Lam Research (LRCX) Q2 2026 earnings summary

Executive summary

• Delivered record revenue of $20.6 billion in 2025, up 27% year-over-year, with strong execution and broad-based strength across product lines, and December quarter revenue of $5.34 billion, exceeding guidance midpoints.

• Gross margin, operating margin, and EPS all exceeded the high end of guidance, with non-GAAP diluted EPS for 2025 at $4.89, up from $3.36 year-over-year.

• Significant market share gains in NAND and foundry logic, driven by technology transitions, new product launches, and AI-driven demand.

• Advanced packaging and AI-driven demand are accelerating growth, with advanced packaging expected to grow over 40% in 2026.

• Progressed on Investor Day commitments, targeting more than 2x revenue and profit growth over five years, supported by vertical scaling and strategic investments.

Financial highlights

• 2025 gross margin was 49.9%, the highest since the Novellus merger, with gross profit up 31% to $10.3 billion.

• December quarter 2025 revenue was $5.34B, up from $4.38B year-over-year and slightly up sequentially; non-GAAP gross margin was 49.7%, and non-GAAP operating margin was 34.3%.

• Diluted EPS for 2025 was $4.89, up 49% year-over-year; December quarter EPS was $1.27 (non-GAAP) and $1.26 (GAAP), both above guidance.

• Deferred revenue at quarter end was $2.25 billion, down sequentially due to reduced customer advance payments.

• Cash and equivalents ended at $6.2 billion, down from $6.7 billion in September, reflecting capital returns and CapEx.

Outlook and guidance

• 2026 March quarter revenue guidance is $5.70 billion ±$300 million, with gross margin of 49% ±1ppt and operating margin of 34% ±1ppt (non-GAAP); EPS guidance is $1.35 ±$0.10.

• WFE market forecasted to grow from $110 billion in 2025 to $135 billion in 2026, with growth weighted to the second half due to clean room constraints.

• Company expects to outperform WFE growth and expand market share in 2026.

• Anticipates secular semiconductor demand and technology inflections to drive long-term growth, but short-term volatility expected from trade restrictions and global economic uncertainty.