Lam Research stock rises after investor day event

Investing.com -- Shares of Lam Research Corp (NASDAQ:LRCX) climbed 1.7% as the company presented an optimistic financial model during its investor day, projecting significant revenue and earnings growth by 2028. The semiconductor company’s finance chief, Douglas Bettinger, forecasted revenues to range between $25 billion to $28 billion with adjusted earnings per share of $6 to $7. Additionally, he anticipated adjusted gross margins to hit approximately 50% by the same year.

The investor day event, which lasted around two and a half hours, marked the first such update from Lam Research in about five years. Company emphasized its strong positioning in the semiconductor industry, which is on track toward a $1 trillion market. Archer outlined strategic plans to outpace the industry in expanding serviceable addressable market (SAM), gaining share in technology inflections with top-tier products, and accelerating the growth of the Customer Support Business Group (CSBG) beyond the rate of the installed base.

Lam’s installed base has grown to about 96,000 chambers, a number that increases annually, contributing to the resilience of the CSBG revenues against industry cycles. Since 2013, CSBG revenues have only declined once despite multiple down cycles in wafer fabrication equipment (WFE), achieving a fivefold increase over the period. Looking ahead, Lam Research anticipates more than doubling its CSBG revenues in the expanding semiconductor market.

Innovation remains a key driver for Lam Research, as evidenced by the introduction of two new chip tools. The Altus Halo, the latest in atomic layer deposition technology, is designed to meet the intricate needs of molybdenum deposition, a critical element for advancing AI technologies. Furthermore, the company unveiled Akara, an etching tool that refines semiconductor wafer structures.

The positive response from investors reflects confidence in Lam Research’s strategic direction and its ability to capitalize on the growing semiconductor industry. While the company’s ambitious targets for 2028 are a significant leap from current figures, the detailed plans for product innovation and market expansion provided a clear roadmap for achieving these goals.

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