Lam exits CMP tool market, posts strong Q2 results

All of the costs associated with this decision are recorded in the June 2004 quarter, representing a total expense of approximately $3 million. Total company R&D expenditures are planned to continue at recent levels.

"Based on recent evaluations, we have concluded that this product does not demonstrate sufficient advantages to garner the market share necessary for adequate returns on further investment," said James W. Bagley, Lam's chairman and chief executive, in a statement. "We will continue to support the company's installed base of Teres CMP systems but will not actively market new systems."

Lam, which will focus on the etch market, had little or no share in the CMP arena. Applied, Ebara, and Novellus dominate the business. Recently, Applied Materials Inc. rolled out a new CMP tool (see July 12 story).

Lam also reported revenue of $329.6 million for the quarter, and net income was $52.7 million, or $0.38 per diluted share, compared to revenue of $231.1 million and net income of $19.2 million, or $0.13 per diluted share, for the March 2004 quarter.