Lam Research slides as component shortage limits FY growth outlook
LRCX•Lam Research shares fell 7.8% premarket after the company warned that component shortages could constrain growth, despite forecasting second-quarter revenue and adjusted profit above analysts’ expectations. CEO Timothy Archer said 2026 wafer fab equipment spending is expected in the mid-$150 billion range, with a preliminary estimate of more than $200 billion in 2027.
1. Supply limits growth outlook
Lam Research shares fell 7.8% to $240.59 in premarket trading. The company forecast second-quarter revenue and adjusted profit above analysts’ expectations, but analysts raised concerns about shortages of chips and other tools used to make its products.
2. Spending and analyst views
CEO Timothy Archer said on a conference call that 2026 wafer fab equipment spending is expected in the mid-$150 billion range, with a preliminary estimate of more than $200 billion in 2027 as supply-chain constraints limit growth. Citigroup cautioned against raising 2027 and 2028 growth expectations because of shortages of DRAM, PCB boards and magnets, and cut its price target to $435 from $450. TD Cowen said it could take two quarters for the supply chain to catch up, potentially stalling Lam’s earnings revisions before they resume higher. The stock was also affected by a semiconductor-sector selloff on Thursday.
