Lam Research shares are experiencing significant downward pressure in recent trading sessions. The semiconductor equipment manufacturer saw its stock decline by 3.30 percent in the latest session, adding to earlier November losses that included a 5.0 percent drop following analyst downgrades. Market concerns primarily center on the company’s substantial exposure to China and challenges within the NAND memory segment.
Strong Fundamentals Contrast With Market Sentiment
Despite the negative market reaction, Lam Research’s financial performance tells a different story. The company delivered impressive results for the first quarter of 2026, exceeding expectations across key metrics:
- Revenue: $5.32 billion
- Non-GAAP earnings per share: $1.26
- Non-GAAP operating margin: 35 percent
Looking ahead, management has provided guidance for the current December quarter projecting revenue between $5.20 billion and $5.50 billion, with earnings per share expected to range from $1.05 to $1.25. The ongoing demand for semiconductor equipment supporting artificial intelligence and high-bandwidth memory applications remains robust.
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Analyst Concerns Weigh on Investor Confidence
Market experts have raised alarms about several headwinds facing the company. Recent analyst downgrades have highlighted cooling growth patterns in China and the NAND memory market. Additional pressure comes from geopolitical uncertainties and their potential disruption to global supply chains for wafer fabrication equipment. The broader semiconductor sector weakness, as reflected in the Philadelphia SE Semiconductor Index’s performance, has further contributed to the downward trend in chip stocks.
China Exposure Remains Primary Risk Factor
The company’s significant dependence on the Chinese market represents a substantial vulnerability. With China accounting for 43 percent of Lam Research’s revenue in the September quarter, the company remains highly susceptible to shifting trade policies and political decisions. Analyst downgrades issued in September continue to impact investor sentiment, overshadowing the company’s strong fundamental performance.
After reaching a 52-week high of approximately $167.15 on November 10, Lam Research shares have entered a period of sideways trading characterized by notable volatility. As the semiconductor equipment sector remains under intense scrutiny, Lam Research finds itself at the center of investor attention amid these conflicting signals between operational excellence and market concerns.
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