01—Abstract
Summary
Summary of the 10-Q filed January 29, 2026. Cited figures are marked; the original filing is the authoritative source.
Lam Research Corporation (LRCX) reported strong financial performance for the quarter and six months ended December 28, 2025, demonstrating robust revenue growth and increased profitability.
Revenue for the six months surged to $10.67 billiona, up from $8.54 billion in the prior year, driven by increased demand for foundry equipment and higher customer support revenue. Net income followed suit, rising to $3.16 billion for the same period. The company's strategic focus on innovation in deposition, etch, and clean markets, coupled with a growing demand for advanced semiconductors from sectors like AI and cloud computing, positions it favorably for continued growth.
Investors can take note of the company's significant capital allocation towards share repurchases and dividends, underscoring a commitment to returning value to shareholders while maintaining a healthy liquidity position. Despite the positive financial results, the company operates within a dynamic semiconductor industry susceptible to global economic shifts and trade policy changes. Management's proactive approach to R&D and customer relationships remains crucial.
The company's substantial cash reserves provide a buffer against industry cyclicality and unforeseen market challenges. The report highlights Lam Research's continued investment in technological advancements to meet evolving customer needs in areas like 3D device scaling and multiple patterning, reinforcing its leadership position in the wafer fabrication equipment market.
02—Key points
Key Highlights
- Revenue for the six months ended December 28, 2025, increased by 24.9% year-over-year to $10.67 billion, driven by strong performance in foundry equipment and customer support.
- Net income for the six months ended December 28, 2025, grew by 37.1% year-over-year to $3.16 billion.
- Diluted earnings per share for the six months increased to $2.50, up from $1.78 in the prior year's comparable period.
- The company significantly increased its share repurchases, spending $2.44 billion on treasury stock purchases during the six months ended December 28, 2025.
- Cash, cash equivalents, and restricted cash stood at $6.2 billion as of December 28, 2025, indicating a strong liquidity position.
- Gross margin as a percentage of revenue improved to 50.0% for the six months ended December 28, 2025, compared to 47.7% in the prior year, benefiting from favorable customer mix.
- Operating income for the six months increased by 40.1% year-over-year to $3.64 billion.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2026, Lam Research Corp kept $0.30.
- Revenue$5.34B100.0%
- Cost of revenue−$2.69B50.4%
- Gross profit$2.65B49.6%
- Operating costs−$841.0M15.7%
- Operating income$1.81B33.9%
- Interest, other & tax−$216.2M4.0%
- Net income$1.59B29.8%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed January 29, 2026Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $5.34B$4.38B | +22.1% |
| Gross Profit | $2.65B$2.07B | +27.9% |
| R&D Expenses | $573.30M$494.95M | +15.8% |
| SG&A Expenses | $267.65M$244.15M | +9.6% |
| Operating Expenses | $840.96M$739.10M | +13.8% |
| Operating Income | $1.81B$1.33B | +35.7% |
| Net Income | $1.59B$1.19B | +33.8% |
| EPS (Basic) | $1.27$0.93 | +36.6% |
| EPS (Diluted) | $1.26$0.92 | +37.0% |
| Shares Outstanding (Basic) | 1.25B1.29B | −2.5% |
| Shares Outstanding (Diluted) | 1.26B1.29B | −2.3% |
05—Questions
Frequently Asked Questions
What drove the significant increase in revenue and net income for Lam Research?
The substantial growth in revenue and net income was primarily driven by robust demand for foundry equipment and a rise in customer support-related revenue. This indicates strong market adoption of Lam Research's solutions and effective service offerings, particularly in the foundry segment and for maintaining installed equipment performance.
How is Lam Research managing its capital, and what is its approach to shareholder returns?
Lam Research maintains a strong liquidity position with $6.2 billion in cash, cash equivalents, and restricted cash as of December 28, 2025. The company is actively returning capital to shareholders through significant share repurchases, totaling $2.44 billion in the first six months of the fiscal year, and dividend payments. This demonstrates a commitment to enhancing shareholder value while supporting ongoing business operations and strategic investments.
What are the key risks or challenges facing Lam Research, as highlighted in the filing?
The company faces several risks, including the inherent cyclicality and rapid technological changes within the semiconductor industry, intense global competition, dependence on a limited number of key customers, and the geopolitical and trade-related uncertainties, particularly concerning sales to China. Supply chain disruptions and evolving regulatory environments also pose ongoing challenges.
How does Lam Research's geographic revenue breakdown look, and are there any significant shifts?
For the six months ended December 28, 2025, China represented the largest portion of revenue at 39%, followed by Taiwan (20%), and Korea (17%). Compared to the prior year, there's a notable increase in the revenue share from Taiwan and a slight decrease from Korea, suggesting a potential geographic shift in demand or customer investment patterns within key semiconductor manufacturing regions.
06—Continue