Preview: Lam Research's Earnings

Lam Research LRCX announces its next round of earnings this Wednesday, April 21. Here is Benzinga's everything-that-matters guide for this Wednesday's Q3 earnings announcement.

Net Income, Earnings, And Earnings Per Share

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Lam Research earnings will be near $6.6 per share on sales of $3.69 billion, according to analysts. Lam Research reported a profit of $3.98 per share when it published results during the same quarter last year. Sales in that period totaled $2.50 billion.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

The Wall Street consensus estimate for earnings would represent a 65.83% increase for the company. Revenue would be up 47.36% from the year-ago period. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

Shares of Lam Research were trading at $621.73 as of April 19. Over the last 52-week period, shares are up 128.49%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Lam Research is scheduled to hold the call at 17:00:00 ET and can be accessed here.