Lam Research is held in the US Growth Portfolio. The company reported results for the September quarter, its fiscal first quarter, after the close on Wednesday 21 October. 

Revenue rose 54% year on year and 22% on the June quarter to $8.22 billion, ahead of the roughly $8.14 billion consensus and above the $8.10 billion midpoint of company guidance. Non-GAAP diluted EPS of $2.20 beat the $2.18 estimate and the $2.15 guidance midpoint, and GAAP EPS came in at $2.19 against $1.24 a year earlier. Non-GAAP gross margin reached 52.4% and operating margin 40.2%, both above guidance of 52.0% and 39.5%. 

Systems revenue climbed to $5.73 billion from $4.25 billion in June. Foundry rose to 46% of systems revenue from 44%, level with memory at 46%; within memory, NAND rose to 26% and DRAM eased to 20%. The customer support business group generated $2.49 billion, up 40% on a year ago and its fourth consecutive record. 

China rose to 35% of revenue from 26% in the June quarter, with Korea at 20% and Taiwan at 18%, down from 27%. Chief financial officer Doug Bettinger said he expects China’s share in December to be “meaningfully down, driven by the domestic customers in China”. 

December quarter guidance calls for revenue of $8.60 billion plus or minus $400 million against an $8.53 billion consensus, and EPS of $2.33 plus or minus $0.15 against $2.31 to $2.32. Gross margin guidance is 52.5% and operating margin 40.5%. Management put 2026 wafer fab equipment spending in the mid-$150 billion range, up from the low-$150 billion range in July, and gave a preliminary 2027 figure above $200 billion, led by DRAM, then foundry and logic, then NAND. Chief executive Tim Archer said, “Our strategic investments in technology inflections and manufacturing capacity are paying off.” 

Lam bought back about $1.02 billion of stock, paid $325 million in dividends and lifted the quarterly dividend to $0.33 per share from $0.26. Operating cash flow came to $3.50 billion and cash ended the quarter at $7.45 billion. 

Shares closed down 1.0% at $260.81 on Wednesday. Indicative after-hours quotes had them about 7% lower near $242.