Executive Summary
Lam Research delivered a solid QQ2 2025 performance, underscoring its resilience in a cyclical semiconductor equipment market. Revenue of $4.376B rose 15.35% year over year (YoY) with gross margin of 47.37% and operating margin of 30.48%, leading to a net income of $1.191B and diluted EPS of $9.13. The quarter benefited from favorable product mix, robust demand for wafer fabrication equipment, and disciplined cost management. Cash flow remained a key strength, with operating cash flow of $742M and free cash flow of $554M, supporting a net cash position and continued capital return activity.
From a balance sheet perspective, Lam maintains a strong liquidity profile: cash and cash equivalents of $5.666B, total assets of $19.8399B, total liabilities of $11.0319B, and stockholders’ equity of $8.8080B. The company ended the quarter with a net debt position of approximately $683M in net cash terms and a mature capital structure (current ratio 2.54, cash ratio 1.06, debt-to-capitalization 0.361; interest coverage ~29.5x). Lam also executed meaningful shareholder returns, with roughly $697.9M in stock repurchases and $297.6M in dividends during the period.
Overall, QQ2 2025 reinforces Lam’s position as a leading WFE supplier with strong profitability, substantial cash generation, and a favorable balance sheet, albeit within a cyclical industry. Investors should monitor WFE demand drivers (foundry and memory capex cycles, AI/data center buildouts) and competitive dynamics as catalysts for the next leg of growth.
Key Performance Indicators
QoQ: -89.86% | YoY:26.02%
Key Insights
Revenue: $4,376,047,000; YoY +15.35%; QoQ +0.00%
Gross Profit: $2,072,981,000; Margin 47.37%; YoY +14.22%; QoQ +0.00%
Operating Income: $1,333,884,000; Margin 30.48%; YoY +22.65%; QoQ +0.00%
Net Income: $1,191,018,000; Margin 27.22%; YoY +23.32%; QoQ +0.00%
EPS (Diluted): $9.13; YoY +26.02%; QoQ -89.86%
Cash Flow: Net cash provided by operating activities $741,942,000; Capex $188,349,000; Free cash flow $553,593,000
Balance Sheet: Cash and cash equivalents $5,665,379,000; Total assets $19,839,91...
Financial Highlights
Revenue: $4,376,047,000; YoY +15.35%; QoQ +0.00%
Gross Profit: $2,072,981,000; Margin 47.37%; YoY +14.22%; QoQ +0.00%
Operating Income: $1,333,884,000; Margin 30.48%; YoY +22.65%; QoQ +0.00%
Net Income: $1,191,018,000; Margin 27.22%; YoY +23.32%; QoQ +0.00%
EPS (Diluted): $9.13; YoY +26.02%; QoQ -89.86%
Cash Flow: Net cash provided by operating activities $741,942,000; Capex $188,349,000; Free cash flow $553,593,000
Balance Sheet: Cash and cash equivalents $5,665,379,000; Total assets $19,839,916,000; Total liabilities $11,031,890,000; Stockholders’ equity $8,808,026,000; Net debt position around -$683,095,000
Liquidity/Leverage: Current ratio 2.54; Quick ratio ~1.73; Cash ratio 1.06; Debt-to-capitalization 0.361; Interest coverage ~29.45x
Valuation/Performance Metrics: P/E ~22.23x; Price-to-Book ~12.03x; Price-to-Sales ~24.21x; Dividend yield ~0.28%; Free cash flow yield not explicitly stated but FCF of $553.6M on $4.377B revenue implies ~12.6% FCF/revenue proxy this quarter; DSO ~68 days; DIO ~170 days; CCC ~206 days.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
4.38B |
15.35% |
0.00% |
| Gross Profit |
2.07B |
14.22% |
0.00% |
| Operating Income |
1.33B |
22.65% |
0.00% |
| Net Income |
1.19B |
23.32% |
0.00% |
| EPS |
9.17 |
26.02% |
-89.86% |
Key Financial Ratios
operatingProfitMargin
30.5%
operatingCashFlowPerShare
$0.01
freeCashFlowPerShare
$0.01
Management Commentary
Note: The earnings transcript for QQ2 2025 is not provided in the dataset. As a result, there are no management quotes or transcript themes to extract.
Forward Guidance
No explicit quarterly forward guidance is included in the provided data. Historically, Lam’s guidance is influenced by WFE market cycles, capacity additions by leading foundries and memory producers, and capex momentum from AI/data center deployments. Given the strong QoQ and YoY profitability in QQ2 2025, the near-term readthrough would depend on: (1) sustained WFE spend by leading customers, (2) mix shifts toward advanced process nodes and ALD/etch capabilities, (3) supply chain stability and component availability, and (4) price/margin discipline amid competitive dynamics. Risks include a potential memory cycle slowdown, macro volatility, and geopolitical/performance pressure on semiconductor capex. Key monitoring points for investors: quarterly order intake and backlogs (if disclosed), capacity utilization in major fabrication nodes, and any guidance updates from Lam or customers that signal a shift in capex cadence.