Lam Research (NASDAQ: LRCX) Q2 2024 earnings: A strong showing featuring steady growth
1min read Semiconductor equipment manufacturer Lam Research, a pioneer in wafer fabrication technology, reported robust Q2 2024 earnings that exceeded analyst expectations.
The company's revenue soared by 20.7% year-over-year to $3.87 billion, beating analyst projections of $3.83 billion. This surge is attributed to solid execution and growth in its customer support business segment.
This quarter marked a turning point for Lam, as the company shifted from negative to positive revenue growth, indicating a potential end to the recent cyclical downturn.
Lam Research's adjusted operating income of $1.19 billion surpassed analyst estimates by 4.6%, translating to a non-GAAP earnings per share (EPS) of $8.14, an impressive 7.3% improvement over the same quarter last year.
President and CEO Tim Archer attributed this success to ongoing demand for advanced semiconductor manufacturing equipment in a rapidly growing industry.
For Q3 2024, Lam Research is forecasting revenue of $4.05 billion, in line with analysts' expectations, signaling a continuation of the growth trajectory. The gross margin expanded to 47.5%, up from 45.8% in the previous quarter, indicating improved production efficiency.
However, the company's free cash flow of $761.7 million decreased by 40.5% compared to the previous quarter, reflecting the capital-intensive nature of the semiconductor industry.
Despite this, the inventory days outstanding (DIO) of 189 days, although higher than the five-year average, indicates the company is managing inventory levels amidst a tight supply environment.
The market capitalization of $111.8 billion underscores Lam Research's position as a major player in the semiconductor equipment market.
While the stock price saw a post-earnings dip of 2.2% to $903, the solid Q2 performance and revenue guidance for the future indicate a company well-positioned to capitalize on the ongoing demand for advanced chip technology.
Lam Research's Q2 2024 earnings report showcased a strong quarter with both revenue and profit beats, validating the company's ability to navigate the semiconductor industry's cyclical nature.
As the industry continues to thrive on innovations like AI, 5G, and smart vehicles, Lam Research remains poised for growth, with management confident in a sustained upward trajectory. Investors should keep an eye on the company's ability to maintain momentum in the coming quarters and capitalize on potential market opportunities.