Analysis of Liquidity Ratios
Liquidity ratios measure the company ability to meet its short-term obligations.
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- 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
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Liquidity Ratios (Summary)
Lam Research Corp., liquidity ratios
| Jun 29, 2025 | Jun 30, 2024 | Jun 25, 2023 | Jun 26, 2022 | Jun 27, 2021 | Jun 28, 2020 | ||
|---|---|---|---|---|---|---|---|
| Current ratio | |||||||
| Quick ratio | |||||||
| Cash ratio |
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).
- Current Ratio
- The current ratio shows a general declining trend over the observed periods. It starts at a high of 3.43 in June 2020 and decreases to 2.21 by June 2025. Despite some fluctuations, including a slight increase from 2.69 in June 2022 to 3.16 in June 2023, the overall pattern indicates a gradual reduction in the company's ability to cover short-term liabilities with current assets.
- Quick Ratio
- The quick ratio follows a similar downward trajectory. Beginning at 2.22 in June 2020, it decreases consistently to reach 1.49 in June 2025. This steady decline suggests a diminishing capacity to meet short-term obligations with the most liquid assets after excluding inventory, reflecting a potential tightening of liquidity.
- Cash Ratio
- The cash ratio exhibits more volatility compared to the other liquidity measures. It starts at 1.55 in June 2020, drops sharply to 0.77 in June 2022, then recovers to 1.35 by June 2024 before declining again to 0.97 in June 2025. Although the ratio remains below the initial level, the fluctuations indicate variability in cash and cash-equivalents available relative to current liabilities, which may reflect changes in operational cash flows or cash management strategies.
Current Ratio
Lam Research Corp., current 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) | |||||||
| Current assets | |||||||
| Current liabilities | |||||||
| Liquidity Ratio | |||||||
| Current ratio1 | |||||||
| Benchmarks | |||||||
| Current Ratio, Competitors2 | |||||||
| 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. | |||||||
| Current Ratio, Sector | |||||||
| Semiconductors & Semiconductor Equipment | |||||||
| Current Ratio, Industry | |||||||
| Information Technology | |||||||
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 2025 Calculation
Current ratio = Current assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Current Assets
- Current assets exhibit a generally upward trend over the observed periods, increasing from approximately 10.85 billion US dollars in June 2020 to around 14.52 billion US dollars in June 2025. Despite a slight decline between June 2023 and June 2024, where current assets decreased from about 13.23 billion to 12.88 billion, the overall trajectory remains positive, indicating growth in the company's short-term asset base.
- Current Liabilities
- Current liabilities have shown a significant increase over the six-year period. Starting at approximately 3.16 billion US dollars in June 2020, they rise steadily to about 6.57 billion US dollars by June 2025. A notable spike is observed in the final year, where current liabilities increase markedly from roughly 4.34 billion in June 2024 to 6.57 billion in June 2025. This could suggest increased short-term obligations or possible changes in working capital management.
- Current Ratio
- The current ratio has generally declined from 3.43 in June 2020 to 2.21 by June 2025, suggesting a weakening in short-term liquidity relative to liabilities despite growth in current assets. The lowest ratio is seen in the latest period, indicating a reduction in the cushion available to cover current liabilities. Periodic fluctuations are observed, with a downturn in 2022 to 2.69 from previous levels above 3, followed by a temporary recovery to 3.16 in 2023 before continuing the decreasing trend.
- Summary
- The data indicates the company has expanded its current assets consistently over the reviewed years while current liabilities have increased at a faster rate, particularly in the most recent year. This dynamic has contributed to a decline in the current ratio, highlighting a potential erosion of the company’s short-term liquidity position. Stakeholders may need to monitor these trends for implications on financial flexibility and working capital management.
Quick Ratio
Lam Research Corp., quick 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) | |||||||
| Cash and cash equivalents | |||||||
| Accounts receivable, less allowance | |||||||
| Total quick assets | |||||||
| Current liabilities | |||||||
| Liquidity Ratio | |||||||
| Quick ratio1 | |||||||
| Benchmarks | |||||||
| Quick Ratio, Competitors2 | |||||||
| 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. | |||||||
| Quick Ratio, Sector | |||||||
| Semiconductors & Semiconductor Equipment | |||||||
| Quick Ratio, Industry | |||||||
| Information Technology | |||||||
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 2025 Calculation
Quick ratio = Total quick assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Quick Assets
- The total quick assets demonstrate a consistent upward trend over the examined periods. Starting at approximately 7.01 billion US dollars in June 2020, the figure increased steadily each year, culminating in a value close to 9.77 billion US dollars by June 2025. This growth suggests a strengthening of the company's liquid asset base over time, potentially enhancing its short-term financial flexibility.
- Current Liabilities
- Current liabilities exhibit an overall increasing pattern, with some fluctuations. From June 2020 to June 2022, liabilities rose significantly from about 3.16 billion to approximately 4.56 billion US dollars. A slight decrease occurred in June 2023, followed by a moderate increase in June 2024. However, a notable surge is observed in June 2025, reaching approximately 6.57 billion US dollars, indicating a substantial rise in short-term obligations during the most recent period.
- Quick Ratio
- The quick ratio shows variability across the years. It begins at 2.22 in June 2020, reflecting a strong liquidity position. This ratio declines progressively to 1.72 by June 2022, indicating a decrease in immediate liquidity relative to current liabilities. A partial recovery is visible in June 2023 and 2024, with ratios near 1.95 and 1.93 respectively. However, by June 2025, the ratio drops to 1.49, the lowest in the period analyzed, suggesting a weakening liquidity position in the most recent year, potentially due to the sharp increase in current liabilities.
Cash Ratio
Lam Research Corp., cash 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) | |||||||
| Cash and cash equivalents | |||||||
| Total cash assets | |||||||
| Current liabilities | |||||||
| Liquidity Ratio | |||||||
| Cash ratio1 | |||||||
| Benchmarks | |||||||
| Cash Ratio, Competitors2 | |||||||
| 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. | |||||||
| Cash Ratio, Sector | |||||||
| Semiconductors & Semiconductor Equipment | |||||||
| Cash Ratio, Industry | |||||||
| Information Technology | |||||||
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 2025 Calculation
Cash ratio = Total cash assets ÷ Current liabilities
= ÷ =
2 Click competitor name to see calculations.
- Total Cash Assets
- The total cash assets showed a fluctuating trend over the examined periods. Starting from approximately 4.92 billion USD in mid-2020, there was a decline to about 3.52 billion USD by mid-2022. However, thereafter, the cash assets demonstrated a recovery, rising significantly to around 6.39 billion USD by mid-2025. This pattern indicates a period of cash reduction followed by strong replenishment in recent years.
- Current Liabilities
- Current liabilities depicted an overall upward trend throughout the periods. From approximately 3.16 billion USD in mid-2020, the liabilities increased steadily to about 4.57 billion USD by mid-2022. Subsequently, liabilities continued to grow, reaching roughly 6.57 billion USD by mid-2025, which is more than double the initial value. This steady rise suggests an increasing short-term obligation level for the company.
- Cash Ratio
- The cash ratio, reflecting liquidity by comparing cash assets to current liabilities, experienced notable fluctuations. Initially, the ratio was high at 1.55 in mid-2020, indicating strong liquidity. It then decreased to a low of 0.77 by mid-2022, signifying that available cash was less than current liabilities during this period. Following this, the ratio improved again to 1.35 by mid-2024, before falling to 0.97 in mid-2025. Although there is a recovery from the low, the latest ratio under 1 suggests that cash alone may not cover all short-term liabilities at the most recent period.
- Overall Insights
- The company demonstrated a period of declining cash assets and worsening liquidity position up to mid-2022, followed by recovery in cash holdings. Despite this recovery, current liabilities have consistently increased, which pressures liquidity ratios. The declining cash ratio in the latest period highlights potential challenges in meeting short-term obligations solely with cash, emphasizing the need for monitoring working capital management and possibly exploring other liquid assets or financing strategies.