Lam Research Posts Record 52.4% Gross Margin in September Quarter
Key Facts
Lam Research posted a record non-GAAP gross margin of 52.4% for the quarter ended September 27, 2026, up 40 basis points from 52.0% in the June quarter, according to results announced by the company. GAAP gross margin rose to 52.3% from 51.7% in the prior quarter. The company attributed the improvement primarily to a favorable customer and product mix. CEO Tim Archer said rising semiconductor demand and the increasing complexity of devices associated with AI helped the company achieve record revenue, earnings and earnings per share during the quarter. The results reflect an expansion in profitability from the prior quarter, alongside higher systems revenue.
Non-GAAP net income was $2.77 billion, and diluted earnings per share were $2.20, compared with $1.82 in the June quarter. On a GAAP basis, net income rose to $2.75 billion from $2.28 billion, and diluted earnings per share increased to $2.19 from $1.81. The quarterly comparison shows improvement in profit and earnings per share under both measures, alongside the increase in margin. Archer linked the results to rising semiconductor demand and greater device complexity, as well as the company’s focus on operational execution. He said those factors helped Lam achieve "record revenue, earnings and earnings per share" in the September quarter.
Growth in systems revenue led the operational improvement: it was $5.733 billion in the September quarter, compared with $4.250 billion in the June quarter. Meanwhile, customer support and other revenue increased to $2.487 billion from $2.472 billion. The difference highlights that the largest quarterly increase came from systems revenue, while support and other services revenue remained close to its previous level. Archer said AI is increasing semiconductor demand and adding to device complexity, two factors he cited in the context of the record results. He added that the company’s investments in technology and manufacturing capacity strengthen its ability to grow as the industry expands.
September-quarter revenue was distributed across major Asian markets, with China accounting for 35% of total revenue, Korea 20% and Taiwan 18%, according to company data. At quarter-end, cash, cash equivalents and restricted cash rose to $7.45 billion from $5.60 billion at the end of the June quarter. Lam attributed the increase in cash primarily to cash generated from operations, after accounting for capital returns and capital expenditures. Deferred revenue also rose to $2.66 billion at the end of September, compared with $2.43 billion at the end of June. These figures add to the picture of the company’s cash position and deferred revenue alongside sales growth and improved quarterly profitability.
For the quarter ending December 27, 2026, the company expects revenue of $8.60 billion, plus or minus $400 million, and a non-GAAP gross margin of 52.5%, plus or minus one percentage point. The margin estimate is slightly above the 52.4% recorded in the September quarter, though the guidance range allows for results above or below its midpoint. The company said on its earnings call that revenue guidance would have been "slightly higher" but for near-term supply-chain constraints. Lam Research set its revenue and margin outlook for the next quarter while noting that supply constraints limited its sales estimate. EL7 data showed the company’s stock, listed under the ticker LRCX, closed at $221.31 on November 9, 2026.