Lam Research predicts high quarterly revenue due to AI growth

Lam Research predicts high quarterly revenue due to AI growth

Lam Research Forecasts Strong Quarterly Revenue as Demand Rises with AI Adoption

July 26 (Reuters) – Lam Research, a leading chip-making tools supplier, has forecasted quarterly revenue above Wall Street estimates. This surge in demand can be attributed to the rising adoption of artificial intelligence (AI) technology across various sectors. As a result, Lam’s shares rose about 2% in after-hours trading.

Businesses across different industries have been eager to incorporate AI capabilities after the remarkable performance of OpenAI’s ChatGPT. The chatbot technology from OpenAI has garnered significant attention from both consumers and investors. This increased focus on AI has generated substantial benefits for companies like Lam Research that play a crucial role in the chip supply chain.

Lam Research expects first-quarter revenue of $3.4 billion plus or minus $300 million, surpassing expectations of $3.3 billion according to IBES data from Refinitiv. This strong forecast demonstrates the promising growth prospects for the company and reflects the increasing demand for AI-powered technologies.

Lam Research, along with other key suppliers such as Applied Materials and ASML, provides wafer fabrication equipment (WFE), sophisticated and expensive machinery essential for semiconductor manufacturing. These companies are vital to the industry’s ability to keep up with the rising demand for AI-powered applications.

The AI boom has also helped chipmakers navigate the post-pandemic downturn in the demand for personal computers and smartphones. The increased integration of AI technology into various devices has revitalized the market and created new opportunities for growth.

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In terms of financial performance, Lam Research reported fourth-quarter revenue of $3.21 billion, which was lower compared to $4.64 billion last year. However, this figure still exceeded market expectations of $3.13 billion. On an adjusted basis, the company posted a profit of $5.97 per share, outpacing estimates of $5.07.

Overall, Lam Research’s optimistic forecast and positive financial results highlight the growing importance of AI in driving demand for semiconductor products. As technology continues to advance and AI becomes increasingly prevalent, suppliers like Lam Research are positioned to benefit from the thriving AI market. The surge in demand for chip-making tools is likely to continue as industries across the board embrace AI technologies to stay competitive and cater to evolving consumer needs.

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