3 Lam Research Analyst Takeaways On Upbeat Q1 Earnings, Guidance

Lam Research Corporation LRCX Wednesday reported a beat and raise quarter but warned of a revenue hit due to U.S. restrictions on China exports.

Needham On Lam Research

Analyst Quinn Bolton reiterated a Hold rating.

Lam Research delivered a beat across the board, driven by CSBG strength, while upside in the ongoing quarter is “likely due to shipments out of backlog and deferred revs,” Bolton said in a note.

"Lam guided the total China export control impact to be $2-$2.5bn for CY23, and the loss of this profitable China business will be a GM headwind,” the analyst mentioned. “Given Lam's exposure to memory and the forthcoming industry downturn, we maintain our Hold rating,” he added.

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KeyBanc Capital Markets On Lam Research

Analyst Steve Barger maintained a Sector Weight rating.

Investors are likely to “take little comfort” from Lam Research’s upbeat results and guidance, as it “indicated that 2023 WFE (wafer fabrication equipment) could fall in the low-$70B range, that LRCX would likely underperform the WFE decline given its memory exposure, and that 2023 would likely see a $2.0B-$2.5B impact from the China restrictions,” Barger wrote in a note.

“Given these dynamics, we expect run-rate revenue and EPS will trend toward ~$16B and $30, respectively,” he added.

Mizuho Securities On Lam Research

Analyst Vijay Rakesh reaffirmed a Buy rating and price target of $400.

Lam Research’s December quarter guidance was “MUCH better than feared given China concerns,” Rakesh said. “GMs were guided down ~150bps q/q due to a shift in customer mix as LRCX noted high-margin customers from China would be cut off due to the new WFE restrictions,” he added.

LRCX Price Action: Shares of Lam Research were trading 6.73% higher at $352.31 Thursday afternoon.