Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
Paying user area
Try for free
Lam Research Corp. pages available for free this week:
- Income Statement
- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Geographic Areas
- Capital Asset Pricing Model (CAPM)
- Selected Financial Data since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Current Ratio since 2005
- Analysis of Revenues
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Lam Research Corp. for $24.99.
This is a one-time payment. There is no automatic renewal.
We accept:
Economic Profit
Lam Research Corp., economic profit calculation
US$ in thousands
| 12 months ended: | Jun 29, 2025 | Jun 30, 2024 | Jun 25, 2023 | Jun 26, 2022 | Jun 27, 2021 | Jun 28, 2020 | |
|---|---|---|---|---|---|---|---|
| Net operating profit after taxes (NOPAT)1 | |||||||
| Cost of capital2 | |||||||
| Invested capital3 | |||||||
| Economic profit4 | |||||||
Based on: 10-K (reporting date: 2025-06-29), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-25), 10-K (reporting date: 2022-06-26), 10-K (reporting date: 2021-06-27), 10-K (reporting date: 2020-06-28).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= – × =
- Net Operating Profit After Taxes (NOPAT)
- The NOPAT demonstrates a generally upward trend over the examined periods, increasing from approximately 2.4 billion USD in mid-2020 to over 6.1 billion USD by mid-2025. Notably, there was a peak in 2022 with a value exceeding 5.6 billion USD, followed by a decline through 2024, and then a substantial rebound in 2025 surpassing previous highs.
- Cost of Capital
- The cost of capital exhibits a gradual increase over time, starting at about 18.03% in 2020 and reaching 19.5% by 2025. This steady rise indicates a slightly increasing required return on invested capital, which may reflect changes in market conditions or company-specific risk factors.
- Invested Capital
- Invested capital shows a consistent growth trajectory, rising from nearly 11.8 billion USD in 2020 to approximately 16.4 billion USD in 2025. This steady increase in capital invested suggests a strategy of expansion or asset accumulation over the five-year period.
- Economic Profit
- Economic profit demonstrates significant volatility across the periods. Starting at 275 million USD in 2020, it surged to over 3 billion USD in 2022, then declined sharply in 2023 and 2024, reaching a low of about 390 million USD. The figure recovered strongly in 2025 to nearly 3 billion USD. This pattern indicates fluctuations in the company's ability to generate returns above its cost of capital, with peaks corresponding with higher NOPAT and possibly efficient capital use periods, and troughs suggesting times of diminished economic value creation.
Net Operating Profit after Taxes (NOPAT)
Lam Research Corp., NOPAT calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-06-29), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-25), 10-K (reporting date: 2022-06-26), 10-K (reporting date: 2021-06-27), 10-K (reporting date: 2020-06-28).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in allowance.
3 Addition of increase (decrease) in deferred revenue.
4 Addition of increase (decrease) in product warranty reserves.
5 Addition of increase (decrease) in restructuring liability.
6 Addition of increase (decrease) in equity equivalents to net income.
7 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= × =
8 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= × 21.00% =
9 Addition of after taxes interest expense to net income.
10 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= × 21.00% =
11 Elimination of after taxes investment income.
- Net Income
- The net income demonstrated a generally positive trend over the analyzed period, with some fluctuations. Starting at approximately 2.25 billion USD in 2020, it almost doubled in 2021 to 3.91 billion USD and increased further to about 4.61 billion USD in 2022. A slight decrease occurred in 2023, falling to 4.51 billion USD, followed by a more pronounced decline in 2024 to 3.83 billion USD. However, in 2025, net income surged significantly to approximately 5.36 billion USD, marking the highest point in the time frame.
- Net Operating Profit After Taxes (NOPAT)
- The NOPAT showed a generally upward trajectory until 2022, beginning at about 2.40 billion USD in 2020 and increasing substantially to approximately 5.63 billion USD by 2022. However, there was a notable reduction in the following years; NOPAT dropped to 4.06 billion USD in 2023 and further declined to 3.26 billion USD in 2024. A strong recovery is observed in 2025, with NOPAT rising sharply to around 6.11 billion USD, the highest value recorded in the examined periods.
- General Observations
- Both net income and NOPAT largely followed similar trends, with growth peaking in 2022, followed by declines in 2023 and 2024, prior to significant recoveries in 2025. The reductions in 2023 and 2024 suggest temporary challenges affecting profitability and operational efficiency. The considerable rebound in 2025 indicates successful measures to restore profitability and operational performance. Overall, the company appears to maintain strong profit-generating capabilities with cyclical variability.
Cash Operating Taxes
Lam Research Corp., cash operating taxes calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-06-29), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-25), 10-K (reporting date: 2022-06-26), 10-K (reporting date: 2021-06-27), 10-K (reporting date: 2020-06-28).
- Provision for Income Taxes
- The provision for income taxes exhibits a generally increasing trend from 2020 through 2023, rising from approximately 323 million US dollars in 2020 to nearly 598 million US dollars in 2023. However, in the subsequent year (2024), there is a noticeable decline to about 532 million US dollars, before rising again significantly in 2025 to approximately 600 million US dollars. This pattern suggests some fluctuation in estimated tax liabilities despite an overall upward movement.
- Cash Operating Taxes
- Cash operating taxes show a consistent and marked upward trajectory over the entire period analyzed. Starting at approximately 361 million US dollars in 2020, cash taxes almost double to around 654 million US dollars in 2021. The upward momentum continues sharply into 2022 with cash taxes reaching about 883 million US dollars. Although there is a downward adjustment in 2023 and 2024—declining to roughly 782 million and 718 million US dollars respectively—the value increases again considerably in 2025 to approximately 954 million US dollars. This indicates variability in actual cash outflows for taxes, with a generally increasing trend over the six-year period.
- Comparative Insights
- When comparing provision for income taxes with cash operating taxes, cash taxes have consistently been higher than provisions throughout all years. The gap between these two metrics widens substantially from 2020 to 2022, implying that actual tax payments in cash increasingly exceeded estimated provisions in these years. Although provisions increase steadily, the fluctuations and higher amounts in cash operating taxes may reflect timing differences, changes in tax planning strategies, or variations in tax payments versus accrual estimates.
Invested Capital
Lam Research Corp., invested capital calculation (financing approach)
US$ in thousands
Based on: 10-K (reporting date: 2025-06-29), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-25), 10-K (reporting date: 2022-06-26), 10-K (reporting date: 2021-06-27), 10-K (reporting date: 2020-06-28).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of allowance for doubtful accounts receivable.
4 Addition of deferred revenue.
5 Addition of product warranty reserves.
6 Addition of restructuring liability.
7 Addition of equity equivalents to stockholders’ equity.
8 Removal of accumulated other comprehensive income.
- Total Reported Debt & Leases
- The total debt and leases demonstrate a declining trend over the reported periods. Starting from approximately 5.98 billion in mid-2020, the amount decreases to around 4.76 billion by mid-2025. This suggests a possible strategy of reducing leverage or paying down debt over the years, particularly notable from mid-2024 to mid-2025.
- Stockholders’ Equity
- Stockholders’ equity shows a consistent upward trend across all periods. It grows from about 5.17 billion in 2020 to nearly 9.86 billion in 2025. This significant increase indicates enhanced company value or accumulated earnings, suggesting strengthened financial health and increased net assets over time.
- Invested Capital
- Invested capital rises steadily from approximately 11.79 billion in 2020 to around 16.36 billion in 2025, with a minor dip observed between mid-2023 and mid-2024. This overall upward movement reflects continued investment in operations or assets, supporting growth initiatives or expansion efforts.
Cost of Capital
Lam Research Corp., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt and finance lease obligations3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2025-06-29).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease obligations. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt and finance lease obligations3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2024-06-30).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease obligations. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt and finance lease obligations3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2023-06-25).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease obligations. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt and finance lease obligations3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2022-06-26).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease obligations. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt and finance lease obligations3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2021-06-27).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease obligations. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | ÷ | = | × | = | |||||||||
| Long-term debt and finance lease obligations3 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Operating lease liability4 | ÷ | = | × | × (1 – 21.00%) | = | ||||||||
| Total: | |||||||||||||
Based on: 10-K (reporting date: 2020-06-28).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease obligations. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Lam Research Corp., economic spread ratio calculation, comparison to benchmarks
| Jun 29, 2025 | Jun 30, 2024 | Jun 25, 2023 | Jun 26, 2022 | Jun 27, 2021 | Jun 28, 2020 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Economic profit1 | |||||||
| Invested capital2 | |||||||
| Performance Ratio | |||||||
| Economic spread ratio3 | |||||||
| Benchmarks | |||||||
| Economic Spread Ratio, Competitors4 | |||||||
| Advanced Micro Devices Inc. | |||||||
| Analog Devices Inc. | |||||||
| Applied Materials Inc. | |||||||
| Broadcom Inc. | |||||||
| Intel Corp. | |||||||
| KLA Corp. | |||||||
| Micron Technology Inc. | |||||||
| NVIDIA Corp. | |||||||
| Qualcomm Inc. | |||||||
| Texas Instruments Inc. | |||||||
Based on: 10-K (reporting date: 2025-06-29), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-25), 10-K (reporting date: 2022-06-26), 10-K (reporting date: 2021-06-27), 10-K (reporting date: 2020-06-28).
1 Economic profit. See details »
2 Invested capital. See details »
3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × ÷ =
4 Click competitor name to see calculations.
- Economic Profit
- The economic profit exhibited considerable fluctuations over the analyzed periods. Starting at approximately 275 million US dollars in 2020, there was a significant increase to over 2.2 billion in 2021, followed by a further rise to about 3.1 billion in 2022. However, in 2023, economic profit declined sharply to around 1.19 billion and further dropped to approximately 390 million in 2024. The final data point in 2025 shows a strong recovery back to nearly 2.9 billion.
- Invested Capital
- Invested capital displayed a consistent upward trend throughout the periods under review. Beginning at roughly 11.8 billion US dollars in 2020, it increased steadily each year, reaching approximately 12.3 billion in 2021, 13.5 billion in 2022, 15.0 billion in 2023, with a minor decrease noted in 2024 to about 14.8 billion. This was followed by an increase again in 2025 to around 16.4 billion, indicating ongoing investment and asset growth over time.
- Economic Spread Ratio
- The economic spread ratio demonstrated marked volatility. Initially, in 2020, it was relatively low at 2.33%. It surged significantly to 18.21% in 2021 and further to 22.85% in 2022, reflecting improved profitability relative to invested capital during these years. The ratio declined substantially to 7.94% in 2023 and further to 2.63% in 2024, paralleling the reduction in economic profit. By 2025, the economic spread ratio rebounded to 17.82%, indicating a recovery in economic returns despite the prior volatility.
- Summary
- The data reveals a pattern of strong economic profit growth during 2021 and 2022, supported by an increasing invested capital base and enhanced economic spread ratios, suggesting efficient capital use during these years. The subsequent decline in profitability and economic spread in 2023 and 2024 contrasts with the steady growth in invested capital, potentially signaling challenges in generating returns on investment during this period. The rebound in 2025 highlights a recovery phase with improved economic returns. Overall, the company appears to maintain growth in invested capital while facing cyclical fluctuations in profitability and returns.
Economic Profit Margin
Lam Research Corp., economic profit margin calculation, comparison to benchmarks
| Jun 29, 2025 | Jun 30, 2024 | Jun 25, 2023 | Jun 26, 2022 | Jun 27, 2021 | Jun 28, 2020 | ||
|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||||
| Economic profit1 | |||||||
| Revenue | |||||||
| Add: Increase (decrease) in deferred revenue | |||||||
| Adjusted revenue | |||||||
| Performance Ratio | |||||||
| Economic profit margin2 | |||||||
| Benchmarks | |||||||
| Economic Profit Margin, Competitors3 | |||||||
| Advanced Micro Devices Inc. | |||||||
| Analog Devices Inc. | |||||||
| Applied Materials Inc. | |||||||
| Broadcom Inc. | |||||||
| Intel Corp. | |||||||
| KLA Corp. | |||||||
| Micron Technology Inc. | |||||||
| NVIDIA Corp. | |||||||
| Qualcomm Inc. | |||||||
| Texas Instruments Inc. | |||||||
Based on: 10-K (reporting date: 2025-06-29), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-25), 10-K (reporting date: 2022-06-26), 10-K (reporting date: 2021-06-27), 10-K (reporting date: 2020-06-28).
1 Economic profit. See details »
2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenue
= 100 × ÷ =
3 Click competitor name to see calculations.
- Economic Profit
- The economic profit exhibited significant variability over the observed periods. Starting at 275,176 thousand USD in 2020, it increased markedly to 2,233,946 thousand USD in 2021 and further to 3,087,659 thousand USD in 2022. However, a notable decline occurred in 2023, dropping to 1,190,142 thousand USD, followed by a further decrease to 390,500 thousand USD in 2024. The profit rebounded strongly in 2025, reaching 2,915,006 thousand USD, indicating substantial fluctuations that may be related to operational performance or external market conditions.
- Adjusted Revenue
- Adjusted revenue demonstrated an overall upward trend with intermittent volatility. Beginning at approximately 10,132,858 thousand USD in 2020, revenue rose significantly to 15,207,530 thousand USD in 2021 and continued to grow to 18,306,331 thousand USD in 2022. A decline was observed in 2023 and 2024, with revenues falling to 17,068,323 thousand USD and 14,619,075 thousand USD respectively. In 2025, adjusted revenue recovered robustly to 19,565,054 thousand USD, indicating resilience and an ability to regain sales momentum after temporary contractions.
- Economic Profit Margin
- The economic profit margin displayed considerable fluctuations, mirroring the pattern seen in economic profit. Initially low at 2.72% in 2020, the margin improved dramatically to 14.69% in 2021 and further to 16.87% in 2022, reflecting improved profitability relative to revenue. This was followed by a sharp decline to 6.97% in 2023 and a further drop to 2.67% in 2024, suggesting diminished efficiency or increased costs affecting profitability during these years. The margin then increased substantially to 14.9% in 2025, signaling a strong recovery in profit generation efficiency.
- Summary of Trends
- Across the examined period, financial performance showed a pattern of growth interrupted by notable downturns, particularly in 2023 and 2024. Both economic profit and profit margin exhibited peaks in 2022 followed by weakness in subsequent years, whereas adjusted revenue maintained a more consistent upward trajectory with minor declines. The rebound in economic profit and margin in 2025 suggests a positive turnaround possibly driven by improved operational strategies or market conditions. Overall, the fluctuations highlight the necessity to monitor factors affecting profitability beyond revenue growth.