Lam Research Corporation
LRCX · Nasdaq
Dec 2026
Next quarter
Expected to report Jan 27, 2027 — estimated from last year’s reporting date.
Consensus is $2.34 EPS for Dec 2026 across 10 estimates, ranging $2.30 to $2.40.
LRCX Sep 2026
- 1.38%
- -11.76%
- $2.17
- $2.20
- —
- $8.22B
Reported results
- $8.22B
- 52.30%
- $3.28B
- 39.95%
- $2.75B
- $2.19
Highlights
- Record quarter: Revenue reached $8.22 billion, up 22% sequentially and 54% year over year; management cited strong foundry and memory equipment demand.
- EPS beat: Non-GAAP diluted EPS was $2.20 versus $2.17 consensus, a 1.38% beat; GAAP diluted EPS was $2.19.
- Systems drove growth: Systems revenue rose 35% sequentially to $5.73 billion, while customer support-related revenue was nearly flat at $2.49 billion.
- Margins expanded: GAAP gross margin increased to 52.3% from 51.7% in the prior quarter and 50.4% a year ago; operating margin rose to 40.0% from 37.4% and 34.4%, respectively.
- December outlook: Lam guided to revenue of $8.60 billion, plus or minus $400 million, and GAAP diluted EPS of $2.33, plus or minus $0.15.
- Cash generation: Operating cash flow was $3.50 billion; cash, cash equivalents and restricted cash ended the quarter at $7.45 billion, up from $5.60 billion at June quarter-end.
- Capital returns: Lam repurchased $1.02 billion of shares, including a new $1.00 billion accelerated repurchase agreement, and paid $325.4 million in dividends.
- Regional mix: China accounted for 35% of revenue, Korea 20% and Taiwan 18%; foundry and memory each represented 46% of leading- and non-leading-edge equipment and upgrade revenue.
Analysis
Lam’s September 2026 quarter was a sharp step-up in demand and earnings, with record revenue of $8.22 billion, up 22% from June and 54% from a year earlier. Non-GAAP diluted EPS of $2.20 topped the $2.17 consensus by 1.38%; GAAP EPS was $2.19. Compared with the prior quarter, GAAP operating income rose to $3.28 billion from $2.51 billion and net income to $2.75 billion from $2.28 billion. Year over year, revenue increased from $5.32 billion and diluted EPS from $1.24.
Systems sales were the main growth engine: they rose 35% sequentially to $5.73 billion on higher foundry and memory spending, while customer support-related revenue was essentially unchanged at $2.49 billion. Favorable customer and product mix helped lift gross margin to 52.3% and operating margin to 40.0%. Lam’s December-quarter guidance points to further growth, with revenue of $8.60 billion, plus or minus $400 million, and GAAP EPS of $2.33, plus or minus $0.15. Strong operating cash flow of $3.50 billion supported a higher cash balance alongside substantial repurchases and dividends.
Systems demand
- Systems sales: Revenue from systems reached $5.73 billion, up 35% sequentially from $4.25 billion and 62% year over year from $3.55 billion. Lam attributed the sequential increase primarily to stronger foundry and memory equipment spending.
- Support revenue: Customer support-related revenue and other was $2.49 billion, slightly above $2.47 billion in June and 40% higher than $1.78 billion a year ago. The annual increase reflected customer investment in non-leading-edge equipment and higher spares revenue.
- Market mix: Foundry was 46% of equipment and upgrade revenue, up from 44% in June; memory held at 46% and logic/IDM was 8%. Lam said the sequential foundry increase mainly reflected the timing of mature-node investment in China.
Margin expansion
- Gross margin: GAAP gross margin was 52.3%, up 60 basis points sequentially and 190 basis points year over year. Lam cited favorable customer and product mix sequentially, and favorable mix plus higher-volume efficiencies versus a year ago.
- Operating leverage: GAAP operating margin reached 40.0%, compared with 37.4% in June and 34.4% a year earlier. Operating expenses increased to $1.02 billion from $965 million sequentially, primarily on higher incentive compensation and incremental headcount, but remained lower as a share of revenue.
- Tax effect: The GAAP effective tax rate rose to 16.9% from 10.9% in June, partly reflecting a U.S. tax-law change and changes in income mix; the September non-GAAP reconciliation also excludes the tax-law impact.
December outlook
- Revenue and margins: For the quarter ending December 27, Lam guided to revenue of $8.60 billion, plus or minus $400 million, with GAAP gross margin of 52.5% and operating margin of 40.5%, each plus or minus 1 percentage point.
- EPS: GAAP diluted EPS guidance is $2.33, plus or minus $0.15, on an estimated diluted share count of 1.253 billion.
- Demand context: In its filing, Lam said AI-related investment was driving higher wafer-fabrication spending across memory and non-memory markets, while also identifying trade controls, tariffs, customer timing and supply constraints as risks to the outlook.
Cash and returns
- Operating cash flow: Cash from operations was $3.50 billion, versus $1.46 billion in the prior quarter and $1.78 billion a year earlier. The year-over-year increase primarily reflected higher net income and changes in operating assets and liabilities.
- Liquidity and investment: Cash, cash equivalents and restricted cash ended September at $7.45 billion, up from $5.60 billion at June quarter-end. Capital expenditures and intangible assets were $257.7 million.
- Shareholder returns: Cash financing outflows included $1.02 billion of treasury-stock purchases and $325.4 million of dividends paid. The September $1.00 billion accelerated repurchase agreement initially delivered about 2.3 million shares and is expected to settle in the December quarter.
Geography and backlog
- Regional concentration: China contributed 35% of revenue, followed by Korea at 20%, Taiwan at 18%, Japan at 9%, the United States at 8%, Southeast Asia at 6% and Europe at 4%. China’s share rose from 26% in June, while Taiwan’s declined from 27%.
- Deferred revenue: The balance increased to $2.66 billion from $2.43 billion at June quarter-end, primarily due to higher sales volume, partly offset by lower customer down payments. Lam recognized $901.2 million, or 37%, of the June deferred-revenue balance during the quarter.
- Japan shipments: Deferred revenue excludes shipments to Japanese customers until acceptance; estimated future revenue from those shipments was $468.3 million at quarter-end, down from $490.2 million in June.
