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Lam Research (LRCX) to Report Q2 Earnings: What's in Store?

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Lam Research Corporation (LRCX - Free Report) is scheduled to report second-quarter fiscal 2023 results on Jan 25.

For the fiscal second quarter, LRCX expects revenues to be $5.1 billion (+/- $300 million). The Zacks Consensus Estimate for sales is pegged at $5.08 billion, indicating growth of 20.3% from the year-ago fiscal quarter’s reported value.

Lam Research anticipates non-GAAP earnings per share of $10 (+/- 75 cents) for second-quarter fiscal 2023. The consensus mark for earnings per share is pegged at $9.96, indicating a 16.8% rise from the previous-year fiscal quarter’s reported figure. Also, the consensus mark has been unchanged over the past 30 days.

LCRX’s bottom line surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed the same once, the average surprise being 7.4%.

Lam Research Corporation Price and EPS Surprise

Lam Research Corporation Price and EPS Surprise

Lam Research Corporation price-eps-surprise | Lam Research Corporation Quote

Key Factors to Note

Lam Research is likely to have gained from continued strong demand for semiconductor equipment in the fiscal second quarter. Rising demand for semiconductor devices owing to the growing adoption of artificial intelligence, 5G and the IoT technologies might have acted as a tailwind.

The growing usage of DRAM and NAND in consumer products is expected to have driven demand for wafer fab equipment during the quarter under review.

Continuous investment in expanding products and services is expected to have remained a tailwind in the underlined quarter.

Lam Research has been winning applications across etch and deposition for all device segments. This is likely to have continued aiding its quarterly performance.

Strong momentum for atomic layer deposition metals and dielectric solutions for leading-edge foundry/logic nodes in the deposition business might have supported the quarter under discussion.

Strength in the Reliant and Spares product lines is anticipated to have remained a positive for the quarter to be reported.

LRCX is witnessing large contract wins in the Customer Support Business Group. This is expected to have prevailed in the fiscal second quarter too.

Lam Research has been performing well in China, Korea and Taiwan so far. This is likely to have remained a positive. Also, growing investments in Korea, Malaysia and India might have aided the quarterly performance.

However, the U.S. government announced export regulations on semiconductor sale to China, which are is expected to have remained a major concern in the fiscal second quarter.

Lam Research has been experiencing a fall in memory shipments, which is likely to have affected the quarterly performance.

Supply-chain issues, inflationary pressure and output constraint are anticipated to have persisted in the quarter under review.

What Our Model Says

Our proven model predicts an earnings beat for Lam Research this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case in here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Lam Research has an Earnings ESP of +0.42% and a Zacks Rank #3 at present.

Other Stocks to Consider

Here are some other stocks worth considering as our model shows that these too have the right combination of elements to beat on earnings this season.

MSCI (MSCI - Free Report) has an Earnings ESP of +0.43% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

MSCI is scheduled to release fourth-quarter 2022 results on Jan 31. The Zacks Consensus Estimate for MSCI’s earnings is pegged at $2.71 per share, suggesting an increase of 7.97% from the prior-year quarter’s reported figure.

Endava (DAVA - Free Report) has an Earnings ESP of +1.97% and a Zacks Rank #3 at present.

Endava is set to report second-quarter fiscal 2023 results on Feb 15. The Zacks Consensus Estimate for DAVA’s earnings is pegged at 68 cents per share, suggesting an increase of 7.94% from the prior-year fiscal period’s reported figure.

Analog Devices (ADI - Free Report) has an Earnings ESP of +2.99% and a Zacks Rank of 3 at present.

Analog Devices is scheduled to release first-quarter fiscal 2023 results on Feb 15. The Zacks Consensus Estimate for ADI’s earnings is pegged at $2.59 per share, suggesting an increase of 33.5% from the prior-year fiscal quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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