Lam Research Beats on Both Top and Bottom Lines

Lam Research (Nasdaq: LRCX  ) reported earnings on Wednesday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 25 (Q3), Lam Research beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue contracted significantly, and GAAP earnings per share contracted significantly.

Margins shrank across the board.

Revenue details
Lam Research recorded revenue of $659 million. The 14 analysts polled by S&P Capital IQ hoped for sales of $643.1 million on the same basis. GAAP reported sales were 19% lower than the prior-year quarter's $809.1 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.50. The 17 earnings estimates compiled by S&P Capital IQ predicted $0.46 per share on the same basis. GAAP EPS of $0.38 for Q3 were 74% lower than the prior-year quarter's $1.45 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 40.5%, 570 basis points worse than the prior-year quarter. Operating margin was 8.8%, 1,550 basis points worse than the prior-year quarter. Net margin was 6.9%, 1,560 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $708.4 million. On the bottom line, the average EPS estimate is $0.71.

Next year's average estimate for revenue is $2.63 billion. The average EPS estimate is $2.19.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 339 members rating the stock outperform, and 27 members rating it underperform. Among 117 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 111 give Lam Research a green thumbs-up, and six give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Lam Research is outperform, with an average price target of $49.24.

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