Lam Research (LRCX)
Market Price (3/5/2026): $224.0 | Market Cap: $281.1 BilSector: Information Technology | Industry: Semiconductor Materials & Equipment
Lam Research (LRCX)
Market Price (3/5/2026): $224.0Market Cap: $281.1 BilSector: Information TechnologyIndustry: Semiconductor Materials & Equipment
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
| Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 27% | Stock price has recently run up significantly6M Rtn6 month market price return is 129%, 12M Rtn12 month market price return is 195% |
| Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 34% | Valuation getting more expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is 57% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 35%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 30%, CFO LTM is 7.1 Bil, FCF LTM is 6.2 Bil | Key risksLRCX key risks include [1] extreme geopolitical vulnerability due to its heavy revenue concentration in Asia (87.9%) and specifically China (42.2%), Show more. |
| Megatrend and thematic driversMegatrends include Artificial Intelligence, and 5G & Advanced Connectivity. Themes include AI Chips, Data Centers & Infrastructure, Show more. |
| Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 27% |
| Attractive operating marginsOp Mgn LTMOperating Margin = Operating Income / Revenue Reflects profitability before taxes and before impact of capital structure (interest payments). is 34% |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 35%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 30%, CFO LTM is 7.1 Bil, FCF LTM is 6.2 Bil |
| Megatrend and thematic driversMegatrends include Artificial Intelligence, and 5G & Advanced Connectivity. Themes include AI Chips, Data Centers & Infrastructure, Show more. |
| Stock price has recently run up significantly6M Rtn6 month market price return is 129%, 12M Rtn12 month market price return is 195% |
| Valuation getting more expensiveP/S 6M Chg %Price/Sales change over 6 months. Declining P/S indicates valuation has become less expensive. is 57% |
| Key risksLRCX key risks include [1] extreme geopolitical vulnerability due to its heavy revenue concentration in Asia (87.9%) and specifically China (42.2%), Show more. |
Qualitative Assessment
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1. Lam Research delivered strong Q4 CY2025 financial results and issued robust guidance for Q1 CY2026.
The company reported Q4 CY2025 revenue of $5.34 billion, surpassing analyst estimates of $5.25 billion by 1.8%. Adjusted EPS reached $1.27, beating estimates of $1.17 by 8.7%. Furthermore, Lam Research provided optimistic Q1 CY2026 revenue guidance of $5.7 billion (midpoint), which was 6.2% above analyst expectations of $5.37 billion. Adjusted EPS guidance for Q1 CY2026 was also strong at $1.35 (midpoint), exceeding analyst estimates of $1.20.
2. The Wafer Fabrication Equipment (WFE) market experienced significant projected growth, driven by increased capital expenditure across the semiconductor industry.
Lam Research anticipates a 23% increase in equipment sales for 2026, with the overall WFE market projected to grow approximately 23% year-over-year to $135 billion in CY26, up from $110 billion in 2025. This surge is fueled by rising capital expenditures from major clients, including leading foundries like TSMC and memory chipmakers such as Micron and SK Hynix.
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Stock Movement Drivers
Fundamental Drivers
The 43.3% change in LRCX stock from 11/30/2025 to 3/4/2026 was primarily driven by a 33.0% change in the company's P/E Multiple.| (LTM values as of) | 11302025 | 3042026 | Change |
|---|---|---|---|
| Stock Price ($) | 155.56 | 222.99 | 43.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 19,592 | 20,561 | 4.9% |
| Net Income Margin (%) | 29.7% | 30.2% | 1.9% |
| P/E Multiple | 33.9 | 45.0 | 33.0% |
| Shares Outstanding (Mil) | 1,264 | 1,255 | 0.8% |
| Cumulative Contribution | 43.3% |
Market Drivers
11/30/2025 to 3/4/2026| Return | Correlation | |
|---|---|---|
| LRCX | 43.3% | |
| Market (SPY) | 0.3% | 60.4% |
| Sector (XLK) | -2.3% | 69.1% |
Fundamental Drivers
The 123.7% change in LRCX stock from 8/31/2025 to 3/4/2026 was primarily driven by a 90.0% change in the company's P/E Multiple.| (LTM values as of) | 8312025 | 3042026 | Change |
|---|---|---|---|
| Stock Price ($) | 99.67 | 222.99 | 123.7% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 18,436 | 20,561 | 11.5% |
| Net Income Margin (%) | 29.1% | 30.2% | 4.0% |
| P/E Multiple | 23.7 | 45.0 | 90.0% |
| Shares Outstanding (Mil) | 1,274 | 1,255 | 1.5% |
| Cumulative Contribution | 123.7% |
Market Drivers
8/31/2025 to 3/4/2026| Return | Correlation | |
|---|---|---|
| LRCX | 123.7% | |
| Market (SPY) | 6.5% | 66.0% |
| Sector (XLK) | 6.7% | 72.2% |
Fundamental Drivers
The 193.6% change in LRCX stock from 2/28/2025 to 3/4/2026 was primarily driven by a 97.8% change in the company's P/E Multiple.| (LTM values as of) | 2282025 | 3042026 | Change |
|---|---|---|---|
| Stock Price ($) | 75.95 | 222.99 | 193.6% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 16,209 | 20,561 | 26.8% |
| Net Income Margin (%) | 26.5% | 30.2% | 14.1% |
| P/E Multiple | 22.8 | 45.0 | 97.8% |
| Shares Outstanding (Mil) | 1,287 | 1,255 | 2.6% |
| Cumulative Contribution | 193.6% |
Market Drivers
2/28/2025 to 3/4/2026| Return | Correlation | |
|---|---|---|
| LRCX | 193.6% | |
| Market (SPY) | 16.3% | 72.6% |
| Sector (XLK) | 24.6% | 79.6% |
Fundamental Drivers
The 374.0% change in LRCX stock from 2/28/2023 to 3/4/2026 was primarily driven by a 260.7% change in the company's P/E Multiple.| (LTM values as of) | 2282023 | 3042026 | Change |
|---|---|---|---|
| Stock Price ($) | 47.04 | 222.99 | 374.0% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 19,048 | 20,561 | 7.9% |
| Net Income Margin (%) | 26.9% | 30.2% | 12.3% |
| P/E Multiple | 12.5 | 45.0 | 260.7% |
| Shares Outstanding (Mil) | 1,360 | 1,255 | 8.4% |
| Cumulative Contribution | 374.0% |
Market Drivers
2/28/2023 to 3/4/2026| Return | Correlation | |
|---|---|---|
| LRCX | 374.0% | |
| Market (SPY) | 79.3% | 66.2% |
| Sector (XLK) | 109.0% | 76.3% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| LRCX Return | 54% | -41% | 89% | -7% | 139% | 27% | 386% |
| Peers Return | 50% | -40% | 51% | 2% | 50% | 42% | 197% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | -0% | 81% |
Monthly Win Rates [3] | |||||||
| LRCX Win Rate | 67% | 33% | 58% | 42% | 58% | 67% | |
| Peers Win Rate | 67% | 37% | 60% | 48% | 60% | 67% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 33% | |
Max Drawdowns [4] | |||||||
| LRCX Max Drawdown | 0% | -56% | -1% | -10% | -18% | 0% | |
| Peers Max Drawdown | -4% | -53% | -7% | -10% | -31% | 0% | |
| S&P 500 Max Drawdown | -1% | -25% | -1% | -2% | -15% | -1% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: AMAT, KLAC, TER, ENTG, MKSI. See LRCX Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 3/4/2026 (YTD)
How Low Can It Go
| Event | LRCX | S&P 500 |
|---|---|---|
| 2022 Inflation Shock | ||
| % Loss | -56.8% | -25.4% |
| % Gain to Breakeven | 131.7% | 34.1% |
| Time to Breakeven | 423 days | 464 days |
| 2020 Covid Pandemic | ||
| % Loss | -45.0% | -33.9% |
| % Gain to Breakeven | 81.8% | 51.3% |
| Time to Breakeven | 116 days | 148 days |
| 2018 Correction | ||
| % Loss | -46.1% | -19.8% |
| % Gain to Breakeven | 85.5% | 24.7% |
| Time to Breakeven | 259 days | 120 days |
| 2008 Global Financial Crisis | ||
| % Loss | -75.0% | -56.8% |
| % Gain to Breakeven | 299.9% | 131.3% |
| Time to Breakeven | 2,011 days | 1,480 days |
Compare to AMAT, KLAC, TER, ENTG, MKSI
In The Past
Lam Research's stock fell -56.8% during the 2022 Inflation Shock from a high on 1/14/2022. A -56.8% loss requires a 131.7% gain to breakeven.
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About Lam Research (LRCX)
AI Analysis | Feedback
```htmlLam Research is like Caterpillar for the semiconductor industry, providing the specialized equipment needed to 'build' chips.
Lam Research is like Schlumberger for semiconductor factories, supplying the critical equipment and services needed for chip production.
```AI Analysis | Feedback
- Deposition Equipment: Tools that apply thin layers of various materials onto semiconductor wafers, forming the foundational structures of integrated circuits.
- Etch Equipment: Systems designed to precisely remove material from specific areas of semiconductor wafers, critical for creating the intricate patterns of microchips.
- Clean Equipment: Solutions developed to remove contaminants from semiconductor wafers at various stages of the manufacturing process, ensuring device reliability and yield.
- Atomic Layer Etch (ALE) and Advanced Patterning Systems: Highly precise etch technologies and related systems for sub-nanometer material removal and advanced patterning capabilities essential for next-generation chip manufacturing.
AI Analysis | Feedback
Lam Research (LRCX) primarily sells its advanced wafer fabrication equipment and services to other companies within the semiconductor industry, specifically to leading manufacturers of integrated circuits.
While Lam Research's financial reports indicate that no single customer accounts for more than 10% of its total revenues, its major customers are the world's largest and most technologically advanced semiconductor manufacturers. These companies represent the primary segments of the semiconductor market that require Lam Research's specialized equipment for chip production.
The major customers and categories of customers for Lam Research include:
- Leading Foundries and Logic Device Manufacturers: These companies produce advanced logic chips for a wide range of applications, including processors, GPUs, and specialized ASICs.
- Memory Manufacturers: These companies specialize in producing DRAM (Dynamic Random-Access Memory) and NAND flash memory for storage and computing.
- Samsung Electronics (a leading producer of both DRAM and NAND) (Symbol: KRX:005930)
- Micron Technology (Symbol: MU)
- SK Hynix (Symbol: KRX:000660)
- Integrated Device Manufacturers (IDMs): Companies that design, manufacture, and sell their own integrated circuits. While some IDMs also operate foundries or memory fabs, this category broadly covers companies like:
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- MKS Instruments (MKSI)
- Advanced Energy Industries (AEIS)
- Brooks Automation (BRKS)
- INFICON (IFCNF)
- VAT Group (VACN.SW)
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Timothy M. Archer, President and Chief Executive Officer
Timothy M. Archer is the President and Chief Executive Officer at Lam Research, a position he has held since December 2018. He joined Lam Research in 2012 as executive vice president and chief operating officer following the company's acquisition of Novellus Systems, Inc.. Prior to joining Lam Research, Mr. Archer spent 18 years at Novellus Systems, Inc., where he served as Chief Operating Officer from January 2011 to June 2012, and held various other executive positions in technology development, business leadership, worldwide sales, marketing, and customer satisfaction. He began his career in 1989 at Tektronix, Inc., where he focused on process development for high-speed bipolar integrated circuits.
Douglas R. Bettinger, Executive Vice President, Chief Financial Officer
Douglas R. Bettinger is the Executive Vice President and Chief Financial Officer at Lam Research, overseeing finance, tax, treasury, investor relations, and corporate analytics. He joined Lam Research in 2013. Before his tenure at Lam, Mr. Bettinger served as Senior Vice President and Chief Financial Officer of Avago Technologies Ltd. (now Broadcom) from 2008 to 2013, and held executive finance positions with Xilinx, Inc., 24/7 Customer (a privately held company), and Intel Corp.. During his 19 years at Intel, he held various senior-level finance roles, including Vice President of Finance and Treasurer.
Patrick Lord, Executive Vice President and Chief Operating Officer
Patrick Lord is the Executive Vice President and Chief Operating Officer at Lam Research, responsible for driving efficiency, productivity, and business resilience across global operations. He joined Lam Research in 2012 following the acquisition of Novellus Systems. At Novellus, Mr. Lord held various executive leadership positions, including Senior Vice President and General Manager of the company’s Direct Metals, GapFill, Surface Integrity Group, and Integrated Metals Business Units. Earlier in his career, he worked at KLA-Tencor Corp., where he held several product management and marketing roles.
Audrey Charles, Senior Vice President of Corporate Strategy and Advanced Packaging; President of Lam Capital
Audrey Charles serves as Senior Vice President of Corporate Strategy and Advanced Packaging, and President of Lam Capital at Lam Research. In this role, she is responsible for leading the development of strategic priorities and key initiatives for the company's long-term growth and accelerating its market position in advanced packaging.
Sesha Varadarajan, Senior Vice President of Global Products Group
Sesha Varadarajan is the Senior Vice President of the Global Products Group at Lam Research, where he is responsible for all aspects of product groups, the worldwide lab network, and Lam India. He has held various technical and leadership positions during his 25-year tenure at Lam Research. Prior to his current role, he led the Deposition Business Unit and the PECVD/Electrofill Business Unit. Before Lam's acquisition of Novellus in 2012, he held several leadership roles at Novellus Systems, including General Manager of the PECVD and Electrofill Business Units.
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Lam Research (LRCX) faces several key business risks, primarily stemming from its global operations, the cyclical nature of the semiconductor industry, and complex supply chain dynamics.
Geopolitical Risks and Dependence on International Sales
A significant portion of Lam Research's revenue is derived from international sales, particularly in Asia, which accounts for approximately 87.9% of its total revenue, with China alone contributing 42.2%. This heavy reliance on global markets exposes the company to substantial geopolitical risks, including trade regulations, export controls (such as U.S. restrictions on selling advanced semiconductor equipment to China), trade disputes, and other international tensions. These factors can inhibit Lam Research's ability to sell its products, disrupt its revenue streams, and adversely affect its financial results.
Cyclical Nature of the Semiconductor Industry and Demand Volatility
The semiconductor capital equipment industry, in which Lam Research operates, is inherently cyclical, characterized by periods of rapid growth followed by downturns. This cyclicality can lead to significant fluctuations in the company's financial performance, revenue, and operating results. Variability in customers' business plans and overall industry demand can negatively impact the demand for Lam Research's equipment and services, making its financial outlook prone to change.
Supply Chain Disruptions and Manufacturing Constraints
Lam Research is susceptible to risks associated with disruptions in its global supply chain and manufacturing capacity constraints. Such disruptions can arise from various factors, including natural disasters, political unrest, or other events beyond its control, potentially leading to delays in product development and deliveries to customers. These challenges can increase operational costs, limit the company's ability to meet customer demand, and ultimately impact its profitability and business relationships.
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AI Analysis | Feedback
Lam Research (symbol: LRCX) is a leading global supplier of wafer-fabrication equipment and related services to the semiconductor industry. Its main products and services include equipment for thin film deposition, plasma etch, photoresist strip, and wafer cleaning processes, primarily used in front-end wafer processing.
The addressable markets for Lam Research's main products and services can be identified within the broader semiconductor manufacturing equipment market, as well as more specific segments like etch and deposition equipment.
- Global Semiconductor Manufacturing Equipment (WFE) Market:
- The global semiconductor manufacturing equipment market size was valued at approximately USD 101.78 billion in 2024 and is projected to grow to USD 123.13 billion in 2025, with an anticipated growth to USD 280.97 billion by 2035 at a CAGR of more than 8.6% from 2026-2035.
- Lam Research itself anticipates global Wafer Fabrication Equipment (WFE) spending to be in the mid-$90 billion range for calendar year 2024 and to rise slightly to approximately $100 billion in calendar year 2025.
- The Asia Pacific region dominated the semiconductor manufacturing equipment market, accounting for 68.7% of the global revenue share in 2024.
- Global Wafer Processing Equipment Market:
- The global wafer processing equipment market size was estimated at USD 9.19 billion in 2024 and is projected to reach USD 12.89 billion by 2030, growing at a CAGR of 5.9% from 2025 to 2030.
- The Asia Pacific region held the largest revenue share of 47.58% in this market in 2023.
- Global Semiconductor Etch and Deposition Equipment Market:
- This combined market is estimated at USD 15 billion in 2025 and is projected to exhibit a Compound Annual Growth Rate (CAGR) of 8% from 2025 to 2033.
- North America and Asia-Pacific are expected to dominate this market geographically.
- Global Semiconductor Etch Equipment Market:
- The global semiconductor etch equipment market size was valued at approximately USD 14.51 billion in 2024 and is projected to grow from USD 15.67 billion in 2025 to USD 28.26 billion by 2032, exhibiting a CAGR of 8.8% during the forecast period. Another estimate places the market size at USD 28.15 billion in 2024, increasing to USD 30.16 billion in 2025 and reaching approximately USD 56.1 billion by 2034, with a CAGR of 7.14%.
- The Asia Pacific region dominated the global semiconductor etch equipment market, holding a 61.69% share in 2023 and 70% share in 2024.
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Lam Research (LRCX) is expected to drive future revenue growth over the next two to three years through several key factors:
- Demand from Artificial Intelligence (AI) and Advanced Memory Technologies: The increasing demand for generative AI and other smart applications is fueling the need for advanced semiconductor technology. This translates into strong demand for high-bandwidth memory (HBM) and ongoing NAND upgrades, both of which are significant drivers for wafer fab equipment (WFE) spending. Additionally, industry trends such as Gate-All-Around (GAA) technology and advanced packaging further contribute to the demand for Lam Research's specialized etch and deposition solutions.
- Growth in Domestic China Spending: The China region has been a notable contributor to Lam Research's revenue, with spending from domestic Chinese customers expected to increase year-over-year in 2024. While the company anticipates a potential decline in its revenue contribution from China later in 2024, strong sales in this market are still cited by analysts as a positive factor.
- Broader Wafer Fab Equipment (WFE) Market Recovery and Increased Customer Utilization: The overall WFE cycle is in a recovery phase, which is beneficial for Lam Research. An observed uptick in fab utilization has led to double-digit quarter-over-quarter growth in spares revenues, signaling a broader resurgence in customer activity and spending on equipment maintenance and upgrades. This wider market recovery is projected to positively impact Lam Research's revenue.
- Expansion in Advanced Foundry-Logic Segments: Lam Research has demonstrated gains in the logic segment, with foundry's share of total systems revenue increasing. Growth in leading-edge spending within foundry logic, along with some support from mature nodes in China, is expected to be a continued driver of revenue.
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Share Repurchases
- Lam Research's Board of Directors approved a $10 billion share repurchase authorization in May 2024, which supplements prior authorizations and has no termination date.
- In fiscal year 2025, Lam Research returned $4.5 billion to stockholders through share repurchases and dividends.
- The company executed share buybacks of approximately $3.866 billion in 2022, $2.017 billion in 2023, and $2.843 billion in 2024.
Share Issuance
- Lam Research's shares outstanding have generally declined over the past few years, indicating net repurchases rather than significant issuances. For instance, shares outstanding for the quarter ending September 30, 2025, were 1.269 billion, a 2.66% decline year-over-year.
- The company's outstanding common shares were 1,291,958 as of September 29, 2024, and decreased to 1,259,176 as of September 28, 2025.
Outbound Investments
- Lam Research has made 8 acquisitions across 6 countries over time, with acquisition activity peaking in 2022 with two acquisitions, and one in 2023.
- The most recent acquisition was Esgee Technologies in January 2023, a provider of plasma, reactive flows, gas-phase, and surface chemistry mechanism development services.
- In November 2022, Lam Research acquired Semsysco, an Austria-based provider of wet-processing semiconductor equipment.
Capital Expenditures
- In fiscal year 2025, Lam Research's capital expenditure (CapEx) was -$759.19 million.
- Capital expenditures in the third quarter of fiscal 2025 were $288 million, with a major part of this increase attributed to a land purchase in India for planned lab expansions.
- Lam Research is investing over ₹10,000 crore (approximately $1.2 billion USD) in Karnataka, India, to build a manufacturing facility and expand equipment supply chains, focusing on advancing India's semiconductor ecosystem and R&D capabilities.
Latest Trefis Analyses
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|---|---|---|---|---|---|---|---|
| 02282026 | BMI | Badger Meter | Insider | Insider Buys 45DStrong Insider BuyingCompanies with multiple insider buys in the last 45 days | 0.0% | 0.0% | 0.0% |
| 02282026 | VRNS | Varonis Systems | Insider | Insider Buys 45DStrong Insider BuyingCompanies with multiple insider buys in the last 45 days | 0.0% | 0.0% | 0.0% |
| 02272026 | ITRI | Itron | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 0.0% | 0.0% | 0.0% |
| 02272026 | FSLR | First Solar | Dip Buy | DB | P/E OPMDip Buy with Low PE and High MarginBuying dips for companies with tame PE and meaningfully high operating margin | 0.0% | 0.0% | 0.0% |
| 02272026 | PEGA | Pegasystems | Dip Buy | DB | P/E OPMDip Buy with Low PE and High MarginBuying dips for companies with tame PE and meaningfully high operating margin | 0.0% | 0.0% | 0.0% |
| 11142025 | LRCX | Lam Research | Quality | Q | Momentum | UpsideQuality Stocks with Momentum and UpsideBuying quality stocks with strong momentum but still having room to run | 58.0% | 58.0% | -5.8% |
| 02282025 | LRCX | Lam Research | Monopoly | MY | Getting CheaperMonopoly-Like with P/S DeclineLarge cap with monopoly-like margins or cash flow generation and getting cheaper based on P/S multiple | 31.2% | 207.6% | -22.8% |
| 12312022 | LRCX | Lam Research | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 53.9% | 88.6% | -1.4% |
| 04302022 | LRCX | Lam Research | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | -12.3% | 14.2% | -31.9% |
| 09302018 | LRCX | Lam Research | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 19.5% | 56.0% | -18.2% |
Research & Analysis
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 270.21 |
| Mkt Cap | 120.7 |
| Rev LTM | 8,337 |
| Op Inc LTM | 3,141 |
| FCF LTM | 2,437 |
| FCF 3Y Avg | 2,043 |
| CFO LTM | 2,731 |
| CFO 3Y Avg | 2,310 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 11.4% |
| Rev Chg 3Y Avg | 3.0% |
| Rev Chg Q | 8.9% |
| QoQ Delta Rev Chg LTM | 2.2% |
| Op Mgn LTM | 29.4% |
| Op Mgn 3Y Avg | 24.8% |
| QoQ Delta Op Mgn LTM | 0.5% |
| CFO/Rev LTM | 26.3% |
| CFO/Rev 3Y Avg | 26.2% |
| FCF/Rev LTM | 18.0% |
| FCF/Rev 3Y Avg | 19.9% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 120.7 |
| P/S | 11.8 |
| P/EBIT | 37.0 |
| P/E | 49.3 |
| P/CFO | 35.9 |
| Total Yield | 2.4% |
| Dividend Yield | 0.4% |
| FCF Yield 3Y Avg | 3.8% |
| D/E | 0.0 |
| Net D/E | 0.0 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | 6.4% |
| 3M Rtn | 41.9% |
| 6M Rtn | 129.5% |
| 12M Rtn | 156.6% |
| 3Y Rtn | 204.2% |
| 1M Excs Rtn | 7.9% |
| 3M Excs Rtn | 46.9% |
| 6M Excs Rtn | 122.3% |
| 12M Excs Rtn | 139.5% |
| 3Y Excs Rtn | 144.3% |
Comparison Analyses
Price Behavior
| Market Price | $222.99 | |
| Market Cap ($ Bil) | 279.8 | |
| First Trading Date | 03/26/1990 | |
| Distance from 52W High | -10.6% | |
| 50 Days | 200 Days | |
| DMA Price | $217.41 | $143.91 |
| DMA Trend | up | up |
| Distance from DMA | 2.6% | 55.0% |
| 3M | 1YR | |
| Volatility | 56.7% | 52.1% |
| Downside Capture | 259.46 | 193.58 |
| Upside Capture | 474.69 | 269.50 |
| Correlation (SPY) | 59.8% | 72.6% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 2.76 | 2.83 | 3.06 | 2.98 | 1.93 | 1.94 |
| Up Beta | 4.16 | 2.89 | 3.60 | 2.77 | 1.75 | 1.79 |
| Down Beta | 0.50 | 0.37 | 1.51 | 2.17 | 1.79 | 1.68 |
| Up Capture | 339% | 674% | 677% | 898% | 765% | 3125% |
| Bmk +ve Days | 9 | 20 | 31 | 70 | 142 | 431 |
| Stock +ve Days | 11 | 22 | 35 | 76 | 148 | 399 |
| Down Capture | 272% | 239% | 211% | 202% | 138% | 112% |
| Bmk -ve Days | 12 | 21 | 30 | 54 | 109 | 320 |
| Stock -ve Days | 10 | 19 | 26 | 48 | 103 | 352 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with LRCX | |
|---|---|---|---|---|
| LRCX | 198.6% | 51.9% | 2.28 | - |
| Sector ETF (XLK) | 28.6% | 27.2% | 0.90 | 79.8% |
| Equity (SPY) | 18.5% | 19.2% | 0.76 | 72.7% |
| Gold (GLD) | 78.4% | 26.1% | 2.20 | 13.0% |
| Commodities (DBC) | 19.7% | 17.1% | 0.89 | 23.1% |
| Real Estate (VNQ) | 5.3% | 16.6% | 0.14 | 37.5% |
| Bitcoin (BTCUSD) | -20.7% | 45.1% | -0.38 | 34.8% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with LRCX | |
|---|---|---|---|---|
| LRCX | 33.9% | 45.5% | 0.79 | - |
| Sector ETF (XLK) | 17.5% | 24.7% | 0.63 | 78.4% |
| Equity (SPY) | 13.9% | 17.0% | 0.65 | 70.3% |
| Gold (GLD) | 23.4% | 17.3% | 1.11 | 13.7% |
| Commodities (DBC) | 11.2% | 19.0% | 0.47 | 16.4% |
| Real Estate (VNQ) | 5.2% | 18.8% | 0.18 | 37.0% |
| Bitcoin (BTCUSD) | 7.7% | 56.8% | 0.36 | 27.3% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with LRCX | |
|---|---|---|---|---|
| LRCX | 43.3% | 43.7% | 0.98 | - |
| Sector ETF (XLK) | 22.6% | 24.2% | 0.85 | 76.5% |
| Equity (SPY) | 15.4% | 17.9% | 0.74 | 70.4% |
| Gold (GLD) | 15.0% | 15.6% | 0.80 | 9.5% |
| Commodities (DBC) | 9.0% | 17.6% | 0.42 | 22.2% |
| Real Estate (VNQ) | 6.5% | 20.7% | 0.28 | 42.7% |
| Bitcoin (BTCUSD) | 66.2% | 66.8% | 1.06 | 19.2% |
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Earnings Returns History
Expand for More| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 1/28/2026 | 3.6% | -12.4% | -2.4% |
| 10/22/2025 | 4.5% | 13.7% | -1.2% |
| 7/30/2025 | -4.3% | -3.2% | 5.0% |
| 4/23/2025 | 6.2% | 7.4% | 23.7% |
| 1/29/2025 | 7.4% | 9.0% | 2.1% |
| 10/23/2024 | 5.1% | 4.9% | 0.4% |
| 7/31/2024 | -9.9% | -18.8% | -13.5% |
| 4/24/2024 | 1.9% | -1.9% | 8.3% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 13 | 13 | 14 |
| # Negative | 11 | 11 | 10 |
| Median Positive | 4.9% | 6.8% | 9.3% |
| Median Negative | -2.9% | -3.2% | -3.2% |
| Max Positive | 9.3% | 16.8% | 39.7% |
| Max Negative | -9.9% | -18.8% | -13.5% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 12/31/2025 | 01/29/2026 | 10-Q |
| 09/30/2025 | 10/24/2025 | 10-Q |
| 06/30/2025 | 08/11/2025 | 10-K |
| 03/31/2025 | 04/25/2025 | 10-Q |
| 12/31/2024 | 01/31/2025 | 10-Q |
| 09/30/2024 | 10/28/2024 | 10-Q |
| 06/30/2024 | 08/29/2024 | 10-K |
| 03/31/2024 | 04/29/2024 | 10-Q |
| 12/31/2023 | 01/29/2024 | 10-Q |
| 09/30/2023 | 10/23/2023 | 10-Q |
| 06/30/2023 | 08/15/2023 | 10-K |
| 03/31/2023 | 04/24/2023 | 10-Q |
| 12/31/2022 | 01/30/2023 | 10-Q |
| 09/30/2022 | 10/24/2022 | 10-Q |
| 06/30/2022 | 08/24/2022 | 10-K |
| 03/31/2022 | 04/26/2022 | 10-Q |
Insider Activity
Expand for More| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Archer, Timothy | President and CEO | Direct | Sell | 12182025 | 163.86 | 163,300 | 26,758,338 | 152,784,539 | Form |
| 2 | Bettinger, Douglas R | Chief Financial Officer & EVP | Direct | Sell | 11172025 | 150.60 | 40,080 | 6,036,048 | 148,677,892 | Form |
| 3 | Mayer, Bethany | Direct | Sell | 11102025 | 159.52 | 30 | 4,786 | 519,557 | Form | |
| 4 | Mayer, Bethany | Direct | Sell | 11042025 | 159.99 | 1,298 | 207,667 | 264,303 | Form | |
| 5 | Harter, Ava | Chief Legal Officer | Direct | Sell | 10282025 | 157.47 | 9,010 | 1,418,775 | 8,941,973 | Form |
LRCX Trade Sentinel
OVERWEIGHT (Score 9-10)
CONVICTION RATIONALE
The analysis yields a highly attractive probability-adjusted skew of 2.67x. This is driven by placing the company in a 'High Conviction Bull' regime (70% upside probability) due to its widening moat in the performance-critical segment and a strong secular sector trend fueled by AI. While the valuation is elevated, the powerful earnings growth trajectory justifies the premium, creating a favorable asymmetric risk/reward profile.
STOCK ARCHETYPE
Cyclical / CommodityLam Research manufactures and services semiconductor processing equipment. This industry is subject to pronounced cycles of high capital expenditure (capex) during periods of strong chip demand and sharp contractions when demand wanes, fitting the 'Cyclical' archetype. Valuation must be assessed based on normalized, mid-cycle earnings power rather than trailing metrics.
INVESTMENT THESIS
The primary driver for Lam Research is its technological dominance in etch and deposition, the most critical process steps for manufacturing next-generation AI chips, high-bandwidth memory (HBM), and gate-all-around (GAA) transistors. This leadership positions LRCX to disproportionately benefit from the AI-driven 'Super-Cycle' in Wafer Fabrication Equipment (WFE) spending, which is forecasted to reach $135 billion in 2026.
- The WFE market is forecast to grow to $135 billion in 2026, a 23% increase from 2025.
- The Advanced Packaging business, critical for AI hardware, is guided to grow over 40% in calendar 2026.
- LRCX is dominant in the 'Leading-Edge Foundry' customer segment, which is the epicenter of AI chip manufacturing.
- Record non-GAAP operating margin of 34.3% in the most recent quarter demonstrates strong pricing power and technological leadership.
PRIMARY RISK
The most significant risk is the geopolitical tension between the U.S. and China, leading to escalating export controls on advanced semiconductor equipment. With China accounting for 35% of revenue, any further restrictions by the U.S. Department of Commerce could materially impact Lam's revenue and earnings guidance, creating significant uncertainty not fully priced into the stock.
- China accounted for 35% of Lam Research's revenue as of the June 2025 quarter.
- The U.S. government continues to implement and update export controls, creating ongoing headline risk.
- Historical precedent: When broad restrictions were announced in October 2022, LRCX stock fell approximately 15% in the following month.
| KPI | Threshold | Rationale |
|---|---|---|
| Customer Support Business Group (CSBG) Revenue Growth | Maintain double-digit YoY growth | This high-margin, recurring revenue stream provides stability and visibility. Deceleration would signal a weakening of the underlying business fundamentals. |
| Gross Margins | >48% | Record high margins are evidence of pricing power and technological leadership. A contraction below this level could be an early indicator of a cyclical peak in profitability or increased competitive pressure. |
| Systems Revenue from China | Monitor for any guidance revisions below 25% of total revenue | Given China represents 35% of revenue, this is the most direct measure of the impact of geopolitical export controls, which is the primary risk to the thesis. |
AI Supercycle vs. Geopolitical/Cyclical Peak
BULL VIEW
AI is a structural tailwind driving a multi-year capex 'Super-Cycle'. Lam's etch leadership and recurring revenue provide resilience and pricing power through any short-term volatility.
CORE TENSION
Whether record demand from the AI build-out can override macro risks from China export controls and a potential cyclical peak in semiconductor capital spending.
PREVAILING SENTIMENT
The stalemate is evident: management's strong guidance and record margins are bullish, but are directly countered by the high China revenue concentration (35%) and elevated P/E ratio (~47-51x).
BEAR VIEW
High China revenue exposure (35%) is a critical vulnerability to new US export controls. Elevated valuation and margins are peaking as the cycle matures, risking sharp compression.
| Timeline | Event & Metric To Watch |
|---|---|
Late April 2026 | Q3 FY2026 Earnings Call & Guidance Watch: Gross Margin guidance and China revenue concentration percentage. A margin guide below 48% or unchanged/higher China exposure would be negative signals. |
Anytime | U.S. Export Control Updates on China Watch: Any new restrictions by the U.S. Department of Commerce (BIS) on etch or deposition equipment sales to Chinese fabs. |
Q2-Q3 2026 | Major Customer (TSMC, Intel, Samsung) Capex Updates Watch: Any downward revision to 2026 capex forecasts or commentary about a 'digestion period' for new equipment. |
Ongoing | Macro: 10-Year Treasury Yield Movement Watch: Sustainable break of the 10-Year Treasury Yield above 4.5%, signaling a 'risk-off' macro environment. |
| Date | Event | Stock Impact |
|---|---|---|
2025-09-10 | Goldman Sachs Communacopia + Technology Conference Details: Executive participation in a major technology conference, reinforcing the company's strategic positioning to investors. | Modest 1.70% gain $105.18 -> $106.97 |
2025-10-22 | Q1 FY2026 Earnings Release Details: Lam reported strong results and provided robust guidance for the December 2025 quarter, forecasting revenue of $5.2 billion, citing AI-related demand. | Rose significantly by 4.45% $141.01 -> $147.29 |
2025-11-21 | Strategic Investment Announcement Details: Lam announced it was deepening its investment in its Oregon-based R&D and manufacturing facilities to accelerate leadership in the AI era. | Rose significantly by 2.19% $139.36 -> $142.41 |
2025-12-02 | UBS Global Technology and AI Conference Details: Company leadership participated in the UBS conference, likely reinforcing their positive outlook on AI-driven demand. | Rose significantly by 2.20% $154.53 -> $157.93 |
2025-12-08 | US Government Policy Shift on AI Chip Exports Details: The US administration announced it would allow sales of certain advanced AI chips to China, a potential positive for equipment suppliers, though details remained pending. | Rose significantly by 2.55% $158.70 -> $162.74 |
2026-01-28 | Q2 FY2026 Earnings Release Details: Company reported Q2 EPS of $1.27, beating the consensus estimate of $1.17. Revenue of $5.34 billion also surpassed expectations of $5.23 billion. | Rose significantly by 3.58% $239.58 -> $248.17 |
Position Sizing
4%-6%
NORMAL
The stock's 'Explosive' volatility (4.8x S&P 500) and spiking term structure cap sizing. While fundamentals like high visibility and a strong moat are positive, the Neutral sentiment and expensive valuation prevent an Aggressive stance.
Diversification Alternatives
AMAT
INDUSTRYOffers broader exposure to the wafer fab equipment market beyond Lam's etch/deposition focus, but with lower margins and a significant legal overhang.
KLAC
INDUSTRYDominates the process control segment ('picks and shovels' for yield management), which is less cyclical than capacity-driven equipment sales. Diversifies risk away from direct etch/deposition competition.
Lam Research is a primary enabler of the AI hardware buildout, capitalizing on a structural increase in manufacturing complexity for advanced logic and 3D memory, while navigating significant geopolitical risk from its high revenue concentration in China.
Filter all news through the lens of Wafer Fab Equipment (WFE) spending intensity and China-related geopolitical developments.
Increases in the total WFE market forecast for 2026 (current estimate: $135B); specific design wins for new etch and deposition tools (e.g., Akara, Altus Halo) at leading-edge logic or memory customers; evidence of market share gains vs. Applied Materials or Tokyo Electron in 3D NAND or Gate-All-Around process steps.
Further US export controls targeting China's semiconductor industry; evidence of Chinese domestic equipment suppliers gaining share at major Chinese fabs; a downturn in the memory market recovery, particularly for NAND, leading to capex cuts.
Quarter-over-quarter shifts in regional revenue mix (ex-China), as this is common in the capex cycle; minor fluctuations in deferred revenue balances unless showing a sustained downward trend over multiple quarters; individual benchmark wins or losses that do not translate to broad platform adoption.
Repricing Catalyst
The ongoing AI-driven 'super-cycle' in semiconductor capex. Management and industry analysts forecast total Wafer Fab Equipment (WFE) spending to reach ~$135 billion in 2026, driven by intense investment in new fabs for AI accelerators, High-Bandwidth Memory (HBM), and Gate-All-Around transistors, all of which increase the complexity and number of etch and deposition steps where Lam is a market leader.
Semiconductor Manufacturing Systems (Etch & Deposition)
$13.4B TTM (62.8% of Total) · -99% MarginWhat It Is
Plasma etch systems (Kiyo, Vantex, Syndion, Akara) for creating microscopic circuits; Thin film deposition systems (VECTOR, ALTUS, SABRE) for depositing layers of conductive or insulating materials.
Who Pays & How
Major semiconductor manufacturers (Memory, Foundry, and IDMs) like Micron pay millions per machine because the entire chip manufacturing process is qualified on specific equipment. Switching vendors would require re-validating hundreds of process steps, costing billions and risking years of delays.
Competition
Customer Support & Services (CSBG)
$8.0B TTM (37.2% of Total) · -99% MarginWhat It Is
Spare parts, equipment upgrades, maintenance services, and refurbished tools for Lam's installed base of over 100,000 chambers.
Who Pays & How
Existing customers who own Lam equipment pay for spares and services to maintain and upgrade their multi-million dollar machines, maximizing uptime and extending the equipment's productive life.
Competition
External Quote Links
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