The ratings reflect Lam Research Corp.'s narrow business focus and limited profitability base within the highly volatile semiconductor capital equipment market, as well as the company's leveraged financial profile. These factors are offset, in part, by Lam's leadership market position in its niche segment (etch tools), combined with adequate financial flexibility deriving from its liquid financial profile. Lam Research has a leading share of a niche segment of the semiconductor capital equipment market. The company's tools deposit, etch, and polish microscopically thin layers on the surface of silicon wafers. Competitors include the diversified Applied Materials Inc. and Tokyo Electron Limited. Etch tools account for approximately 12% of the $21 billion semiconductor capital equipment market, and Lam has a one-third share
