Lam Research (LRCX) Q1 2027 earnings summary

Executive summary

• September-quarter revenue, gross margin, operating margin and EPS reached records; non-GAAP operating margin exceeded 40% for the first time.

• AI-driven demand and rising deposition and etch intensity support a multiyear investment cycle and a third consecutive year of WFE outperformance in 2026.

Financial highlights

• Revenue was $8.219B, up 22% QoQ and 54% YoY; systems revenue was $5.733B, up 62% YoY, and CSBG revenue was $2.487B, up 40% YoY.

• Non-GAAP net income was $2.768B and diluted EPS was $2.20; GAAP net income was $2.753B and diluted EPS was $2.19.

• Deferred revenue reached $2.66B, up $227M from June, primarily reflecting higher sales volume.

• Record free cash flow was $3.24B; operating cash flow was $3.498B.

• September-quarter non-GAAP operating expenses were $1.004B, versus $916M in June, primarily reflecting higher incentive compensation.

Outlook and guidance

• December-quarter guidance: revenue $8.60B ±$400M, gross margin 52.5% ±1 point, operating margin 40.5% ±1 point, and diluted EPS $2.33 ±$0.15 on 1.253B shares.

• Near-term supply tightness slightly constrained December revenue guidance; shipments delayed from December by timing are expected in March.

• 2026 systems revenue is expected to grow well over 40% YoY; 2026 WFE is forecast in the mid-$150B range, with preliminary 2027 WFE above $200B.

• CSBG revenue is expected to grow >30% in 2026 and >15% in 2027; advanced packaging is expected to grow 70% in 2026 and continue growing strongly in 2027.

• Gross margin is expected to fluctuate near current levels in the near term, with a multiyear opportunity to reach the mid-50% range.