Lam Research filed its 10-Q with the SEC, and its figures are now in our data. Revenue over the twelve months to Q1 2027 was $26.13 billion, which rose 33.4% on the year before. That growth rate was up 7.3 percentage points on the rate a quarter earlier.

What stands out

Net income rose 45.4% over the year while free cash flow rose 17.8%. Reported profit and cash are moving at different speeds.

Growth and profit

The trailing gross margin was 51.1%. The trailing operating margin was 37.0%, up 3.9 percentage points from a year earlier. The trailing net margin was 32.3%. Net income over the twelve months was $8.45 billion, which rose 45.4% on the year before.

Cash flow

Operating cash flow over the twelve months was $7.58 billion, up 18.7% on the year before. Capital spending was $1.04 billion, or 4.0% of revenue. Free cash flow, operating cash flow less capital spending, was $6.54 billion, up 17.8% on the year before. Free cash flow was 25.0% of revenue (the free-cash-flow margin), down 3.3 percentage points from a year earlier. The average diluted share count fell 1.9% over the year.

In context

Today’s free-cash-flow margin of 25.0% is higher than 77% of the company’s own past quarterly readings, which have ranged from 8.0% to 34.0%. Today’s operating margin of 37.0% is higher than 100% of the company’s own past quarterly readings, which have ranged from 1.9% to 35.3%. Today’s twelve-month revenue growth rate of 33.4% is higher than 82% of the company’s own past quarterly readings, which have ranged from −24.8% to 51.7%.

Guidance

The company gave its quarter ending December 27, 2026 guidance for Revenue: $8.6 billion. The company gave its quarter ending December 27, 2026 guidance for Gross margin: 52.5%. The company gave its quarter ending December 27, 2026 guidance for Operating margin: 40.5%. The company gave its quarter ending December 27, 2026 guidance for Net income per diluted share: $2.33.

What it means for value

In our model, growth 5 percentage points lower would lower the value by 23.5%, and 5 percentage points higher would raise it by 30.0%. A free-cash-flow margin 1 percentage point lower would lower it by 3.9%.

What to watch

The next filing will show whether the recent acceleration in revenue growth continues or moderates. It will also reveal if the gap between net income growth and free cash flow growth narrows or widens. Investors will see if the company maintains its current operating margin levels against the backdrop of its historical range.