Lam Research Shares Fall Despite Record $8.22 Billion Revenue

Lam Research shares fell sharply in after-hours trading despite the semiconductor equipment maker reporting record revenue of $8.22 billion for the September 2026 quarter. Economic Times Markets reported on October 22 that shipment bottlenecks, an expected drop in China's revenue contribution and elevated expectations after a strong stock rally weighed on the reaction.

The report did not give the size of the share-price decline. Its account points to concerns about converting demand into near-term shipments, rather than a lack of orders, as a key constraint on the company's outlook.

AI and memory investment lift quarterly results

September-quarter revenue rose 54% from a year earlier and 22% from the preceding quarter, marking Lam Research's fifth successive quarter of record sales. Investment in AI infrastructure and advanced chip manufacturing supported the expansion.

Adjusted earnings per share reached $2.20, compared with market expectations of $2.18. Adjusted gross margin stood at 52.4%, while adjusted operating margin reached 40.2%, exceeding 40% for the first time.

Memory systems revenue increased 120% year-on-year as customers invested in high-bandwidth memory, DRAM and NAND technologies. NAND revenue alone grew about 40% sequentially, supported by spending on storage technologies with higher layer counts.

Shipment delays temper the December outlook

Lam Research forecast December-quarter revenue of $8.6 billion, with a possible variation of $400 million in either direction. That is a forecast, not a reported sales outcome.

Supply-chain constraints are pushing some shipments into the March quarter, limiting how much of the strong demand the company can fulfil in the nearer term. Those delays helped overshadow the September earnings beat in the reported market reaction.

China contribution expected to retreat

China accounted for 35% of September-quarter revenue, up from 26% in June. The concern is therefore an expected decline ahead—not a fall in China's share during the quarter just reported.

The company expects China's contribution to drop substantially in the December quarter, primarily because of weaker spending by domestic Chinese customers. Multinational customers with operations in China are expected to remain comparatively resilient.

Longer-term equipment spending outlook remains strong

Lam Research expects global wafer fabrication equipment spending to exceed $200 billion in 2027, against a projection in the mid-$150 billion range for 2026. These figures are company expectations for the wider equipment market, not Lam Research's own revenue.

The company sees demand continuing through 2028 as chipmakers add capacity for AI, memory and advanced computing. For now, the reported stock response reflects investors' focus on shipment execution and the changing customer mix alongside that longer-term opportunity.