Lam Research Corp (NASDAQ:LRCX) stock rose 1.03% (As on January 29, 11:25:10 AM UTC-4, Source: Google Finance) after the company reported a strong fiscal Q2 2026, with earnings and revenue exceeding market expectations. In 2025, the company achieved record revenues of more than $20 billion and expanded the served available market, or SAM, share of WFE into the mid-30s% range. The ship share of WFE grew by well over 1 percentage point year-on-year, and the CSPG business hit key milestones, with the size of the installed base topping 100,000 chambers and revenue growing faster than the increase in installed base units. The AI transformation is driving industry spending higher. In 2025, WFE came in close to $110 billion. The initial 2026 view is for WFE to be in the $135 billion range, with the growth in spending remaining constrained by a shortage of available clean room space. The company expects WFE this year to be weighted to the second half, with robust growth in investments across all three device segments, led by DRAM and leading-edge foundry logic.
Moreover, the deferred revenue balance at quarter end came in at $2.25 billion, down sequentially due to an approximately $500 million reduction in those customer advance down payments. From a market segment perspective, foundry accounted for 59% of the systems revenue in the December quarter, slightly down sequentially, but up from 35% in the December 2024 period. Memory was 34% of systems revenue, in line with prior quarter. Within memory, the company generated record DRAM revenue, accounting for 23% of systems revenue, which was up from 16% in the September quarter. The logic and other segment came in at 7% of systems revenue in the December quarter, slightly up sequentially.
LRCX in the second quarter of FY26 has reported the adjusted earnings per share of $1.27, beating the analysts’ estimates for the adjusted earnings per share by 10 cents. The company had reported the adjusted revenue growth of 0.4 percent to $5.34 billion in the second quarter of FY26, beating the analysts’ estimates for revenue by $100 million. The December quarter operating margin was 34.3%. Cash and cash equivalents totaled $6.2 billion at the end of the December quarter, a decrease from $6.7 billion at the end of the September quarter.
Looking ahead to the quarter ending March 29, 2026, Lam expects revenue between $5.70 billion, plus or minus $300 million, compared to the consensus of $5.33 billion. The company anticipates a gross margin of 49% and an operating income margin of 33.9%. The company continues to expect capital expenditure to be in the 4%-5% of revenue range.