Lam Research (LRCX) Q4 2024 earnings summary

Executive summary

• June 2024 quarter revenue, profitability, and EPS all exceeded guidance midpoints, driven by strong execution and growth in the customer support business.

• Achieved highest gross margin since 2013 merger at 48.2% (non-GAAP), with strong free cash flow of $4.3B (29% of revenue).

• Strategic investments in product development, R&D infrastructure, and digital transformation continue to position for multi-year wafer fab equipment spending growth.

• Malaysia factory shipped its 5,000th chamber, marking the fastest ramp in company history.

• Customer Support Business Group (CSBG) revenue grew 22% quarter-over-quarter, driven by Reliant and spares.

Financial highlights

• June quarter revenue: $3.87B, up sequentially and above guidance midpoint.

• Non-GAAP gross margin: 48.5%; GAAP gross margin: 47.5%.

• Non-GAAP operating margin: 30.7%; GAAP operating margin: 29.1%.

• Non-GAAP diluted EPS: $8.14, near high end of guidance; GAAP diluted EPS: $7.78.

• Cash and equivalents: $5.9B at quarter end, up from $5.7B prior quarter.

Outlook and guidance

• September 2024 quarter revenue guidance: $4.05B ± $300M.

• Gross margin guidance: 47% ± 1ppt (non-GAAP), reflecting customer mix headwinds.

• Operating margin guidance: 29.5% ± 1ppt (non-GAAP).

• EPS guidance: $8 ± $0.75, share count ~131M.

• WFE spending for 2024 expected in mid-$90B range; positive outlook for 2025.