Analysis of the 2025 Form 10-K and Proxy Statement | Fiscal year ended 29 June 2025
FY2025, ended 29 June 2025. Reporting currency: US dollars (US$). Amounts in US$ millions unless otherwise stated; "bp" means basis points, "n.m." a change that is not meaningful (zero base or change of sign). The multiples use only the closing price of US$97.20 on 27 June 2025, the last trading day of the fiscal year, which ended on Sunday 29 June, and the 1,265,621,000 shares outstanding on 7 August 2025 shown on the 10-K cover.
Lam Research designs, manufactures, sells and services equipment for processing silicon wafers, mainly in deposition, etch and clean. Its customers are memory makers, foundries and integrated device manufacturers producing logic devices. The document breaks revenue into two categories. The first is sales of new systems, recognised "at a point in time, which is generally upon shipment or delivery". The second is the Customer Support Business Group (CSBG): spares, upgrades, services and non-leading-edge equipment from the Reliant® line; services are recognised over time.
The document reports a single reportable segment, "manufacturing and servicing of wafer processing semiconductor manufacturing equipment" (Note 19). The only breakdown of revenue in absolute amounts is between systems and CSBG.
| Category | FY2025 | % FY2025 | FY2024 | FY2023 | Chg. FY25/FY24 | Chg. FY24/FY23 |
|---|---|---|---|---|---|---|
| Systems revenue | 11,491.3 | 62.3% | 8,921.6 | 10,695.9 | +28.8% | −16.6% |
| CSBG and other | 6,944.3 | 37.7% | 5,983.7 | 6,732.6 | +16.1% | −11.1% |
| Total | 18,435.6 | 100.0% | 14,905.4 | 17,428.5 | +23.7% | −14.5% |
The document also gives the percentage split of equipment and upgrade revenue by market served, without amounts:
| Market | FY2025 | FY2024 | FY2023 |
|---|---|---|---|
| Foundry | 45% | 40% | 38% |
| Memory | 42% | 42% | 42% |
| Logic/IDM | 13% | 18% | 20% |
| Total | 100% | 100% | 100% |
The document does not give amounts for deposition, etch and clean.
| Region | FY2025 | % FY2025 | FY2024 | FY2023 | Chg. FY25/FY24 | Chg. FY24/FY23 |
|---|---|---|---|---|---|---|
| China | 6,205.1 | 33.7% | 6,294.0 | 4,462.7 | −1.4% | +41.0% |
| Korea | 4,127.8 | 22.4% | 2,874.0 | 3,551.7 | +43.6% | −19.1% |
| Taiwan | 3,445.2 | 18.7% | 1,671.8 | 3,477.9 | +106.1% | −51.9% |
| Japan | 1,880.9 | 10.2% | 1,460.4 | 1,758.4 | +28.8% | −16.9% |
| United States | 1,376.9 | 7.5% | 1,104.1 | 1,665.1 | +24.7% | −33.7% |
| Southeast Asia | 837.2 | 4.5% | 794.1 | 1,354.5 | +5.4% | −41.4% |
| Europe | 562.6 | 3.1% | 707.0 | 1,158.3 | −20.4% | −39.0% |
| Total | 18,435.6 | 100.0% | 14,905.4 | 17,428.5 | +23.7% | −14.5% |
Differences of ±0.1 in the column totals are due to rounding from thousands to millions; in thousands the totals tie exactly. The FY25/FY24 changes compare 52 weeks with 53 weeks, and the document does not quantify the effect of the extra week.
Employees: "approximately 19,000 regular full-time employees" at 7 August 2025, of whom over 29% work in research and development. The document gives neither the figure at the balance sheet date nor the prior-year figure.
Signing management: the 10-K is signed by Timothy M. Archer (President and CEO), Douglas R. Bettinger (CFO) and Christina C. Correia (Chief Accounting Officer). Ava A. Harter, Chief Legal Officer and Secretary since 8 July 2024, joins the group of executives whose compensation is disclosed. The document does not allow a check of whether the signatories changed from the previous 10-K.
Items that are new or changed relative to the comparative columns:
The document does not compare this year's risk factors with those in the previous 10-K, so the risks introduced for the first time cannot be isolated.
The document lists five differentiating factors: research and development, cycles of learning from the installed base, collaboration with the ecosystem, breadth of the portfolio, and multi-product solutions. Two are backed by facts reported in the document. The first is the qualification cost borne by the customer: "once a semiconductor manufacturer has selected a particular supplier's equipment and qualified it for production, the manufacturer generally maintains that selection for that specific production application and technology node". The second is the installed base, which feeds CSBG revenue: 6,944.3 million in FY2025, or 37.7% of the total.
The financial indicators are consistent with a strong position. Gross margin was 48.7% in FY2025, against 47.3% in FY2024 and 44.6% in FY2023. Year-end ROIC is 64.5%. R&D spending was 2,096.4 million, or 11.4% of revenue.
The document names competitors by market. In dielectric and metals deposition the main one is Applied Materials; in ALD and PECVD also ASM International and Wonik IPS. In etch they are Applied Materials, Hitachi and Tokyo Electron; in wet clean Screen Holding, Semes and Tokyo Electron. The document points to three sources of erosion: competitors "created and financially backed by foreign governments", customers with "affiliated entities that manufacture equipment similar to ours", and competitors not subject to US export controls. The document gives no market shares.
The document gives no average selling prices, price lists or price revisions. The only indirect evidence is gross margin, up 140 basis points in FY2025. The company attributes the increase to "improved factory efficiencies and favorable product mix", that is to costs and mix, not to prices. In FY2024 the 270 basis point increase is attributed to "a more favorable customer mix, reduced spending on material costs, and higher field resource utilization".
The risk factors point the other way: "large customers may be able to negotiate requirements that result in decreased pricing". In FY2025 two customers together account for 32% of revenue (17% + 15%). Pricing power therefore remains undocumented.
FY2025 growth is organic according to the cash flow statement: the "Business acquisitions, net of cash acquired" line is zero in both FY2025 and FY2024. Among the three years in the cash flow statement, the only acquisition is in FY2023, for 120.0 million. Goodwill is unchanged at 1.6 billion at both balance sheet dates, with no impairments over the three years.
Two factors make the +23.7% growth less clean than the headline figure. FY2024 had 53 weeks against 52 in FY2025, and the document does not quantify the effect. In addition, the company states that it exercises discretion over delivery timing: "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". The dollar impact is not disclosed.
| Item | FY2025 | FY2024 | Chg. FY25/FY24 |
|---|---|---|---|
| Revenue | 18,435.6 | 14,905.4 | +23.7% |
| Cost of goods sold | 9,456.5 | 7,852.6 | +20.4% |
| R&D | 2,096.4 | 1,902.4 | +10.2% |
| SG&A | 981.7 | 868.2 | +13.1% |
| Total operating expenses | 3,078.1 | 2,788.9 | +10.4% |
| Operating income | 5,901.0 | 4,263.9 | +38.4% |
Every cost line grew more slowly than revenue. R&D as a share of revenue fell from 12.8% to 11.4%.
The leverage also works in reverse. In FY2024 revenue fell 14.5% and operating income 17.6%, while R&D rose 10.1%. The company says so: "Even during periods of reduced revenues, we must continue to invest in R&D".
| Item | FY2025 | FY2024 | FY2023 | Chg. FY25/FY24 | Chg. FY24/FY23 |
|---|---|---|---|---|---|
| Revenue | 18,435.6 | 14,905.4 | 17,428.5 | +23.7% | −14.5% |
| Cost of goods sold | 9,456.5 | 7,852.6 | 9,651.6 | +20.4% | −18.6% |
| Gross profit | 8,979.1 | 7,052.8 | 7,776.9 | +27.3% | −9.3% |
| Gross margin | 48.7% | 47.3% | 44.6% | +140 bp | +270 bp |
| R&D | 2,096.4 | 1,902.4 | 1,727.2 | +10.2% | +10.1% |
| SG&A | 981.7 | 868.2 | 832.8 | +13.1% | +4.3% |
| Restructuring (operating expenses) | 0.0 | 18.2 | 42.2 | n.m. | −56.9% |
| Operating income | 5,901.0 | 4,263.9 | 5,174.9 | +38.4% | −17.6% |
| Operating margin | 32.0% | 28.6% | 29.7% | +340 bp | −110 bp |
| Interest income | 231.3 | 251.9 | 139.0 | −8.2% | +81.3% |
| Interest expense | (178.2) | (185.2) | (186.5) | −3.8% | −0.7% |
| Other income (expense), net (total) | 57.2 | 96.3 | (65.7) | −40.6% | n.m. |
| Income before income taxes | 5,958.1 | 4,360.2 | 5,109.2 | +36.6% | −14.7% |
| Income taxes | (599.9) | (532.5) | (598.3) | +12.7% | −11.0% |
| Effective tax rate | 10.1% | 12.2% | 11.7% | −210 bp | +50 bp |
| Net income | 5,358.2 | 3,827.8 | 4,510.9 | +40.0% | −15.1% |
| Net margin | 29.1% | 25.7% | 25.9% | +340 bp | −20 bp |
| Diluted EPS (US$) | 4.15 | 2.90 | 3.32 | +43.1% | −12.7% |
| Weighted average diluted shares (millions) | 1,290.1 | 1,319.9 | 1,358.3 | −2.3% | −2.8% |
The Other income (expense), net line includes interest, foreign exchange, gains on deferred compensation plan assets and other items (table A.1).
Among the three years in the statements (FY2023-FY2025), FY2025 has the highest revenue, operating income and diluted EPS. The shareholder letter speaks of "revenues and diluted earnings per share coming in at historic highs": the statements allow this to be checked only over FY2023-FY2025. The non-GAAP reconciliation in the proxy (Appendix B) extends the GAAP operating income series back to FY2021, and over FY2021-FY2025 the FY2025 figure (5,901.0 million) is the highest.
EPS grows faster than net income (+43.1% against +40.0%) because of the reduction in weighted average diluted shares.
| Item | 29/06/2025 | 30/06/2024 |
|---|---|---|
| Cash and cash equivalents | 6,390.7 | 5,847.9 |
| 2025 Senior Notes (3.80%) | 0.0 | 500.0 |
| 2026 Senior Notes (3.75%) | 750.0 | 750.0 |
| 2029 Senior Notes (4.00%) | 1,000.0 | 1,000.0 |
| 2030 Senior Notes (1.90%) | 750.0 | 750.0 |
| 2049 Senior Notes (4.875%) | 750.0 | 750.0 |
| 2050 Senior Notes (2.875%) | 750.0 | 750.0 |
| 2060 Senior Notes (3.125%) | 500.0 | 500.0 |
| Total Senior Notes principal | 4,500.0 | 5,000.0 |
| Unamortised discount and issuance costs, other financing | (30.6) | (32.6) |
| Senior Notes, carrying value | 4,469.4 | 4,967.4 |
| Finance leases | 15.1 | 16.0 |
| Operating lease liabilities | 272.1 | 287.7 |
| Gross debt | 4,756.6 | 5,271.1 |
| Net cash position (cash − gross debt) | +1,634.1 | +576.8 |
| Shareholders' equity | 9,861.6 | 8,539.5 |
The Senior Notes are all fixed-rate. The US$2.0 billion revolving credit facility (maturing January 2030) and the US$1.5 billion commercial paper programme were undrawn at 29 June 2025. The amount due within one year consists of the 2026 Notes, 750.0 million at principal.
Liabilities also include 603.4 million of long-term income taxes payable. The 2017 transition tax has a remaining balance of 229.6 million, expected in FY2026 (Note 17). Uncertain tax position liabilities excluded from commitments are 635.4 million. The document reports no marketable securities on the balance sheet at either date.
| Item | FY2025 | FY2024 | FY2023 |
|---|---|---|---|
| Operating cash flow | 6,173.3 | 4,652.3 | 5,178.9 |
| Capex | (759.2) | (396.7) | (501.6) |
| Free cash flow | 5,414.1 | 4,255.6 | 4,677.4 |
| SBC | 343.4 | 293.1 | 286.6 |
| FCF net of SBC | 5,070.7 | 3,962.5 | 4,390.8 |
| Cash taxes paid | 972.5 | 991.8 | 809.7 |
| Buybacks | 3,422.3 | 2,842.8 | 2,017.0 |
| Dividends paid | 1,149.5 | 1,018.9 | 907.9 |
| Buybacks + dividends as % of FCF | 84.4% | 90.7% | 62.5% |
Owner earnings = net income + D&A − capex. GAAP net income is already stated after SBC, so SBC is not deducted again.
The change in deferred profit added 1,147.8 million to FY2025 operating cash flow. As a percentage it is 18.6% of the total.
On the other side, trade receivables absorbed 858.7 million. Capex almost doubled (+91.4%).
Cash taxes paid (972.5 million) exceed the income statement charge (599.9 million). In the cash flow statement, deferred taxes account for −363.2 million.
Dilution and repurchases, in shares:
Weight of SBC:
Unrecognised cost for RSUs/PRSUs is 521.3 million, to be recognised over approximately 2.2 years.
| Metric | FY2025 | FY2024 | FY2023 |
|---|---|---|---|
| Gross margin | 48.7% | 47.3% | 44.6% |
| Operating margin | 32.0% | 28.6% | 29.7% |
| Net margin | 29.1% | 25.7% | 25.9% |
| EBITDA (operating income + D&A) | 6,287.2 | 4,623.6 | 5,517.3 |
| FCF / net income | 101.0% | 111.2% | 103.7% |
| Capex / revenue | 4.1% | 2.7% | 2.9% |
| SBC / revenue | 1.9% | 2.0% | 1.6% |
| ROE (net income / year-end equity) | 54.3% | 44.8% | 54.9% |
| ROIC (year-end) | 64.5% | 47.0% | not available |
| Gross debt / EBITDA | 0.76x | 1.14x | not available |
| Interest coverage | 33.1x | 23.0x | 27.8x |
| Days sales outstanding (year-end, actual days in the fiscal year) | 66.7 | 62.7 | not available |
| Days inventory (year-end, actual days in the fiscal year) | 165.8 | 199.3 | not available |
ROIC. Method: NOPAT over year-end invested capital, same method for both years.
Invested capital includes 1,808.7 million of goodwill and intangible assets. NOPAT is calculated at the 10.1% effective tax rate, which includes the Malaysian incentive and the statute-of-limitation benefit described in section 6.
Leverage.
Interest coverage.
FCF conversion.
Multiples. Price US$97.20 on 27 June 2025; 1,265,621,000 shares on 7 August 2025 (10-K cover). The two dates are 41 days apart: market capitalisation combines the year-end price with a share count taken after year end.
Export controls on China (risk already materialised). China accounted for 33.7% of revenue in FY2025, 42.2% in FY2024 and 25.6% in FY2023. According to the document, the expansion of export license requirements imposed by the US government "have limited the market for our products, adversely impacted our revenues, and increased our exposure to foreign competition". The document also cites the extension of the foreign direct product rule to transactions involving Huawei and its affiliates. The risk matters because the region's weight moved by more than 16 points in two years. In FY2025 China revenue fell 1.4% while total revenue grew 23.7%.
Customer concentration (potential). Two customers account for 17% and 15% of FY2025 revenue; in FY2024 there was only one, at 17%. In FY2023 there were two, at 22% and 16%. The document warns that "the actions of even one customer may subject us to variability". The same applies to credit risk, which the document says may be concentrated among a few customers. In FY2025 trade receivables rose 34.1%, against revenue growth of 23.7%.
Cyclical demand (already materialised in FY2024). In FY2024 revenue fell 14.5% and net income 15.1%. The document describes the industry as "cyclical in nature" and warns that leading indicators "may not be any more reliable than in prior years". R&D, which rose 10.1% even in the down year, amplified the effect on margins.
Dependence on a favourable tax rate (potential). The Malaysian incentive, valid for 15 years from FY2022, reduced taxes by 584.8 million in FY2025. Per share it is worth US$0.45, or 10.8% of diluted EPS. Gross uncertain tax positions are 720.3 million, and tax years 2005-2025 remain open to examination. The IRS is examining FY2019-FY2021. On the OBBBA, the company writes that it is "currently assessing" the effects on FY2026.
Competition backed by governments and by customers themselves (potential). The document cites competitors "created and financially backed by foreign governments" with "substantially greater financial resources". It also cites competitors not subject to US controls, able to sell to customers Lam cannot sell to. The warning "These competitors may deeply discount or give away products" bears directly on pricing power.
Inventory valuation (potential, a Critical Audit Matter). Inventories are 4,308.0 million, 20% of total assets according to the auditor. Year-end days inventory are 165.8. The document acknowledges that, for some single-source components, the company carries "inventory in excess of current need". A write-down would go through cost of goods sold, and therefore through gross margin.
Supply chain and single suppliers (potential). The document states that some components "may only be obtained from a single supplier". Non-cancellable purchase obligations total 1,036.2 million, of which 721.1 fall in FY2026. For open purchase orders, which are generally cancellable, the document writes "we expect to fulfill approximately $387 million within one year related to these arrangements".
Concentration of manufacturing and R&D facilities (potential). The document states that "our manufacturing and R&D facilities are concentrated in a limited number of locations", exposed among other things to earthquakes and wildfires. Long-lived assets in the United States are 1,716.6 million out of 2,715.7, or 63.2%. Those in Southeast Asia are 451.3 million.
No litigation is considered material: the document states that the company is not "currently a party to any legal proceedings that it believes material" and has not accrued any material amounts.
Control structure. There is a single class of common stock (par value US$0.001), listed on the Nasdaq Global Select Market, with no preferred stock outstanding. Holders above 5% are The Vanguard Group with 10.24% and BlackRock with 9.34%. The percentages are calculated on 1,261,032,300 shares at 5 September 2025, with holdings reported at the dates of the respective Schedule 13G filings (31 March 2025 for Vanguard, 31 December 2023 for BlackRock). Directors and executive officers together hold 3,971,889 shares, less than 1%. The bylaws designate the Delaware Court of Chancery as the exclusive forum.
Board. The proxy nominates 11 candidates. The chair is an independent director, Abhijit Y. Talwalkar, so no lead independent director is designated. CEO Timothy M. Archer has been in office since December 2018. The audit committee is chaired by Eric K. Brandt.
Compensation (Summary Compensation Table):
| Executive | Position | Total FY2025 (US$) | Total FY2024 (US$) |
|---|---|---|---|
| Timothy M. Archer | President and CEO | 28,298,161 | 30,135,041 |
| Douglas R. Bettinger | EVP and CFO | 8,593,735 | 8,781,832 |
| Patrick J. Lord | EVP and COO | 7,142,114 | 7,067,282 |
| Ava A. Harter | SVP, Chief Legal Officer | 10,591,682 | not applicable |
| Seshasayee Varadarajan | SVP, Global Products Group | 7,180,852 | 6,613,321 |
The ratio of CEO pay to median employee pay (US$91,230) is 310 to 1. Ava A. Harter's total includes a US$500,000 sign-on bonus and an additional new-hire equity award. In the calendar 2024 annual bonus, non-GAAP operating margin determines the funding of the bonus pool. The payout is weighted one third each on non-GAAP operating margin, non-GAAP gross margin and an individual performance factor. The PRSUs granted in FY2025 depend on total shareholder return relative to the companies in the Philadelphia Semiconductor Index.
Related parties. The document reports no transactions above US$120,000 with directors, executive officers or their family members. BlackRock, as a holder above 5%, may be deemed a related party. The company invests in BlackRock money market funds and received approximately 26.7 million of interest and dividends from them in FY2025.
Auditor. Ernst & Young LLP, which states: "We have served as the Company's auditor since 1981". The opinion on the financial statements and on internal control is unqualified, issued on 11 August 2025. FY2025 fees: 8.19 million, of which 7.95 for audit and 0.24 for tax services.
Accounting policies and changes during the year. ASU 2023-07 on segment reporting was adopted in FY2025, with no effect on reported balances. ASU 2023-09 on income taxes will be adopted in FY2026, and ASU 2024-03 on expense disaggregation in FY2028. All per-share data are restated for the 10-for-1 stock split of 2 October 2024. Some FY2024 balance sheet items have been reclassified, with no amount disclosed in the document. On the cover, the box indicating the correction of an error in previously issued financial statements is not checked.
Critical Audit Matter. The auditor identifies only one: the valuation of excess and obsolete inventory. It considers this subjective because management's estimate weighs qualitative factors "affected by market and economic conditions outside the Company's control".
Accounting choices that move earnings:
GAAP and non-GAAP. The proxy (Appendix B) reconciles operating income. For FY2025 it excludes only two items: amortisation of intangibles from acquisitions (13.6 million) and the increase in the deferred compensation liability (42.6 million). Non-GAAP operating income is 5,957.2 million, with a margin of 32.3%. The GAAP figure is 5,901.0 million, with a margin of 32.0%.
For FY2024 the exclusions also included restructuring (61.6 million), transformational costs (101.7 million) and impairment (8.7 million). The MD&A mentions "increased transformational charges" in FY2025, but the FY2025 reconciliation does not exclude them and the document does not give the amount.
Taxes. The effective tax rate is 10.1% (599.9 / 5,958.1) against a statutory federal rate of 21%. The main FY2025 reconciling items:
| Item (Note 7) | US$ millions |
|---|---|
| Tax at the 21% federal statutory rate | 1,251.2 |
| Foreign income taxed at different rates | (451.2) |
| Settlements and reductions in uncertain tax positions | (266.8) |
| Tax credits | (116.7) |
| Increases in uncertain tax positions | 138.0 |
| State valuation allowance, net of federal tax benefit | 42.8 |
| Other items (state, SBC, permanent) | 2.6 |
| Actual income taxes | 599.9 |
The document attributes the lower rate to the "recognition of previously unrecognized tax benefits from lapses of statutes of limitation" and to the different mix of income across jurisdictions. The document does not describe the benefit as either recurring or non-recurring.
Rising deferred revenue. Deferred revenue is 2,681.1 million against 1,551.6, due to "an increase in advance deposits from newer customers". Of this, 2,150.3 million (80.2%) is expected to be recognised as revenue within twelve months (Note 4).
Higher investment in property and equipment. Capex rose to 759.2 million (+91.4%). Gross buildings and improvements went from 1,605.8 to 1,914.6 million. Long-lived assets in Southeast Asia rose from 390.5 to 451.3 million. The document does not state what the investment is for or how much capacity it adds.
Technology inflections identified by the company. According to the MD&A, the company believes that semiconductor demand and technology inflections, including "3D device scaling, multiple patterning, process flow, and advanced packaging chip integration", "will drive sustainable growth". The business description cites solutions for 3D stacking of HBM memory and for fan-out panel-level packaging. The document does not quantify the related revenue.
Mix shift towards foundry and towards Taiwan and Korea. The foundry share of equipment revenue rose from 38% in FY2023 to 45% in FY2025. Taiwan went from 1,671.8 to 3,445.2 million (+106.1%). China's share of revenue fell from 42.2% to 33.7%.
Remaining buyback capacity. 7,517.2 million remains available under the authorisation, which has no expiry date. The US$500 million ASR, with an initial delivery of approximately 5.2 million shares, will settle by 8 September 2025. That date is after the 10-K was signed, and the outcome is not reported in the document.
The document does not report margin, revenue or capex targets stated in the previous year's 10-K: a comparison is possible only for commitments referred to in the notes of this document and for the incentive targets in the proxy.
| Item | Stated | Delivered | Variance |
|---|---|---|---|
| Repayment of 2025 Senior Notes | 500.0 million due 15/03/2025 | "settled upon maturity using available cash on hand" | None |
| Restructuring plan launched in FY2023 | "substantially complete as of June 30, 2024"; remaining liability 1.1 million | Liability "substantially satisfied" in the first quarter of FY2025; no charges in FY2025 | None; cumulative cost 181.9 million |
| Buyback programme (May 2024) | additional 10.0 billion; 10,824.7 million available at 30/06/2024 | 7,517.2 million available at 29/06/2025 | 3,307.5 million used; no annual target stated to compare against |
| Deferred revenue at 30/06/2024 | 1,551.6 million to be recognised | 988.8 million recognised in FY2025 | 64% recognised; the document does not state the share expected at the start of the year |
| Revolving credit facility | 1.5 billion, maturing June 2026 | 2.0 billion, maturing January 2030 | Increased and extended |
| 2017 transition tax | Payment over 8 years from FY2019 | Remaining 229.6 million expected in FY2026 | In line with the schedule; annual amounts paid not available |
| Non-GAAP operating margin, calendar 2024 AIP | Target 30.0% | 30.6% | +60 bp (calendar year, not fiscal year) |
| Non-GAAP gross margin, calendar 2024 AIP | Target 47.7% | 48.2% | +50 bp (calendar year, not fiscal year) |
Buyback capacity used = 10,824.7 − 7,517.2 = 3,307.5.
At the price of US$97.20 on 27 June 2025 the company trades at 22.96 times FY2025 net income. The price-to-FCF multiple is 22.72x, equal to a 4.40% yield. FY2025 is the year with the highest revenue and operating income among those in the statements. As a sensitivity on the document's historical data, the same market capitalisation equals 32.14 times FY2024 net income (123,018.4 / 3,827.8). A 4.40% FCF yield on the peak year of the three therefore requires that earnings do not fall back to FY2024 levels.
The thesis holds under three conditions. Gross margin must stay at least at the FY2024 level (47.3%) even in a downturn. Growth in foundry, Taiwan and Korea must offset the limits on sales to China. The tax rate must not rise materially above the 14.5% calculated excluding uncertain-position settlements. The 3.72% shareholder yield assumes that buybacks and dividends remain funded from FCF without new debt. In FY2025 the payout ratio was 84.4%.
Metrics to monitor in the coming quarters:
Report based on the Lam Research Corporation 2025 Annual Report (Form 10-K for the fiscal year ended 29 June 2025, signed on 11 August 2025, and Proxy Statement distributed from 24 September 2025). Closing price of US$97.20 on 27 June 2025 provided in the request; shares outstanding at 7 August 2025 taken from the 10-K cover. This report is for analysis purposes only and does not constitute investment advice.
The full data table behind this report — every line item with its source in the filing and the arithmetic checks — is published separately: Lam Research FY2025 data table.