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Earnings Results: Lam Research stock rises after beat-and-raise quarter, just like ASML

Lam Research Corp. rose in the extended session Wednesday, adding to gains in the regular session, after the chip-making-equipment supplier posted a beat-and-raise quarter, not unlike larger ASML Holding NV earlier in the day.

Lam Research  
LRCX,
+2.49%

shares rose 3% after hours, following a 2.5% gain to close the regular session at $330.08. ASML
ASML,
+6.27%

American depositary receipts rose 6.3% Wednesday, as the broader market lost ground.

The company reported fiscal first-quarter net income of $1.43 billion, or $10.39 a share, compared with $1.21 billion, or $8.74 a share, in the year-ago period. Adjusted earnings, which exclude amortization and other items, were $10.42 a share, compared with $8.83 a share in the year-ago quarter.

Revenue rose to a record $5.07 billion from $4.64 billion in the year-ago quarter. Analysts surveyed by FactSet had forecast adjusted earnings of $9.57 a share on revenue of $4.92 billion, based on Lam’s forecast of $8.75 to $10.25 a share on sales of $4.6 billion to $5.2 billion.

“Solid execution combined with easing supply chain conditions produced strong overall performance,” said Lam Research Chief Executive Tim Archer in a statement. “While we expect weaker wafer fabrication equipment spending in 2023, our technology leadership and demonstrated track record of managing through downturns provide us a strong foundation to capture the exciting opportunities ahead for the semiconductor industry.”

Lam forecast fiscal second-quarter adjusted earnings of $9.25 to $10.75 a share on sales of $4.8 billion to $5.4 billion. Analysts on average were projecting earnings of $9.09 a share on revenue of $4.81 billion for the the first quarter, according to FactSet.

Earlier Wednesday, Netherlands-based ASML posted a beat-and-raise quarter and CEO Peter Wennick told analysts that as supply-chain problems ease and become more predictable, he sees shipping rates increasing as the company is able to manufacture backlogged products. That boosted shares of Lam, as well as peers KLA Corp.
KLAC,
+1.19%

and Applied Materials Inc.
AMAT,
+2.70%

during Wednesday trading.

Lam, ASML, KLA, and Applied Materials all make the complicated machines needed to turn silicon into the wafers needed to manufacture chips.

Supply-chain issues have dogged the chip-making-equipment company, as well as the sector, since last year. KLA is scheduled to report earnings next Wednesday.

Lam Research shares have fallen 54% year to date, compared with a 44% drop in the PHLX Semiconductor Index 
SOX,
+0.76%
,
   a 23% decline by the S&P 500 index
SPX,
-0.67%
,
and a 32% fall in the tech-heavy Nasdaq Composite Index
COMP,
-8.76%

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