I have 42 tiles of LiDAR .XYZI point data containing approximately 800,000 points each and I need to create 1 foot interval contours out of the data. I have access to ArcMap 10.3 and the 3D Analyst and Spatial Analyst toolbar's. The final goal of the project would be to display the 1' contours associated with flow lines.
Because you have 42 tiles of 800,000 point you have more data than a TIN can hold-you will need to build and populate a Terrain. Using the tools available in the 3D Analyst toolbox-construct an ESRI Terrain dataset , populate the Terrain with your point data, then use the contour tool to construct 1 ft contours. Here is a link to working with Terrains in 10.3: http://desktop.arcgis.com/en/arcmap/10.3/manage-data/terrains/building-a-terrain-dataset-using-the-terrain-wizard.htm