Lam Research's FQ4 earnings seen soft amid component shortages, supply chain challenges
Lam Research (NASDAQ:LRCX) is scheduled to announce Q4 earnings results on Tuesday, July 26th, after market close.
The consensus EPS Estimate is $7.33 (-9.38% Y/Y) amid supply chain challenges, constant chip shortages and inflation induced softness and the consensus Revenue Estimate is $4.21B (+1.66% Y/Y).
Rising demand for semiconductor devices led by the growing adoption of artificial intelligence, 5G and the IoT technologies might have acted as a tailwind.
During the quarter, growing usage of DRAM and NAND in consumer products is likely to have pushed demand for wafer fab equipment.
Also, driving Q4 performance is the company winning applications across etch and deposition for all device segments; Customer Support Business Group is also winning large contract which is seen continuing in FQ4.
Over the last 2 years, LRCX has beaten EPS estimates 88% of the time and has beaten revenue estimates 63% of the time.
Over the last 3 months, EPS estimates have seen 3 upward revisions and 2 downward. Revenue estimates have seen 1 upward revision and 2 downward.
In its Q3 earnings, the company estimated Q4 revenue to be $4.2B, plus or minus $300M, compared to estimates of $4.45B. It also expects gross margin to be 44.5%, operating margins of 29.5% and EPS to be between $6.50 and $8 per share.
Ahead of its earnings, Morgan Stanley cut 2023 earnings estimates on Lam Research amid worries over cuts to semiconductor equipment spending.
Of the 28 Wall Street Analysts covering the stock, 12 assign it a Strong Buy rating while 12 rate it Hold; Quant rating stands at Buy since July 25, 2022 prior to which it stood at Hold.
YTD, the stock lost 37.9%; SA Contributor Tech Stock Pros recently wrote, "Lam Research: Close To Bottom; Buy Now".