Lam Research (NASDAQ:LRCX) CEO Tim Archer announced a projected wafer fabrication equipment (WFE) spending of approximately $140 billion driven by AI demand, which is reshaping the semiconductor equipment market. Speaking at a Bernstein conference, Archer noted that the AI boom has intensified requirements for memory, storage, and high-performance computing across various sectors.
Archer highlighted a significant shift in Lam’s business focus, stating that about 60% of its revenue now comes from foundry logic, compared to 60% from memory five years ago. The company aims to complete a multiyear $40 billion upgrade cycle in NAND technology by the end of 2027, accelerated by strong AI-related demand. Additionally, revenue from advanced packaging is expected to increase more than 50% this year, reaching around $2 billion.
Investments in manufacturing and operational improvements have led to enhanced gross margins, which now exceed 50%. Archer mentioned ongoing challenges, such as clean room availability, which could impact equipment shipping. Despite setbacks in China, Lam continues to focus on AI-driven growth, with a significant portion of its business dedicated to service, operating around 100,000 chambers.
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