Lam Research’s Q2 EPS Beat by 8.5%, Guides $5.7B Q3 Revenue
Lam Research’s Q2 non-GAAP EPS of $1.27 beat estimates by 8.5% while revenue rose 22% y/y to $5.34B as gross margin declined 90bps to 49.7%. The company forecasts Q3 revenue of $5.7B ±$300M, EPS of $1.35 ±$0.10, and a 49% ±1% non-GAAP gross margin.
1. Q2 Earnings and Revenue Beats
Lam Research posted Q2 non-GAAP EPS of $1.27, up 39.6% year-over-year and 8.5% above consensus, while revenue rose 22% y/y to $5.34 billion, exceeding estimates by 2.1%.
2. Margin Compression and Operational Costs
Non-GAAP gross margin declined 90 basis points sequentially to 49.7%, and non-GAAP operating margin contracted by 70 basis points to 34.3% despite a 0.5% decrease in operating expenses to $827.5 million.
3. Segment, Regional Breakdown, and Cash Flow
Systems revenue reached $3.36 billion (62.8% of total), up 28% y/y but down 5.4% q/q, while Customer Support revenue climbed 13.5% y/y to $1.99 billion; China accounted for 35% of sales. Cash and equivalents stood at $6.18 billion, with operating cash flow of $1.48 billion.
4. Q3 Guidance and Share Performance
For Q3, management forecasts revenues of $5.7 billion ±$300 million, non-GAAP gross margin of 49% ±1%, operating margin of 34% ±1%, and EPS of $1.35 ±$0.10; shares have declined 3.7% since the earnings release.