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Lam Research Corp. revealed a revenue decline and projected another for the current quarter Wednesday, as the semiconductor industry continues to deal with inventory issues.
Lam Research
LRCX,
reported fiscal third-quarter net income of $814 million, or $6.01 a share, compared with $7.30 a share, in the year-ago period. Adjusted earnings, which exclude amortization and other items, were $6.99 a share, compared with $7.40 a share in the year-ago quarter
Revenue fell to $3.87 billion from $4.06 billion in the year-ago quarter. Analysts surveyed by FactSet had forecast adjusted earnings of $6.52 a share on revenue of $3.82 billion, based on Lam’s forecast of $5.75 to $7.25 a share on sales of $3.5 billion to $4.1 billion.
Lam expects fiscal fourth-quarter adjusted earnings of $4.25 to $5.75 a share on sales of $2.8 billion to $3.4 billion, after producing revenue of $4.6 billion in the same quarter a year ago. Analysts on average were projecting earnings of $5.61 a share on revenue of $3.46 billion for the fourth quarter, according to FactSet.
“With lower wafer-fabrication equipment spending in 2023, we are focused on managing costs while making strategic investments for critical manufacturing inflections,” Lam Research Chief Executive Tim Archer said in Wednesday’s announcement.
The Fremont, Calif., chip-equipment supplier’s shares declined about 1% in after-hours trading, following a 0.9% decline to close the regular session at $491.02.
Last quarter, Lam cut its workforce by 7% while increasing R&D spending as a big drop in memory-chip demand dinged its outlook. Lam counts third-party chip maker TSMC
TSM,
and memory-chip maker Micron Technology Inc.
MU,
among its biggest customers, according to FactSet data; TSMC was due to report earnings just a few hours after Lam.
Earlier Wednesday, Netherlands-based ASML Holding NV
ASML,
reported a beat-and-raise quarter but shares came under pressure on a “mixed” end market outlook because of continued inventory drawdowns. ASML’s revenue nearly doubled from the previous year, while earnings per share nearly tripled.
Chip-equipment makers like Lam and ASML have faced pressure as pandemic-era supply shortages for semiconductors flipped to a glut, especially in areas such as memory chips. An inventory buildup has led to cutbacks in equipment purchases and other expenses.
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Lam Research shares have advanced 17% year to date, compared with a 20% rise in the PHLX Semiconductor Index
SOX,
an 8% rise by the S&P 500 index
SPX,
and a 16% gain in the tech-heavy Nasdaq Composite Index
COMP,
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