LAM RESEARCH CORP
For the period ended Mar 29, 2026. Filed Apr 23, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 29, 2026 · Filed Apr 23, 2026
LRCX$200.44+8.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-12-28; filed 2026-01-29.
0000707549-26-000009
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-29; filed 2026-04-23.
0000707549-26-000022
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 74 previous paragraphs and 78 current paragraphs.
46 unchanged; 24 reworded; 8 added; 4 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
The following table presents our revenues disaggregated by geographic region:
Current report
For a discussion on the March 2026 quarter compared to the December 2025 quarter, refer to “Executive Summary” above.
Current report
Systems revenue includes sales of new leading-edge equipment in deposition, etch, clean and other wafer fabrication markets.
Current report
Customer support-related revenue includes sales of customer service, spares, upgrades, and non-leading-edge equipment from the Company’s Reliant® product line.
Current report
Gross margin as a percentage of revenue increased in the March 2026 quarter compared to the December 2025 quarter, driven mainly by improved factory efficiencies.
Current report
The effective tax rate for the nine months ended March 29, 2026 compared to the same period in the prior year remained consistent.
Current report
During the three months ended March 29, 2026, $750.0 million principal value of our 2026 Notes were settled upon maturity using available cash on hand.
Current report
In March 2026, we increased the issuance capacity under our commercial paper program (the “CP Program”) from $1.50 billion to $2.00 billion. The net proceeds from the CP Program may be used for general corporate purposes, including repurchases of our Common Stock from time to time under our stock repurchase program. As of March 29, 2026, we had no outstanding borrowings under the CP Program.
Removed paragraphs (4)
Previous report
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Previous report
Please refer to Note 3, “Revenue,” to the Condensed Consolidated Financial Statements of this Form 10-Q for additional information regarding the composition of the two categories into which revenue has been disaggregated.
Previous report
Gross margin as a percentage of revenue decreasedin the December 2025 quarter compared to the September 2025 quarter driven primarily by unfavorable changes in customer mix.
Previous report
The increase in the effective tax rate for the six months ended December 28, 2025 compared to the same period in the prior year was primarily due to the income tax benefit from a change in tax law in the six months ended December 29, 2024, and the tax expense associated with the revaluation of deferred taxes due to changes in the U.S. taxation of non-U.S. income under OBBBA and GMT being fully effective in the six months ended December 28, 2025.
Reworded paragraphs (24)
Previous wording
With the exception of historical facts, the statements contained in this discussion are forward-looking statements, which are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Certain, but not all, of the forward-looking statements in this report are specifically identified as forward-looking, by use of phrases and words such as “believe,” “estimated,” “anticipate,” “expect,” “probable,” “intend,” “plan,” “aim,” “may,” “should,” “could,” “would,” “will,” “continue,” and other future-oriented terms. The identification of certain statements as “forward-looking” does not mean that other statements not specifically identified are not forward-looking. Forward-looking statements include, but are not limited to, statements that relate to: trends and opportunities in the global economic environment; trends and opportunities in the semiconductor industry, including in the end markets and applications for semiconductors, in device complexity, and in the complexity of device manufacturing; growth or decline in the industry and the market for, and spending on, wafer fabrication equipment; the anticipated levels of, and rates of change in, margins, market share, served available market, capital expenditures, research and development expenditures, international sales, revenue (actual and/or deferred), operating expenses and earnings generally; management’s plans and objectives for our current and future operations and business focus; restructuring activities; business process improvements and initiatives; volatility in our quarterly results; the makeup of our customer base; customer and end user requirements and our ability to satisfy those requirements; the performance and benefits of our products and services; customer spending and demand for our products and services, and the reliability of indicators of change in customer spending and demand; the effect of variability in our customers’ business plans or demand for our products and services; our competition, and our ability to defend our market share and to gain new market share; the success of joint development and collaboration relationships with customers, suppliers, or others; outsourced activities; our supply chain and the role of suppliers in our business, including the impacts of supply chain constraints and material costs; our leadership and competency, and our ability to facilitate innovation; our research and development programs; the opportunities in our industry for, and our ability to create sustainable differentiation; technology inflections in the industry and our ability to identify those inflections and to invest in research and development programs to meet them; our ability to deliver multi-product solutions; the resources invested to comply with evolving standards and the impact of such efforts; changes in state, federal and international tax laws, our estimated annual tax rate and the factors that affect our tax rates; legal and regula…
Excerpt shortened here; the source contains the full paragraph.
Current wording
With the exception of historical facts, the statements contained in this discussion are forward-looking statements, which are subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995. Certain, but not all, of the forward-looking statements in this report are specifically identified as forward-looking, by use of phrases and words such as “believe,” “estimated,” “anticipate,” “expect,” “probable,” “intend,” “plan,” “aim,” “may,” “should,” “could,” “would,” “will,” “continue,” and other future-oriented terms. The identification of certain statements as “forward-looking” does not mean that other statements not specifically identified are not forward-looking. Forward-looking statements include, but are not limited to, statements that relate to: trends and opportunities in the global economic environment; trends and opportunities in the semiconductor industry, including in the end markets and applications for semiconductors, in device complexity, and in the complexity of device manufacturing; growth or decline in the industry and the market for, and spending on, wafer fabrication equipment; the anticipated levels of, and rates of change in, margins, market share, served available market, capital expenditures, research and development expenditures, international sales, revenue (actual and/or deferred), operating expenses and earnings generally; management’s plans and objectives for our current and future operations and business focus; restructuring activities; business process improvements and initiatives; volatility in our quarterly results; the makeup of our customer base; customer and end user requirements and our ability to satisfy those requirements; the performance and benefits of our products and services; customer spending and demand for our products and services, and the reliability of indicators of change in customer spending and demand; the effect of variability in our customers’ business plans or demand for our products and services; our competition, and our ability to defend our market share and to gain new market share; the success of joint development and collaboration relationships with customers, suppliers, or others; outsourced activities; our supply chain and the role of suppliers in our business, including the impacts of supply chain constraints and material costs; our leadership and competency, and our ability to facilitate innovation; our research and development programs; the opportunities in our industry for, and our ability to create sustainable differentiation; technology inflections in the industry and our ability to identify those inflections and to invest in research and development programs to meet them; our ability to deliver multi-product solutions; the resources invested to comply with evolving standards and the impact of such efforts; changes in state, federal and international tax laws, our estimated annual tax rate and the factors that affect our tax rates; legal and regula…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
For a full understanding of our financial position and results of operations for the three and six months ended December 28, 2025, and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations below, you should also read the Condensed Consolidated Financial Statements and notes presented in this Form 10-Q and the financial statements and notes in our 2025 Form 10-K.
Current wording
For a full understanding of our financial position and results of operations for the three and nine months ended March 29, 2026, and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations below, you should also read the Condensed Consolidated Financial Statements and notes presented in this Form 10-Q and the financial statements and notes in our annual report on form 10-K for the year ended June 29, 2025 (our “2025 Form 10-K”).
Previous wording
Demand from cloud computing, artificial intelligence, 5G, the Internet of Things, and other markets is driving the need for increasingly powerful and cost-efficient semiconductors. At the same time, there are growing technical challenges with traditional two-dimensional scaling. These trends are driving significant inflections in semiconductor manufacturing, such as the increasing importance of vertical scaling strategies like three-dimensional architecture as well as multiple patterning to enable shrinks.
Current wording
Demand from cloud computing, artificial intelligence (“AI”), 5G, the Internet of Things, and other markets is driving the need for increasingly powerful and cost-efficient semiconductors. At the same time, there are growing technical challenges with traditional two-dimensional scaling. These trends are driving significant inflections in semiconductor manufacturing, such as the increasing importance of vertical scaling strategies like three-dimensional architecture as well as multiple patterning to enable shrinks.
Previous wording
Wafer fabrication equipment spending levels were strong in the 2025 calendar year driven by higher levels of semiconductor demand leading to an increase in both the memory and non-memory market segments. In the short term, volatility in the semiconductor industry environment from trade restrictions, tariffs, as well as other direct and indirect risks and uncertainties, have had, and in the future may have, a negative impact on our revenue and operating margin. Over the longer term, we believe that secular demand for semiconductors, combined with technology inflections in our industry, including 3D device scaling, multiple patterning, process flow, and advanced packaging chip integration, will drive sustainable growth and lead to an increase in the served available market for our products and services in the deposition, etch, and clean businesses.
Current wording
Wafer fabrication equipment investments were strong in the 2025 calendar year, and we believe there will be continued growth in 2026 with the AI market driving higher semiconductor industry spending across both the memory and non-memory market segments. In the short term, volatility in the semiconductor industry environment from trade restrictions, tariffs, as well as other direct and indirect risks and uncertainties discussed in Part II, Item 1A,“Risk Factors,” have had, and in the future may have, a negative impact on our revenue and operating margin. Over the longer term, we believe that secular demand for semiconductors, combined with technology inflections in our industry, including 3D device scaling, multiple patterning, process flow, and advanced packaging chip integration, will drive sustainable growth and lead to an increase in the served available market for our products and services in the deposition, etch, and clean businesses.
Previous wording
In the December 2025 quarter, revenue was up slightly compared to the three months ended September 28, 2025 (the “September 2025 quarter”), as increases in customer support-related revenue were largely offset by decreases in systems revenue due to timing of customer investments. The deferred revenue balance was $2.25 billion at the end of the December 2025 quarter, down relative to the balance at the end of the September 2025 quarter of $2.77 billion, due to a decrease in customer down payments.
Current wording
In the March 2026 quarter, revenue increased 9% compared to the three months ended December 28, 2025 (the “December 2025 quarter”), driven by an increase in systems revenue primarily resulting from increased customer investments in the DRAM market segment as well as an increase in customer support-related revenue mainly tied to our expanding installed base and higher spares, upgrades and services revenue, partially offset by decreased customer spend on non-leading-edge equipment. The deferred revenue balance was $2.22 billion at the end of the March 2026 quarter, down slightly relative to the balance at the end of the December 2025 quarter of $2.25 billion. The decrease in the deferred revenue balance included approximately $300 million of decreases in customer down payments that were largely offset by increases across other components of deferred revenue balance associated with growing business levels.
Previous wording
The decrease in gross margin as a percentage of revenue in the December 2025 quarter compared to the September 2025 quarter was primarily a result of unfavorable changes in customer mix. The operating expenses in the December 2025 quarter were relatively flat compared to the September 2025 quarter.
Current wording
The increase in gross margin as a percentage of revenue in the March 2026 quarter compared to the December 2025 quarter was primarily a result of improved factory efficiencies. The increase in operating expenses in the March 2026 quarter compared to the December 2025 quarter was primarily driven by an increase in employee-related costs as a result of beginning of calendar year seasonality and higher headcount, as well as higher costs associated with workforce optimization, partially offset by lower elective deferred compensation plan-related costs and decreased outside service spend.
Previous wording
Our cash, cash equivalents, and restricted cash balances decreased to $6.2 billion at the end of the December 2025 quarter compared to $6.7 billion at the end of the September 2025 quarter. This decrease was primarily the result of $1,466.2 million of share repurchases, including net share settlement of employee stock-based compensation and excise tax; $327.5 million of dividends paid to stockholders; and $260.9 million of capital expenditures, partially offset by $1,480.0 million of cash generated from operating activities. Employee headcount as of December 28, 2025 was approximately 19,700.
Current wording
Our cash, cash equivalents, and restricted cash balances decreased to $4.77 billion at the end of the March 2026 quarter compared to $6.20 billion at the end of the December 2025 quarter. This decrease was primarily the result of $1.16 billion of share repurchases, including net share settlement of employee stock-based compensation and excise tax; $751.2 million of principal payments on debt instruments and debt issuance costs; $331.6 million of capital expenditures; and $325.8 million of dividends paid to stockholders, partially offset by $1.14 billion of cash generated from operating activities. Employee headcount as of March 29, 2026 was approximately 20,600.
Previous wording
The increase in revenue in thesix months ended December 28, 2025 compared to the same period in the prior year was predominantly driven by increases in Foundry equipment spending by our customers, as well as higher customer support-related revenue.
Current wording
The increase in revenue in thenine months ended March 29, 2026 compared to the same period in the prior year was predominantly driven by increases in Foundry equipment spending by our customers, as well as higher customer support-related revenue mainly due to spares revenue.
Previous wording
The decrease in the foundry market segment for the December 2025 quarter compared to the September 2025 quarter was primarily driven by mature node investments, while the memory market segment saw strengthened DRAM investments offset by lower non-volatile memory spending.
Current wording
The decrease in the foundry market segment for the March 2026 quarter compared to the December 2025 quarter was primarily driven by lower mature node investments, while the memory market segment saw strengthened investments across both DRAM and non-volatile memory.
Previous wording
The increase ingross margin as a percentage of revenue in thesix months ended December 28, 2025 compared to the same period in the prior year was primarily due to favorable changes in customer mix, partially offset by reduced factory efficiencies from higher tariff-related spend.
Current wording
The increase ingross margin as a percentage of revenue in thenine months ended March 29, 2026 compared to the same period in the prior year was primarily due to favorable changes in customer mix, slightly offset by reduced factory efficiencies from higher tariff-related spend.
Previous wording
We continued to make significant R&D investments in the December 2025 quarter focused on leading-edge deposition, etch, clean and other semiconductor manufacturing processes. R&D expense in the December 2025 quarter was relatively flat compared to the September 2025 quarter.
Current wording
We continued to make significant R&D investments in the March 2026 quarter focused on leading-edge deposition, etch, clean and other semiconductor manufacturing processes. R&D expense in the March 2026 quarter increased compared to the December 2025 quarter primarily driven by employee-related spend as a result ofbeginning of calendar year seasonality and higher headcount as well as increased costs related to workforce optimization, partially offset by lower elective deferred compensation plan-related costs.
Previous wording
R&D expense in thesix months ended December 28, 2025 increased compared to the same period in the prior year, driven by higher employee-related costs as a result of increased headcount and increased spending on supplies.
Current wording
R&D expense in thenine months ended March 29, 2026 increased compared to the same period in the prior year, mainly tied to employee-related costs as a result of higher headcount, and increased supplies spending, and depreciation expense.
Previous wording
SG&A expense during the December 2025 quarter was relatively flat compared to the September 2025 quarter.
Current wording
SG&A expense during the March 2026 quarter increased compared to the December 2025 quarter driven by employee-related spend as a result ofbeginning of calendar year seasonality and higher headcount as well as costs related to workforce optimization, partially offset by lower outside service spending and elective deferred compensation plan-related costs.
Previous wording
SG&A expense in thesix months ended December 28, 2025 increased compared to the same period in the prior year, primarily as a result of higher employee-related costs due to increased headcount.
Current wording
SG&A expense in thenine months ended March 29, 2026 increased compared to the same period in the prior year, primarily as a result of employee-related costs due to higher headcount.
Previous wording
Interest income decreased in the December 2025 quarter compared to the September 2025 quarter, primarily due to lower cash balances and lower interest rates. Interest income decreased in the six months ended December 28, 2025 compared to the same period in the prior year, primarily due to lower interest rates, partially offset by higher cash balances.
Current wording
Interest income decreased in the March 2026 quarter compared to the December 2025 quarter, primarily due to lower cash balances and lower interest rates. Interest income decreased in the nine months ended March 29, 2026 compared to the same period in the prior year, primarily due to lower interest rates.
Previous wording
Interest expense was flat in the December 2025 quarter compared to the September 2025 quarter. Interest expense decreased in the six months ended December 28, 2025 compared to the same period in the prior year primarily due to the maturity of $500 million of the Company’s senior notes in March 2025.
Current wording
Interest expense decreased in the March 2026 quarter compared to the December 2025 quarter, primarily due to the maturity of $750.0 million of the Company’s senior notes in March 2026. Interest expense decreased in the nine months ended March 29, 2026 compared to the same period in the prior year primarily due to the maturity of $500.0 million of the Company’s senior notes in March 2025.
Previous wording
The gains on deferred compensation plan-related assets, net were driven by fluctuations in the fair market value of the underlying funds for all periods presented.
Current wording
The gains and losses on deferred compensation plan-related assets, net were driven by fluctuations in the fair market value of the underlying funds for all periods presented.
Previous wording
The variation in other, net in the December 2025 quarter and the six months ended December 28, 2025 compared to the September 2025 quarter and to the same period in the prior year was primarily driven by fluctuations in the fair market value of equity investments.
Current wording
The variation in other, net in the March 2026 quarter and the nine months ended March 29, 2026 compared to the December 2025 quarter and to the same nine-month period in the prior year was primarily driven by fluctuations in the fair market value of equity investments.
Previous wording
The decrease in the effective tax rate for the December 2025 quarter compared to the September 2025 quarter was primarily due to the revaluation of deferred taxes due to changes in the U.S. taxation of non-U.S. income under OBBBA in the September 2025 quarter.
Current wording
The decrease in the effective tax rate for the March 2026 quarter compared to the December 2025 quarter was primarily due to higher stock-based compensation excess tax benefits and the recognition of previously unrecognized tax benefits in the March 2026 quarter.
Previous wording
Total gross cash, cash equivalents, and restricted cash balances were $6.2 billion at December 28, 2025 compared to $6.4 billion as of June 29, 2025. The decrease was primarily driven by $2.44 billion of share repurchases, including net share settlement on employee stock-based compensation and excise tax; $619.5 million in dividends paid; and $446.0 million in capital expenditures, partially offset by cash generated from operating activities totaling $3.26 billion.
Current wording
Total gross cash, cash equivalents, and restricted cash balances were $4.77 billion at March 29, 2026 compared to $6.41 billion as of June 29, 2025. The decrease was primarily driven by $3.60 billion of share repurchases, including net share settlement on employee stock-based compensation and excise tax; $945.3 million in dividends paid; $777.6 million in capital expenditures, and $754.1 million of principal payments on debt instruments and debt issuance costs, partially offset by cash generated from operating activities totaling $4.40 billion.
Previous wording
Net cash provided by operating activities of $3.26 billion during the six months ended December 28, 2025 consisted of (in thousands):
Current wording
Net cash provided by operating activities of $4.40 billion during the nine months ended March 29, 2026 consisted of (in thousands):
Previous wording
Changes in operating asset and liability accounts, net of foreign exchange impact, included the following sources of cash: decreases in inventory of $211.8 million and prepaid expenses and other current assets of $118.5 million, and increases in accounts payable of $110.7 million. These sources of cash were offset by the following uses of cash: decreases in deferred gross profit of $400.8 million and accrued expenses and other liabilities of $103.5 million, and increases in accounts receivable of $116.0 million.
Current wording
Changes in operating asset and liability accounts, net of foreign exchange impact, included the following sources of cash: decreases in inventory of $224.2 million and prepaid expenses and other current assets of $136.0 million, and an increase in accounts payable of $223.8 million. These sources of cash were offset by the following uses of cash: an increase in accounts receivable of $756.2 million and decreases in accrued expenses and other liabilities of $407.5 million and deferred gross profit of $474.3 million.
Previous wording
Net cash used for investing activities during the six months ended December 28, 2025 was $443.8 million, primarily consisting of capital expenditures.
Current wording
Net cash used for investing activities during the nine months ended March 29, 2026 was $778.4 million, primarily consisting of capital expenditures for manufacturing capacity and lab infrastructure investments.
Previous wording
Net cash used for financing activities during the six months ended December 28, 2025 was $3.01 billion, primarily consisting of $2.44 billion in treasury stock repurchases, including net share settlement on employee stock-based compensation and excise tax and $619.5 million in dividends paid.
Current wording
Net cash used for financing activities during the nine months ended March 29, 2026 was $5.24 billion, primarily consisting of $3.60 billion in treasury stock repurchases, including net share settlement on employee stock-based compensation and excise tax, $945.3 million in dividends paid, and $754.1 million of principal payments on debt instruments and debt issuance costs.