Semiconductor equipment manufacturer Lam Research (NASDAQ:LRCX) announced its first-quarter 2026 results, which surpassed market revenue forecasts, showing a 23.8% increase from the previous year, reaching $5.84 billion. Additionally, its revenue forecast for the upcoming quarter was pleasantly surprising, at $6.6 billion at the midpoint, outpacing analyst expectations by 9.4%. The non-GAAP earnings per share (EPS) stood at $1.47, exceeding estimates by 7.9%.
So, is it a good moment to invest in Lam Research?
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Revenue: $5.84 billion (23.8% growth year-on-year, 1.7% above expectations of $5.74 billion)
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Adjusted EPS: $1.47 (7.9% above expectations of $1.36)
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Adjusted operating profit: $2.05 billion, compared to expectations of $1.97 billion (35% margin, 3.9% above)
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Q2 2026 Earnings Guidance: At midpoint, it projected $6.6 billion, higher than the predicted $6.03 billion.
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Adjusted EPS guidance for Q2 2026: Midpoint of $1.65, outpacing expectations of $1.45.
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Operating profit margin: 35%, an increase from 33.1% the previous year.
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Free cash flow margin: 13.9%, down from 21.6% last year.
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Days left in stock: 124, down from 136 last quarter.
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Market capitalization: $322.6 billion.
“Lum achieved record revenue and EPS in the March quarter, driven by AI-related demand reshaping the semiconductor sector,” stated Tim Archer, the company’s president and CEO.
Launched in 1980 by David Lamb, a pioneer in semiconductor etch technology, Lam Research (NASDAQ:LRCX) is a top provider of wafer fabrication equipment in semiconductor manufacturing.
Analyzing a company’s long-term sales growth offers valuable insights into its overall quality. While short-term success is possible for many companies, exceptional firms tend to maintain growth over extended periods. Fortunately, Lam Research has shown a commendable compound annual growth rate of 10.3% over the past five years, outstripping the average growth rates of competitors in the semiconductor sector. This suggests a strong market fit for its products, which is a good starting point for analysis. Given the cyclical nature of semiconductors, long-term investors should be ready for waves of strong growth followed by lower earnings, which can often present good buying chances.
In the fast-paced semiconductor industry, leaving behind shorter-term results can prove crucial, especially since rapid technological changes often render past products obsolete. Lam Research has seen an annual sales growth rate of 23.4% over the last two years, indicating that demand is strong and gaining momentum.
