Lam Research Q3 Earnings Surpass Expectations, Revenues Rise Y/Y

Lam Research Corporation LRCX delivered third-quarter fiscal 2026 results, wherein both top and bottom lines surpassed the Zacks Consensus Estimate.LRCX reported fiscal third-quarter non-GAAP earnings of $1.47 per share, beating the Zacks Consensus Estimate by 8.1%. The bottom line increased 41.3% on a year-over-year basis.In the third quarter of fiscal 2026, LRCX reported revenues of $5.84 billion, which rose 23.8% year over year and surpassed the consensus estimate by 1.3%. Strength was supported by an accelerating AI-driven semiconductor demand backdrop and a record quarter for customer support activities.Lam Research Corporation Price, Consensus and EPS Surprise Lam Research Corporation price-consensus-eps-surprise-chart | Lam Research Corporation QuoteLRCX Revenue Mix Shows Broad-Based StrengthIn the third quarter of fiscal 2026, Systems revenues were $3.73 billion (63.9% of total revenues), up 24% on a year-over-year basis. The Zacks Consensus Estimate for Systems revenues was pegged at $3.82 billion.Customer Support Business Group revenues totaled $2.11 billion (36.1% of total revenues), which increased 25.3% on a year-over-year basis, reflecting continued expansion across spares, upgrades and services. The Zacks Consensus Estimate for Customer Support Business Group revenues was pegged at $1.93 billion.During the quarter, China contributed 34% of total revenues, Taiwan 23%, and Korea 23%. Other regions like Japan contributed 8%, the United States 6%, Southeast Asia 4%, and Europe 2%.Lam Profitability Improves on Mix and Factory EfficienciesLam Research posted fiscal third-quarter non-GAAP gross margin of 49.9%, improving 20 basis points from 49.7% in the previous quarter. Management attributed performance to a favorable customer and product mix as well as improved factory efficiencies, supported by prior work to enhance the global manufacturing footprint.Non-GAAP operating expenses were $866 million in the fiscal third quarter, up from $827 million in the prior quarter, driven by seasonal employee-related costs and higher headcount to support growth.Even with higher spending, non-GAAP operating margin expanded 70 basis points to 35.0%, up from 34.3% in the previous quarter.LRCX’s Balance Sheet & Cash FlowAs of March 29, 2026, Lam Research held $4.8 billion in cash and cash equivalents, down from $6.2 billion at the end of the prior quarter.Cash flows from operating activities decreased to $1.14 billion, down from $1.48 billion in the previous quarter.During the quarter, Lam Research paid dividends totaling $325.8 million and repurchased shares worth $796 million.LRCX Provides Strong Guidance for Q4 FY26For the fourth quarter of fiscal 2026, Lam Research expects revenues to be $6.60 billion (+/- $400 million). The Zacks Consensus Estimate for the fiscal fourth quarter is pegged at $6.08 billion, indicating year-over-year growth of 17.7%.The company forecasts non-GAAP gross margin of 50.5% (+/- 1%) and non-GAAP operating margin of 36.5% (+/- 1%).Lam Research guided non-GAAP earnings of $1.65 per share (+/- $0.15), based on a diluted share count of 1.26 billion. The Zacks Consensus Estimate for the fiscal fourth quarter is pegged at $1.44 per share, indicating year-over-year growth of 8.3%.Zacks Rank and Stocks to ConsiderCurrently, LRCX carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the broader Zacks Computer and Technology sector are Arista Networks ANET, Advanced Energy AEIS and Applied Materials AMAT, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Shares of Arista Networks have gained 35.6% year to date. The Zacks Consensus Estimate for ANET’s 2026 earnings is pegged at $3.54 per share, up by a penny over the past seven days, indicating an increase of 18.8% year over year.Shares of Advanced Energy have gained 80.2% year to date. The Zacks Consensus Estimate for AEIS’ 2026 earnings is pegged at $8.32 per share, up by 12 cents over the past 60 days, indicating a rise of 29.8% year over year.Applied Materials shares have surged 57% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $11.10 per share, down by a penny over the past 30 days, indicating an increase of 17.8% year over year.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.Free: See Our Top Stock And 4 Runners UpThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks