Q1 FY2027 results
| Metric | Result | Change |
|---|---|---|
| Revenue | $8.22 billion | up 54% year-over-year |
| EPS | $2.20 | record |
| Gross Margin | 52.4% | record |
| Operating Margin | 40.2% | record |
| Free Cash Flow | $3.24 billion | record |
Guidance and outlook
- Revenue of $8.6 billion, plus or minus $400 million.
- Gross margin of 52.5%, plus or minus 1 percentage point.
- Operating margin of 40.5%, plus or minus 1 percentage point.
- Earnings per share of $2.33, plus or minus $0.15.
How management sounded
Positive (+7 on our -10 to +10 scale). Management reported record revenue and margins while highlighting strong AI-driven demand and a positive outlook for 2027. Management sounded more upbeat than on 48% of the 190 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Q&A summary
Supply Constraints
Asked: How much are supply constraints costing in the December quarter?
Answer: Management noted revenue would have been higher without constraints and expects to ship that volume in the March quarter.
3D DRAM vs 4F Square
Asked: How does Lam position itself regarding the shift to 3D DRAM?
Answer: Management stated that as architectures go 3D, etch and deposition intensity rises, which benefits Lam.
China Revenue
Asked: How will China revenue trend in the December quarter?
Answer: China revenue is expected to be meaningfully down in the December quarter compared to the September quarter.
NAND Upgrades
Asked: What is the status of the NAND upgrade cycle?
Answer: The upgrade cycle is expected to finish in 2027, with customers already moving into 300 and 400 layer devices.
What to watch before the next call
- Clean room availability and supply chain constraints for 2027.
- The pace of NAND upgrade cycles and adoption of SLC storage tiers.
- The ramp of panel-level packaging market share.
