Lam Research (LRCX) — Company Research

Last Updated: 28 June 2026

Lam Research (NASDAQ: LRCX) is one of the world's largest makers of wafer-fabrication equipment, specialising in the deposition, etch and clean steps that physically build the transistors and 3D memory stacks inside every advanced chip. As the AI build-out drives record spending on leading-edge logic, high-bandwidth memory and advanced packaging, Lam has posted its strongest results on record — while its shares have re-rated dramatically, leaving the stock priced for sustained, cycle-defying growth. This report walks through the numbers, the moat, the competition and the risks, sourced entirely from company filings and primary disclosures.

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1. Company Snapshot

Field	Value
Exchange / Ticker	NASDAQ: LRCX
Sector	Technology — Semiconductor Equipment
Market cap	~$474bn (26 Jun 2026)
Revenue (FY2025)	$18.44bn (fiscal year ended 29 Jun 2025)
Net income (FY2025)	$5.36bn (GAAP)
CEO	Timothy (Tim) Archer, President & Chief Executive Officer
Employees	~19,700
Headquarters	Fremont, California, USA
Founded	1980
Fiscal year end	Last Sunday of June (FY2025 ended 29 Jun 2025)
Dividend	~$1.04/share annualised (~$0.26 quarterly); split-adjusted

Lam executed a 10-for-1 forward stock split effective 2 October 2024; all per-share figures in this report are stated on the post-split basis.

2. Bull & Bear Case

Bull Case

• AI-era deposition & etch criticality: The shift to gate-all-around transistors, 3D DRAM, high-bandwidth memory and advanced packaging multiplies the number of deposition and etch steps per wafer — the exact processes Lam dominates — structurally lifting its served market.
• Record financial momentum: FY2025 revenue rose 23.7% to $18.44bn and GAAP EPS jumped to $4.15, and the March-2026 quarter set fresh records at $5.84bn revenue with management guiding the June quarter to ~$6.60bn.
• Growing recurring base: The Customer Support Business Group delivered its first $2.1bn quarter in March 2026, a large installed-base annuity (spares, service, upgrades, Reliant tools) that smooths the cyclicality of new-systems sales.
• Shareholder returns & balance sheet: Lam runs a net-cash balance sheet, has bought back roughly $3.4bn of stock in FY2025 and raised the dividend, returning the bulk of free cash flow to shareholders.

Bear Case

• Rich valuation: At roughly 71x trailing GAAP earnings the shares discount many years of uninterrupted growth; any wobble in AI capex or memory pricing could trigger sharp multiple compression.
• Industry cyclicality: Wafer-fab equipment spending has always been boom-and-bust — FY2024 revenue fell ~15% — and the current up-cycle will eventually turn.
• China & export-control exposure: China was ~34% of March-2026 revenue; tighter US export rules or a pull-back in Chinese mature-node investment would directly dent sales.
• Customer concentration: A handful of leading-edge logic and memory makers drive most revenue, so a single customer's capex deferral has an outsized effect.

3. Revenue Segments

Lam reports as a single operating segment but discloses revenue between new Systems and recurring Customer Support, shown below using the March-2026 (Q3 FY2026) quarter.

Segment	% of revenue (Q3 FY2026)	What it is
Systems	~64% ($3.73bn)	New leading-edge equipment for deposition, etch and clean — the tools that build transistor and memory structures at the most advanced nodes.
Customer Support Business Group (CSBG)	~36% ($2.11bn)	Recurring spares, service, upgrades and non-leading-edge Reliant® systems sold into the large installed base.

By geography, March-2026 revenue skewed to Asia: China ~34%, Korea ~23%, Taiwan ~23%, Japan ~8%, United States ~6%, with Southeast Asia and Europe making up the balance.

4. Business Model

Lam sells the capital equipment that chipmakers install in their fabs, then earns a long, high-margin annuity servicing that equipment for its operating life.

How it makes money: The Systems business sells deposition (ALD/CVD/ECD), plasma etch and clean tools, typically multi-million-dollar machines bought in waves as customers add leading-edge capacity. The Customer Support Business Group then generates recurring revenue from spares, service contracts, productivity upgrades and refurbished Reliant tools across a growing installed base.

Unit economics & moat: FY2025 gross margin was 48.7% and operating margin 32.0%, reflecting high switching costs — once a process is qualified on a Lam tool, customers rarely re-qualify a rival mid-node. Deep process know-how in etch and deposition, co-development with the top foundries and memory makers, and a wide patent estate underpin the moat.

Capital allocation: Lam converts a high share of earnings to free cash flow and returns most of it via buybacks and a rising dividend, operating with net cash on the balance sheet.

5. Financial Health

Annual figures below are from Lam's audited statements and quarterly press releases; all per-share data is split-adjusted (10-for-1, October 2024).

Fiscal Year	Revenue	YoY %	GAAP EPS	Adjusted EPS	Dividend / Share	Long-Term Debt (YE)
FY2021	$14.63bn	—	$2.69	—	$0.52	—
FY2022	$17.23bn	+17.8%	$3.28	—	$0.60	—
FY2023	$17.43bn	+1.2%	$3.32	—	$0.69	—
FY2024	$14.91bn	−14.5%	$2.90	$3.36	$0.80	$4.48bn
FY2025	$18.44bn	+23.7%	$4.15	$4.89	$0.92	$3.73bn

Quarterly trend (most recent first); the bold row is the last completed fiscal year. Lam's FY2026 is in progress, with three quarters reported.

Quarter	Revenue	Adjusted EPS	GAAP EPS
Q3 FY2026 (Mar 2026)	$5.84bn	$1.47	$1.45
Q2 FY2026 (Dec 2025)	$5.34bn	$1.27	$1.26
Q1 FY2026 (Sep 2025)	$5.32bn	$1.26	$1.24
Q4 FY2025 (Jun 2025)	$5.17bn	$1.33	$1.35
FY2025 (full year)	$18.44bn	$4.89	$4.15

6. Valuation

Raw metrics, June 2026. Not opinions on whether the stock is cheap or expensive.

Metric	Value
Market Cap	~$474bn (26 Jun 2026 close $379.09 × ~1.25bn shares)
Enterprise Value	~$473bn (market cap ~$474bn + total debt ~$3.73bn − cash ~$4.75bn per 29 Mar 2026 balance sheet; ~$1.0bn net cash)
Trailing P/E (GAAP)	~71x ($379.09 / TTM GAAP EPS ~$5.30; TTM = 9M FY2026 $3.95 + Q4 FY2025 $1.35)
P/E (forward)	~57x ($379.09 / annualised June-2026 guidance EPS ~$6.60; management guide $1.65 × 4)
P/S (TTM)	~22x (market cap ~$474bn / TTM revenue ~$21.68bn)
EV/EBITDA (TTM)	~60x (EV ~$473bn / EBITDA ~$7.85bn; EBITDA = TTM operating income ~$7.43bn + D&A ~$0.42bn)
P/FCF	~79x (market cap ~$474bn / FCF ~$6.0bn; FCF = TTM operating CF ~$6.95bn − capex ~$0.95bn)
52-week high	$409.75
52-week low	$90.94
Short interest (% of float)	~2.3% (~28.56m shares, latest settlement)
Days to cover	~2 days

7. What They're Building

Lam's roadmap is aimed squarely at the structural changes the AI era is forcing onto chip manufacturing. In patterning, the company is ramping its Aether® dry-resist suite — an underlayer, dry photoresist and dry-develop process co-developed with ASML and imec to extend EUV lithography — which is now in production at two memory makers, against a stated multi-year revenue target of roughly $1.5bn.

In metallisation, Lam introduced molybdenum atomic layer deposition on its ALTUS® Halo platform, positioned as the first high-volume Mo ALD tool for advanced interconnects. Across deposition and etch, the company is targeting the additional process steps required by gate-all-around logic, 3D DRAM and high-bandwidth memory, where vertical, high-aspect-ratio structures lean heavily on Lam's etch and deposition leadership. Management frames AI as the driver of a chip-equipment market it sees scaling toward ~$140bn.

8. Competitive Landscape

Lam competes within a consolidated group of five firms that together dominate wafer-fab equipment. It leads in etch and is a top-two player in deposition, while peers anchor different niches.

Peer	Market Cap (Jun 2026)	Key 2025 metric
ASML	~$693bn	Sole supplier of EUV lithography; reported record quarterly bookings of ~$15.7bn (Jan 2026)
Applied Materials (AMAT)	~$500bn	Broadest WFE portfolio — deposition, etch, CMP, ion implant and inspection
KLA Corporation (KLAC)	~$314bn	Process-control and inspection leader; completed a 10-for-1 split in June 2026

Privately held and regional players such as Tokyo Electron also compete directly in deposition and etch, but the five-firm oligopoly structure gives incumbents like Lam durable pricing power and high barriers to entry.

9. Leadership & Ownership

Lam is led by President and CEO Timothy (Tim) Archer, who has run the company since 2018. Recent insider activity is dominated by the CEO's scheduled, plan-based transactions rather than open-market signalling.

Name	Date	Type	Shares	Price	Value	Plan Type
Timothy Archer (CEO)	17 Dec 2025	Sale	163,300	~$163.86	~$26.76m	Rule 10b5-1 (adopted 19 Aug 2025)
Timothy Archer (CEO)	04 Feb 2026	RSU/PRSU settlement	271,530	$0.00	—	Equity award vesting
Timothy Archer (CEO)	24 Feb 2026	Gift	7,080	—	—	Bona fide gift (code G)

After the February 2026 award, the CEO directly held roughly 1.2m shares, with additional indirect holdings through retirement accounts. Lam is overwhelmingly institutionally owned, typical of a large-cap S&P 500 constituent.

10. Key Risks

• Valuation / expectations (Market): At ~71x trailing earnings the shares price in years of sustained growth; disappointment on AI capex or memory pricing could compress the multiple sharply.
• Industry cyclicality (Macro): Wafer-fab equipment demand is cyclical and capex-driven; FY2024 revenue already fell ~15%, and the current up-cycle will eventually peak.
• China & export controls (Regulatory): China contributed ~34% of March-2026 revenue; tighter US export rules or weaker Chinese mature-node investment would directly reduce sales.
• Customer concentration (Operational): A small number of leading-edge logic and memory makers drive most revenue, so a single customer's deferral has an outsized impact.
• Competition (Operational): Applied Materials and Tokyo Electron contest deposition and etch, and any share loss at a critical node erodes long-run economics.
• Technology-transition execution (Operational): Lam must keep winning process qualifications at each node (GAA, 3D DRAM, HBM, dry resist); a single misstep can cede a socket for a full product generation.

11. Recent Developments

• 22 Apr 2026 — Record March-quarter results. Lam reported Q3 FY2026 revenue of $5.84bn (+24% year on year) and GAAP EPS of $1.45, with the Customer Support group posting its first $2.1bn quarter; management guided the June 2026 quarter to ~$6.60bn revenue and ~$1.65 EPS.
• 31 May 2026 — CEO frames a ~$140bn equipment opportunity. In reported remarks, Tim Archer described AI as fuelling a chip-equipment market scaling toward roughly $140bn, with deposition and etch intensity rising in the 3D/AI era.
• 02 Sep 2025 — Dry-resist collaboration and dispute settlement. Lam and JSR/Inpria entered a cross-licensing and collaboration agreement and resolved prior disputes, underpinning Lam's Aether dry-resist push for EUV patterning.

12. Key Dates

• 29 Jul 2026 — Fourth-quarter and full-year fiscal 2026 results (expected)
• Expected Aug 2026 — Fiscal 2026 Form 10-K filing
• Expected Sep 2026 — Next quarterly dividend ex-date (~$0.26/share)
• Expected Oct 2026 — First-quarter fiscal 2027 results

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