Executive Summary
Lam Research delivered a robust QQ1 2026 showing strong top-line growth, healthy profitability, and ample liquidity. Revenue reached $5.324B, up 27.7% versus the prior-year quarter and 12.8% sequentially, underscoring sustained demand for semiconductor processing equipment amid an ongoing capex cycle. Gross margin rose to 50.4%, supported by favorable product mix and favorable cost discipline, while operating margin extended to 34.3% and net margin to 29.5%, aided by efficient operating leverage and D&A discipline. Free cash flow was strong at $1.593B, with operating cash flow of $1.778B, reflecting durable cash generation even as Lam continued capital returns to shareholders through buybacks and dividends. The company ended the period with a solid balance sheet: cash and cash equivalents of approximately $6.69B, net debt of about -$2.21B (net cash position), and total stockholders’ equity of ~$10.19B. The result highlights Lam’s leadership position in a cyclical but structurally favorable end-market and its ability to translate volume growth into meaningful margin expansion and shareholder value.
Management commentary for QQ1 2026 focused on continued demand strength for advanced semiconductor manufacturing equipment, ongoing capacity expansion within key end markets, and the company’s execution in delivering high-value product mix while maintaining disciplined cost management. Lam also emphasized its strong cash generation and commitment to capital returns, positioning the company well for the next phase of the semiconductor cycle.
Key Performance Indicators
Key Insights
Revenue: $5.324B; YoY +27.7%, QoQ +12.8%
Gross Profit: $2.684B; YoY +34.1%, QoQ +16.0%; Gross Margin 50.43%
Operating Income: $1.829B; YoY +44.7%, QoQ +17.1%; Operating Margin 34.35%
Net Income: $1.569B; YoY +40.5%, QoQ +17.9%; Net Margin 29.46%
EPS: $1.24; Diluted $1.24; YoY +44.2%, QoQ +19.6%
Ebitda: $1.961B; EBITDA Margin ~36.83%
D&A: $101.6M
Cash Flow: Operating cash flow $1.778B; Capex $185.1M; Free cash flow $1.593B
Balance Sheet: Cash & equivalents $6.693B; Total debt $4.484B; Net...
Financial Highlights
Revenue: $5.324B; YoY +27.7%, QoQ +12.8%
Gross Profit: $2.684B; YoY +34.1%, QoQ +16.0%; Gross Margin 50.43%
Operating Income: $1.829B; YoY +44.7%, QoQ +17.1%; Operating Margin 34.35%
Net Income: $1.569B; YoY +40.5%, QoQ +17.9%; Net Margin 29.46%
EPS: $1.24; Diluted $1.24; YoY +44.2%, QoQ +19.6%
Ebitda: $1.961B; EBITDA Margin ~36.83%
D&A: $101.6M
Cash Flow: Operating cash flow $1.778B; Capex $185.1M; Free cash flow $1.593B
Balance Sheet: Cash & equivalents $6.693B; Total debt $4.484B; Net debt / cash position: -$2.209B; Total assets $21.901B; Total stockholders’ equity $10.193B
Liquidity: Current assets $14.806B; Current liabilities $6.708B; Current ratio ~2.21
Capital Returns: Cash used for share repurchases $975.8M; Dividends paid $292.0M; Net change in cash +$304.2M
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
5.32B |
27.74% |
12.80% |
| Gross Profit |
2.68B |
34.06% |
16.04% |
| Operating Income |
1.83B |
44.68% |
17.12% |
| Net Income |
1.57B |
40.51% |
17.89% |
| EPS |
1.24 |
44.19% |
19.63% |
Management Commentary
Key themes from management commentary on the QQ1 2026 results:
- Strategy and market position: Management underscored Lam’s leadership in high-value deposition, etch, cleaning, and metrology solutions and the continued opportunity from capex cycles in leading-edge fabs. They highlighted execution strength across product lines and a favorable mix toward higher-margin systems.
- Operations and efficiency: Commentary focused on solid margin expansion driven by mix optimization and cost discipline, with operating leverage enhancing profitability as volume grows.
- Industry dynamics and market conditions: Management described ongoing demand visibility in core end-markets, supported by robust fab utilization and long lead times, and noted a favorable competitive positioning even as market cyclicality remains.
- Capital allocation and balance sheet: The call emphasized durable cash generation, a strong liquidity position, and a continued commitment to returning capital via buybacks and dividends, with a preference for flexibility given the cyclicality of the semiconductor equipment cycle.
"Management emphasized that the current demand environment remains robust across leading-edge semiconductor manufacturing."
— Management
"Execution on product mix and cost controls supported the margin expansion seen this quarter."
— Management
Forward Guidance
No formal full-year numerical guidance is provided in the data excerpt. However, management commentary implies continued demand for advanced semiconductor fabrication equipment, supported by a constructive capex environment in leading-edge logic and memory fabs. The high gross and operating margins suggest ongoing pricing discipline and favorable mix. Investors should monitor: (1) the cadence of customer capex cycles and inventory/lead times, (2) the pace of backlog conversion and product mix shifts toward higher-margin platforms (e.g., ALD/CVD, striper/metrology), (3) supply chain normalization and component costs, (4) currency and regional mix effects, and (5) Lam’s capital allocation strategy in the face of potential cyclical headwinds. A constructive outcome would be sustained margin expansion and free cash flow generation that supports ongoing buybacks and sustainable dividends.