Snapshot
Lam Research generated $23.2 billion of revenue in FY2026, with gross profit of $11.7 billion, operating income of $8.2 billion and net income of $7.3 billion in FY2026. Diluted EPS was $5.76 in FY2026.
The latest reported fiscal quarter, Q4 FY2026, ended June 30, 2026. Revenue was $6.7 billion, gross profit was $3.5 billion, operating income was $2.5 billion and net income was $2.3 billion in Q4 FY2026. Diluted EPS was $1.81 in Q4 FY2026. Market capitalisation was $288.8 billion as of October 22, 2026.
Growth
Revenue reached $23.2 billion in FY2026 and increased 26.0% in FY2026 against FY2025. Revenue compound annual growth was 10.1% in FY2023–FY2026 and 9.70% in FY2021–FY2026.
Diluted EPS was $5.76 in FY2026, rising 38.8% in FY2026 against FY2025. Diluted EPS compound annual growth was 20.1% in FY2023–FY2026 and 16.4% in FY2021–FY2026. Free cash flow was $4.9 billion in FY2026 and declined −9.66% in FY2026 against FY2025; its compound annual growth was 1.50% in FY2023–FY2026 and 8.59% in FY2021–FY2026.
Revenue was $6.7 billion in Q4 FY2026, up 15.1% in Q4 FY2026 against Q3 FY2026. Diluted EPS was $1.81 in Q4 FY2026, up 24.8% in Q4 FY2026 against Q3 FY2026, while free cash flow was $1.3 billion in Q4 FY2026, up 56.6% in Q4 FY2026 against Q3 FY2026.
Profitability
Gross margin was 50.5% in FY2026, an increase of 3.9 percentage points in FY2021–FY2026 and 1.8 percentage points in FY2025–FY2026. Operating margin was 35.3% in FY2026, up 4.7 percentage points in FY2021–FY2026 and 3.3 percentage points in FY2025–FY2026.
Pre-tax margin was 35.6% in FY2026, increasing 5.7 percentage points in FY2021–FY2026. Net margin was 31.3% in FY2026, increasing 4.5 percentage points in FY2021–FY2026 and 2.2 percentage points in FY2025–FY2026.
Return on equity was 65.1%, return on assets was 32.4%, and return on invested capital was 48.2% in FY2026. Each return measure was higher in FY2026 than in FY2025.
Balance sheet
Total debt was $3.7 billion in FY2026, compared with $4.5 billion in FY2025. Cash and short-term investments were $5.6 billion in FY2026, compared with $6.4 billion in FY2025. Net debt was −$1.8 billion in FY2026, following −$1.9 billion in FY2025.
Shareholders’ equity was $12.5 billion in FY2026, up from $9.9 billion in FY2025, while book value per share was $9.94 in FY2026, up from $7.67 in FY2025. Working capital was $9.7 billion in FY2026, compared with $7.9 billion in FY2025.
The current ratio was 2.6× and debt to equity was 0.3× in Q4 FY2026.
Cash flow & capital return
Operating cash flow was $5.9 billion in FY2026, declining −5.11% in FY2026 against FY2025. Capital expenditure was $966.4 million in FY2026, compared with $759.2 million in FY2025. Free cash flow was $4.9 billion in FY2026, declining −9.66% in FY2026 against FY2025, and represented 67.3% of net income in FY2026.
Dividends paid were $1.3 billion and net share repurchases were $3.7 billion in FY2026. Capital returned to shareholders was $4.9 billion in FY2026 and $20.5 billion in FY2022–FY2026.
Weighted average shares were 1.3 billion shares in FY2026, unchanged from FY2025, while the share count changed −12.6% in FY2021–FY2026.
Valuation
As of October 22, 2026, P/E was 45.2×, higher than the five-year median of 23.3× and the ten-year median of 20.1×. As of October 22, 2026, P/E matched the industry median of 45.2×.
As of October 22, 2026, P/S was 14.1×, higher than the five-year median of 6.8×, the ten-year median of 4.8× and the industry median of 5.0×. As of October 22, 2026, P/B was 26.3×, higher than the five-year median of 12.7×, the ten-year median of 10.1× and the industry median of 3.4×.
As of October 22, 2026, EV/Sales was 14.1×, higher than the five-year median of 6.7×, the ten-year median of 4.8× and the industry median of 5.9×. As of October 22, 2026, EV/Cash flow was 66.8×, higher than the five-year median of 23.9× and the ten-year median of 23.3×.
What changed since last quarter
Revenue rose 15.1% in Q4 FY2026 against Q3 FY2026 and 30.0% in Q4 FY2026 against Q4 FY2025. Diluted EPS increased 24.8% in Q4 FY2026 against Q3 FY2026 and 34.1% in Q4 FY2026 against Q4 FY2025. Gross margin increased 1.9 percentage points in Q4 FY2026 against Q3 FY2026, while operating margin increased 2.3 percentage points over the same period.
Free cash flow increased 56.6% in Q4 FY2026 against Q3 FY2026 but declined −46.7% in Q4 FY2026 against Q4 FY2025. Management attributed revenue growth in the September 2026 quarter against the June 2026 quarter to strong customer demand from foundry and memory customers. Management attributed the September 2026 quarter gross-margin increase against the June 2026 quarter mainly to favorable customer and product mix, and cited incentive compensation and incremental headcount as drivers of higher operating expenses.
Open questions
- How much of recent demand is attributable to foundry customers versus memory customers?
- What factors drove free cash flow lower despite higher revenue and net income?
- How will increased headcount and incentive compensation affect operating expenses?
- How could trade restrictions and tariffs affect revenue and operating margin?
Sources
- Form 10-Q filed October 22, 2026 — management’s discussion and analysis