Lam Research Corp (LRCX)

Cash ratio

		Jun 30, 2025	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021
Cash and cash equivalents	US$ in thousands	6,390,660	5,847,860	5,337,060	3,522,000	4,418,260
Short-term investments	US$ in thousands	—	—	37,641	135,731	1,310,870
Total current liabilities	US$ in thousands	6,568,420	4,338,440	4,184,920	4,564,760	3,527,870
Cash ratio		0.97	1.35	1.28	0.80	1.62

June 30, 2025 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($6,390,660K + $—K) ÷ $6,568,420K
= 0.97

The cash ratio of Lam Research Corp has demonstrated notable fluctuations over the analyzed period from June 30, 2021, to June 30, 2025. As of June 30, 2021, the cash ratio stood at 1.62, indicating a strong liquidity position where the company's available cash and cash equivalents significantly exceeded its current liabilities. This elevated level suggests that the company was well-positioned to meet its short-term obligations solely through its most liquid assets.

By June 30, 2022, the cash ratio decreased substantially to 0.80, reflecting a decline in the company's liquidity cushion relative to its current liabilities. This reduction may indicate increased utilization of cash for operational needs, investments, or other strategic activities, or a relative decline in cash holdings while current liabilities remained stable or increased.

In the subsequent year, as of June 30, 2023, the cash ratio improved modestly to 1.28, signifying a return to a more comfortable liquidity level, approaching the earlier high seen in 2021. This suggests a partial recovery of the company's liquidity position, potentially driven by increased cash reserves, improved cash flow management, or a reduction in short-term liabilities.

The trend continued into June 30, 2024, with the cash ratio increasing slightly further to 1.35, which indicates a continued strengthening of cash and cash equivalents relative to current liabilities. Such an uptick might reflect ongoing efforts to maintain higher liquidity or successful cash accumulation strategies.

However, by June 30, 2025, the cash ratio decreased to 0.97, falling just below the 1.0 threshold, which typically signifies that the company's cash and cash equivalents are just sufficient to cover short-term liabilities. Although still relatively healthy, this decline indicates a slight tightening of liquidity compared to the previous year.

Overall, the observed trend in Lam Research Corp’s cash ratio over this period illustrates initial strength in liquidity in mid-2021, followed by a decline in 2022, partial recovery in 2023 and 2024, and a slight decrease again in 2025. These fluctuations may reflect changing strategic priorities, cash flow activities, or variations in short-term liabilities, all within a context of overall ongoing liquidity management.