just will some a little I've a of might guided

Sreekrishnan Sankarnarayanan

like a delivery, on down all Got I upcoming When backside Tim, power [indiscernible] road the it. Got look maybe just tech [indiscernible]. it. And then, the quick inflections, follow-up. at

at I'm way around little Xx just You so, opportunity [indiscernible]. this to more of is there if some how you that is bit transition -- spoke color the about material? the a to quantify if XXX to -- give spoke within architecture size transition. that [indiscernible] the kind a really wondering And that, kind for Lam number of for you curious, can

Timothy Archer

comment inflections. think don't I I we're to brings Well, inflection XX you that of device I we edge on some that with today. Sure. new is these conductor mean, capabilities though, think to itself one, see very was, it developing a important it to for requirements suited requirements. we've serve. prepared etch, quantify each that's think changes. And which technology those my the the architectural And been target additional we're I why new well of layout But puts

in there. depth our a there some bigger incremental opportunity at grow increase jump is and is share our to but So is XD SAM every etch Clearly, to goal our the technology intensity, NAND step-up node. much

at is and new look requirement So the we that. address whatever how best . can we

and You DRAM thing as layers that in kinds how more forward, going happening, etches. excels EV. implementation are at Lam required. of sizes plays high-tech smaller. are Precision [indiscernible] that's where you These getting is pattern anything EUV the also Lam etches whether another effectively transfer feature is the The at. Again, look, it's of look

of things as and at AUV. and like And our plays how deposition look dry we participating about EUV then into course, side, those. on the EUV to talked transition that so resist high-end [indiscernible] we've process DRAM And from in EUV

opportunity so we're at looking as just And node gain. us an for every to technology

Operator

with James. Pajjuri Raymond Srinivas from comes question next Your

Srinivas Pajjuri

been of of a on some sequential that strong have it's well. your mature around guessing you of and a basis. 'XX, that think a very has kind secular declining position. I'm DRAM. that is and look I Then talked DRAM. I been I maybe on at it peaked December is Obviously, in about, revenue, and the now market do a you recovery HBM Tim, as question ongoing driver have

at kind spending, the some back at strongly. wondering kind going of that should, you're about to Just and HBM it if the point, I then would -- it's bottom talk of given come all think

about, why particular, just your want on And we declining? in revenue. to hear been think should it's DRAM thoughts how in I So

Timothy Archer

Yes.

We of about the reset that little of have of think a DRAM And I correct. this would of through conventional we of at early the the picked talked we HPM, kind is or I heavily in off, phase. still came part its fact year call you in ramping is DRAM. spending some second an That some traditional that concentrated even. bit the what last there in that look being growth half think up as HPM becomes by was generally in pretty but a mature into wafers it had as was in year rate And some driver even bigger DRAM.

XXXX the And driver to probably wafers as us think many so that. size And the of I require and the the of well wafer grow that stacking DRAM continuing probably through impact I due look equipment think to bits to DRAM produce number that that beyond we and that on HBM, profile. forward effectively, the we of due for demand these explains [indiscernible] secular to . complexity to means how see DRAMs

Srinivas Pajjuri

Got follow terms additions. And migrations in in WFE? overall that next capacity the of the WFE curious this on mean about XX% I'm of And increasing the up at being then of quarter. seeing, sustainability least tech this Is prelude just usually of or don't business I And something? you're give a us what the want sequentially, you then for going XX% for this to new then And does utilization the trends the does know that CSBG is Okay. it. terms just guidance Tim. forward, some improving? to

on helpful. color So be that any would

Timothy Archer

Sure. spares. And which services. into includes business, upgrades. the business Reliant It's a I nodes. again, that question. It includes mature includes CSBG people good sells And our reminding It guess,

And this so of Reliant we of those and components being somewhat result talked about a spares. differently. strong And each move particularly quarter, as

to our a I've will in in of been memory We upgrades quite see a memory to in a because severe they talked talked markets in we've in and that about we've think much time -- spending of we years. as as about we part as they fabs fact those become the prominent customers' seen pickup WFE look utilization bit look that fabs little the -- the more over begin forward, are starting haven't upgrade that the really that upgraded downturn some last few that to

I And Upgrades little coming to installed forward, and see base itself a spares to up continuing between going do our different grow of you think, balance simply so stronger segments. those get because more continues a bit bigger.

Traditionally, we always said and grow we CSBG capture have then tools more business revenue would to Lam that's ship would year, tools, we year, the and from new expect for basically require every spares those to single those and that services effective simply every and present systems. opportunities

do next be think probably long-term back and fab to So to when start I growth biased upgrades upgrades. much returning that CSBG will year, we more towards the business customers as

Operator

next question from [indiscernible]. comes Your

Unknown Analyst

like to of looking today, you hoping But couple a quarter gross higher about the margins. and quarters guide number. that of was ago, kind focus I to back Doug, the given it's of question 'XX first talked A guess conservative on kind sounds was has normalized. I June it

'XX, calendar to you thinking as kind be normalize for kind you these about of about of should accretion margins? just base higher-margin to kind a about normalized and/or China of what gross be can think you then and some the mix to Malaysia be would thinking you level should drivers? to So we upgrade get related what as we And of Reliant, talk

Douglas Bettinger

in or softening September, to in a of to [indiscernible] that. to It's little mix bit not maybe about obviously. look customer that other things I down mix. year? guided you does previously for customer improved more hey, respect sure about yet, strengthened, ready baseline should year, guide suggesting, as bit Too potentially. soon I'm is me guess, not thinking I'm but I'm little a had you not the to margin to like move mix what moving be customer that that the not and next for relative the CJ, next up June I And to in anchored some all ramp the on, little gross be December mean, numbers, will -- from is alluded a margins. the it what point factories I fashion a gross to bit those Yes, that Yes, you've things you you China and significant will for more output, benefit mix described I quarter to accretion a show as we -- begin but before Asia

So next will a factories, increasingly, see entirely [indiscernible]. incremental customer sure be margin the environment be we supported which Asia to mix, the likely year, from are The those gross be to volume I'm but thinking moving . WFE those stronger, pieces -- should that's about. not beneficial as somewhat

Unknown Analyst

then there, . I could chambers should industry. there to just aspect see installed you X,XXX percentage add upgrades to kind curious, guess remarks, high follow-up, my spoke that of And And helpful. Any demand in help what in the edge kind be Is as guys? as you think your we specifically WFE Very prepared about? to overall you NAND growth great. a there would of ratio

Timothy Archer

remainder NAND earnest, particularly that to beginning upgrades the utilization, next about phase, point that, the And included simply of we our for those to as accrues installed tools we seems out, in think to revenue during year. as amount etch a base itself was upgrade higher represent the quite do they help we and opportunities Lam reduction move fab move but cost to it that and both quarter, haven't the We and bit technology a becomes and of last the when forward Lam's installed through reason this start point base. WFE revenue to seen next a driver we've represents quantified of lot those get WFE [indiscernible] upgrade. I be the powerful relative to achieve cycles. the is upgrade to spend. our customers Lam memory higher for talked Remind size year of the and an continuing deposition improve of rate in We much because the so significantly capture out of of upgrade spending people we

Operator

with Research. Rasgon The next question comes from Stacy Bernstein

Stacy Rasgon

additions double at year-over-year NAND in Or be to that sound upgrades, there? you to NAND It does calendar And are upgrade 'XX by all driven purely need next I like get would could was year seeing [indiscernible]. of that if conceivable primarily imply that business signs wanted doesn't ask any now? would for you Like the capacity is driven? additions what it right growth? like WP capacity

Timothy Archer

say obviously, to I spend. is is primary that is what will still upgrades, spent, to be we're next story. Lam Frankly, it's customers say I year. But would is going Well, as WFE that think beneficiary trying WFE whatever Stacy, to we're not the developing WFE NAND of that move what what guide a

upgrade confident my And would outgrow that WFE and a so if was for tremendous space to And technology in it we NAND their their we comment that's lower advance be the way spend. a customers would year essentially in was primarily which efficient represent upgrades costs.

investment thoughts. we phase be next so the of that And do NAND based will on think our

Stacy Rasgon

outlook worse you it. if same Got that your or the or maybe this to follow mean, outlook like I XX days look has Got it. better say that versus up on bit. at year, that, a I you would like ago? mean just gotten little for stayed current NAND

Douglas Bettinger

little better. much, But Doug. think It probably bit in little a meaningfully a Stacy. certainly see hasn't different, Maybe bit of We're uptick it's This utilization. don't Stacy. changed an I is

Stacy Rasgon

it. got So

noise. of kind a it's So

Douglas Bettinger

of noise. kind Yes, a

Operator

Next JPMorgan. question Sur Harlan comes with from

Harlan Sur

the at looks semi and not logic in stabilizing well? strength least utilization just with specialty to some to utilization fabs Or by line that of maybe are specialty out Did mature include a and to we're but to leading-edge foundry, cyclical include start industry? your base mature in like also in minimum, broaden the DRAM . improvements start the seeing rise. at as and it customer NAND, also continues Given CSD, that

Douglas Bettinger

understand frankly. on. going still you is think I [indiscernible] pretty what's soft, And Harlan,

automotive to memory The I with the else's more making on And everybody statements what analog, a to lot space. in earnings in think out industrial, just inventory calls listen have soft. relatively the there, frankly. utilization it's we're fabs, still still seeing do of there's we're quite

Harlan Sur

packaging stretch revenues tools ASIC night, and last AMD about we hear and number out? HPM talk customers that. that getting Broadcom in to are advanced advanced heard I Last systems front, AI I on supply is year. [indiscernible] packaging on lead Google. dynamics for starting And advanced those times Has keep about upside like then year, on appreciate and capacity moved from HBM their quarter, and $X this mean companies constrained GPU talked team you their your being doing supply billion higher the here orders next tight AI we like [indiscernible],

Timothy Archer

Well, expansion chain it seeing the global we're And us of we our has flexibility to than in manufacturing moved that's last during about it more -- higher, not going talked strong had demand those areas. requantify footprint. and supply obviously, is we're the just but ramp. I yet, giving very it

those respond COVID. the in saw Our around be investments right years few goal better we next expansion did to of in this that of the time was we all expansion than able through to

that will we're having within a customers job business, you keeps say bit the talking getting doing us. But cautious that request about quite capacity. And from think Sure, mean, always hear a about we our position like I a drop which so talking the you're of that, . We your customers always tools. environment time, in nice customers a from generally like actually little short urgent think little and bit tools I business busy. that I a this being little responding constrained. I customers. to our this. parts Other lead where are supply adding lot trouble about of running would you all our

bit of that short followed us I it we're means for a that's a of that think demand again, think industry. always sort up creates I the chaos in a place ramp manageable little digestion spike more than be of of long-term because for setting to by, periods good

Operator

Malik from comes question Atif next Citi. with Your

Atif Malik

equipment big Doug, year-over-year sales if XXXX at I X look among China makers. growth the the

but up quite in All XX%, year, of sales are them down this China [indiscernible] the expecting peers up sales are you U.S. be And China teens you're or up. to [indiscernible] and well. XXXX. total in up is guys XX% were

function active you? to the against So NAND year. working project not NAND spending understand and the that dynamics in being competitive last elements maybe just of I'm Was a trying this China just -- or are there are

Unknown Executive

was I'll went customer 'XX, customer customer Atif, that 'XX. our pretty largest strong the perhaps China. in restricted our in out, came in away regulations That when got remind you NAND

you've comparisons that mix at to 'XX in. that factor to then in And you, speak entirely, China not really got we're you're NAND different that. any year-over-year make making, the about seeing of, sure know you're a the don't thinking helps strength least if 'XX I not to but So is domestic China.

Atif Malik

you tool Yes, those are And or the record cryo is That's the on Tim, makes it. mentioned, year process going your improvements that helpful. of solidify next improvement, all to share then it or after? year market

Timothy Archer

I difficult working it's we our needs implementation. I I we're year, ramping, well, we're cases, we're ahead our to those think customers that the -- to X and this investments with engaging X geographies. really our say these ahead kind looking about of many make talked not challenges. I That's a several sight what at different of production. of on good technology generations things people out out years is in That's something mean That's solving But in that's -- [indiscernible] introduce R&D. Generally, we're years lose because, customers all when take think but this. really get you customers to to labs customers years making of it building their etch close wanted the of production new, where say, Lam not into

the we and kind So that customers -- in up pull rate, tremendous capability. will start sometimes fact the than of when the benefits but the kind layer is really, X.Xx about get that's being ultimately pulled in designed But this are of so may that, this see talked sooner. to that end for I profile where often control about good, earlier you needs for XXX-plus really

Atif Malik

layers, sounds layers it was [indiscernible]. to I Exactly asking like XXX about. but XXX It is

Timothy Archer

decade needs continues the of you truly expand density press -- I as towards satisfying want in layers bit we're to to a films but the across our to what see we to see bit also Yes. get industry only we that our talked release chart in not path NAND with to And X,XXX to and the where because cost terms little over that next you'll where we demand get that's about today, go think etch, deposition trying AI.

Operator

question comes Next Goldman Sachs. Toshiya Hari from with

Toshiya Hari

these I have joined addressed. questions been do late, so apologize I if

to Just And question, my that Doug. And one if technology nearest Tim, clarify on for for or then the that probably second side, be just know tool better have different this. competitor? extent us about. on comfortable, the you may to third-generation the you're How you some than would but you can again, you cryo helpful. that again, or address spoke really really, fundamentally is of tool, the I this your spoke characteristics, CSBG

For saw we minus. given still the view? the plus the -- full or year Or June, you Is full calendar previously for rate in said year, a thinking is I the you year? that think about should higher be flattish, strength growth that

Douglas Bettinger

Maybe first, one the Tim comment Yes. I'll that take and [indiscernible] stuff. let I'll then on

scripted my missed have might statements. You

that an today, in quarter in June that part of word that optimistic customers, here think see I think spares. Tim XXXX we're we some are likely hand strength improvement for is last stuff. to memory spares CSBG, the And Reliant. be year the we've was sit that over continues it modestly year. a as Little And grow to decent we to expect for we occurring we'll in of As the bit talking used I about versus this we start now I'll . saw the on utilization been that spend and about the upgrade trends our while. of with And X.X particular

Timothy Archer

Sure, yes.

that [indiscernible], competitors we conventional X.Xx is in deep on would with from think, amazing pretty Cryo paper I start holes delivering etch rates XX-micron the the talked with At [indiscernible]. biggest difference bottom. XX-nanometer with obviously, about than X.X our what and what I do top results is are Lam which a the we're less the to just what between

deliver of into of We And amazing. I result. to about So allow near go today, what fact semiconductor significantly it's chemistries system that of all new is industry. from it ion this allows that on with those a does other in issue us perfect on whole tool verticality. the and that there's to capabilities configuration in -- hardware results our I deep can't chamber very talked that some achieve near Vantec that but design And in -- surface than very, and some which a allude pretty the energy them, our is the hardware these etching are details is with us based one role enabled the -- tool system. in did The are to available holes any our higher available that combination play think I is

today. say So all I can about . that's

Operator

from comes question Joe next Moore Your Stanley. with Morgan

Joseph Moore

Great about but push direct don't we obviously, of behavior would them in different wanted those any about Are seeing doesn't any things list. -- product And which press rule you are a you, talking of with what from any know that. push China pull or entity been foreign to export things number your things seeing I mean, you wondering, happen anxieties. of like also it out of controls affect would seem talking there's the concerns about with ask I you, just I'm But because customers?

Timothy Archer

and I can't last I of we the there discussions the that couple to mentioned said, are that Joe, in know speculate continue and as think happen on all the we obviously, were those have to be. Yes. time what's we'll discussions U.S. government with we calls part don't so regulatory that. ongoing and you really going just of either exactly agencies

would think payments of we think We've I would with them customers others that that's in those our noticeable point as we with [indiscernible]. long nor ship any easily those things -- our understand customers deal would can other But something Xx in that, any customers, I react perspective it terms treat of behavior be viable as sure these by from new as this beyond customers . like them, to down be it's of to same as responsiveness to the we how at say, we change talked of make to. emerge I service that in about customers. that something we we and some don't able

Operator

Blayne Next Jeffries. from Curtis question with comes

Unknown Analyst

think couple I you the a business. qualified just I'm next actually -- Doug, I year as -- of Question. kind meant. year, got China I you what on I on that know you just and know this, curious, didn't a solid

I called to of about you've of this up of better that's minus, feel know think guess, maybe like flat, June part kind hesitant Do I or down last of outside call time. kind I or it, been of China, the question. it you So the other plus you

some if [indiscernible]. idea mean, should Just can you're you have qualify a I going to you what of bit. little

So bit it a better and China lumpy and/or was [indiscernible] little kind a is of bit actually a you? cleanup trending might it be for

Douglas Bettinger

is to I tell a tiny don't terms anybody but for the me for on weighted, know, not said to going expect us It's XXXX. what want only we [indiscernible], I a that away quantify spending quarter in to going somewhat than wouldn't last any completely is honest to you number a sure. not. I in be would China, too not year because China. it's in little first year yet June The I'm little communicate I'm But was soon you this I'm what give to it's call, bit. But be as to of that. half think solid no maybe stronger -- with anything trying next because I change year you. different to really We tiny a to described bit

Unknown Analyst

a willing spend edge want there, curious don't kind to broad forecast. into strong. the just I'm you're I view I'm it's DRAM curious, leading business. pretty strong, kind of then look a pieces And I on to of kind next NAND mean, for is that you. Got of you growth if in just the terms is year. clear But moving the venture as of strokes know was give forecast, you

Douglas Bettinger

Yes.

it's I be. see I to next to spending greater expect low I is spending years a to expect I would than think but don't this for But of upgrades it shocked has year, magnitude. X it year, year, off right? NAND. too soon has next We're next it what NAND lot year NAND. quite in year, going a be than be to us not if stronger of is number, give you you're this in we know

Operator

Next Wells question comes from Fargo. Joe Quatrochi with

Joseph Quatrochi

try can ex are those just upgrade counts again. share higher etch customers we your to NAND obviously about the now and just intensity higher higher return capacity to that wanted side man peak your revenue for I layer of your given think depth support the levels, restricted, If just prior on to transitions?

Douglas Bettinger

that year The China will I'm year But a an year in Joe, to is will year that. if wallet gets fact large it customer lower we when is not ready NAND to a next you lost know is next of pretty tell hard to spending previous be going share what sure. than this I obviously, the kind be than upgrade stronger to be for added, just our your replace it region, relative peaks. capacity greater. of

Timothy Archer

obviously, Joe, year, spending and specific next And environment laid that very the to it's we've that think mean, upgrade we're business in the rises. Yes. XXXX. I demand view, term, out, I talking Longer is NAND our we've in

it's for and [indiscernible] going technology stacking skewed so depth And tear PLC the frame . I that's about and Pure Carbon technical the time and the forward. at. the process, expansion these for And portfolio you're all technologies, scaling strengths Lam's standpoint also the to new towards talked a of which precision of fill gap Lam's SAM NAND of of business, QLC required is a opportunities. implementation etch addition matter of just components the complexity the looking from and

sell, with the gap to strong people I we fill as the Lam, I well we that look the and substantially when at metallization. business were that fill, if go used portfolio very, management, think had expanded is And quite we've for plus as process a stack and gap the portfolio, had NAND so very debt ALD oxide back we've always backside etch where to of stress in the

demand, and it's growth Lam's of but ahead. well opportunities portfolio served So in in also one [indiscernible] NAND as market

once I NAND bodes itself for business starts So well to recover. the that think us

Joseph Quatrochi

quick That's helpful follow-up. color. And just as a

mean, pretty global just non-China any weak. how us that being just help out. think spending is clearly, I there that parse mature You node does you year. But color talked understand help of could piece kind roughly Can kind break you down? about the just flat I us this of

Douglas Bettinger

still what's to answered on you you China of understand adjusted. own think there's. until and right it's decent And analog, is Yes, that's automotive that mature node, in your question, gets investment the inventories industrial now. built occur I meaningfully [indiscernible] Inventory space on down come Joe. need Outside China, soft. going up pretty won't

on. of So that's kind what's going

of question. answered sort your . own You

Operator

question question Next a follow-up is Krish from Sankar.

Sreekrishnan Sankarnarayanan

follow-up. question I Doug, a quick had It's inventory. on a just

XXXX? inventory Or bringing a do would inventory next a bin, inventory year curious [indiscernible] [indiscernible] of about think spoke year? planning You you think like down. this how in kind most strong of think be year, inventory how to next especially WFE about for to about you're in

Douglas Bettinger

you NAND when business if for fell us last rapidly back our big off business. what to part pretty of Listen, Yes. declined a think was year,

so of the the And still have on sitting balance NAND. we will a lot inventory that sheet support

sheet sitting been is the inventory. balance on is will that's to stronger and be, new that will elsewhere, it consume when So a we while. assuming that year, NAND inventory need to NAND where next a for extent growth procure will certain we'll offset What

but year yet. we'd of business, mix largely where there to get timing as then So you we back quite to like the business, geographic have remainder kind yet, of been work inventory with on to turns of forecast and we're distribution they historically of year I'm down business, not ready depend this of next not bring continuing go the through an the to to will and give we but they're what it do the

how that's thinking about you be should So it, Krish.

Operator

Deutsche from Bank. [indiscernible] with Next question Melissa . is

Unknown Analyst

I I on around I all [indiscernible] ask an the nodes. billion target. XXXX to get $X and your think wanted don't leading specifically revenues update to in heard edge

nodes from move what's think those as So the about case? next should high-volume trajectory manufacturing? still as then be about through pilot like ramping we ramp into year, that that And the lines we is that you of thinking

Timothy Archer

no Thanks, gate I in prepared intended make it about time, all do fell message. and we we what mean around Yes. include the Melissa. always just out and this remarks choices don't

again, at previous net-net, certainly, the and gave are hadn't we those calls, quite targeted we've you, about the $X need what markets which and we all a I through we obviously on given if with market the etch technologies, as as with nicely the things they in data I had with but data is quarter, around, think ALD we wins selected happened the portfolios. kind in is hearing multiple in really the markets sweet in wins power had in at are we fact, gate etch, -- our quarter forward-looking computing really power targeted for And think [indiscernible] in in would that and year for films. area That's occurring investment an different fact, all of our before. talked say Often and forecast really so like what the around, been depth for ALD We tools Lam, next those new spot mean, AI, etch. right additional needed backside kind you're move in high-power In from delivery. we terms we And backside in around would same be wins look of additional of we for in and positioned in those for of I end deposition selected quarter, the node, that the going higher. billion I spacers demand films . We specifically quarter, those and customers. [indiscernible] had wins all in is

demand, portfolio And both so again, but also a and share. we're one combination expanding product which winning in that's that's rising of a

end. there asking could the thank the get leaving we in off, question that it so for you so was at And about but no message right

Douglas Bettinger

go call. our that as thank the it. joining today. Appreciate a think and of want the Awesome, for remainder . We variety us I operator, through to of we you to forward look concludes at I interactions seeing quarter. conferences everybody

Timothy Archer

you. Thank

Operator

attending you presentation. now is today's Thank Conference concluded. for

disconnect. You may now

Lam Research (LRCX) 31 Jul 242024 Q4 Earnings call transcript