Lam Research (LRCX) Q3 2025 earnings summary

Executive summary

• March quarter 2025 revenue reached $4.72 billion, up 8% sequentially, with record foundry revenues, strong product momentum at leading-edge inflections, and EPS exceeding guidance midpoints.

• Gross margin hit a record 49.0%, the highest since the Novellus merger, driven by operational efficiencies and investments.

• Operating margin was 33.1%, and diluted EPS was $1.04 (non-GAAP), both above prior quarter and guidance.

• Management remains focused on expanding served market, gaining share in key technology inflections, and growing CSBG revenue faster than the installed base.

• Confidence in outperforming semiconductor industry growth despite tariff-related uncertainty.

Financial highlights

• Deferred revenue at quarter end was $2.01 billion, with $587 million in future revenue from Japan shipments.

• Customer Support Business Group (CSBG) revenue was $1.68 billion, up year-over-year but slightly down sequentially.

• Operating expenses were $763 million, with 70% allocated to R&D; Q3 R&D expense was $525.9 million.

• Cash and short-term investments totaled $5.5 billion; total debt declined to $4.5 billion after retiring $500 million in notes.

• Returned $347 million via share repurchases and $296 million in dividends; $8.8 billion remains authorized for buybacks.

Outlook and guidance

• June 2025 quarter revenue guidance is $5.00 billion (+/- $300 million), with gross margin expected at 49.5% (non-GAAP) and operating margin at 33.5% (non-GAAP).

• Earnings per share guidance is $1.20 (+/- $0.10), based on 1.28 billion shares.

• Guidance incorporates current tariff impacts and excludes potential impacts from future M&A or restructuring.

• Tax rate for June quarter expected in single digits due to a reserve release; low to mid-teens for the rest of the year.

• WFE spending for 2025 forecasted at ~$100 billion.