(Reuters) - Semiconductor equipment manufacturer Lam Research Corp’s (LRCX.O) quarterly profit and revenue topped analysts’ forecasts, as chipmakers spent heavily on its machinery to make the most of booming demand for memory chips.
Fremont, California-based Lam’s shares, which soared 74 percent in 2017, gained 4 percent in after-hours trading on Wednesday.
Chipmakers have in recent years benefited from robust demand for memory chips, which are used in everything from smartphones and fitness trackers to everyday items including TVs and cars that increasingly connect to the internet.
“Shipments for new memory solutions, which have extremely demanding requirements, more than tripled for Lam in 2017,” Lam Chief Executive Martin Anstice said on a call with analysts.
Lam’s total shipments rose nearly 37 percent year-over-year in the quarter ended Dec. 24.
The memory category combined made up 77 percent of shipments, compared with 66 percent in the previous quarter.
“Within memory, the firm has really benefited from the shift from planar NAND to 3D NAND,” Morningstar analyst Abhinav Davuluri said.
Chips with 3D NAND technology are more efficient, helping lower the cost per gigabyte of storage and reduce power consumption. They are widely used in data centers.
Lam’s upbeat results come a day after chipmaker Texas Instruments’ (TXN.O) results showed signs of slowing revenue growth, which sent jitters in the chip sector and drove many stocks lower on Wednesday.
Xilinx Inc (XLNX.O), a manufacturer of programmable chips, also posted strong results on Wednesday, sending its shares up 5 percent.
Lam said it expects current-quarter revenue of $2.85 billion, give or take $125 million. Analysts on average were expecting $2.64 billion, according to Thomson Reuters I/B/E/S.
“In 2018 we expect record levels of customer equipment spending,” Anstice said in a statement.
Lam recorded a net loss of $10 million in the December-quarter, compared to a profit of $332.8 million in the year-ago quarter, hurt by a $757 million one-time charge related to new U.S. tax laws.
Excluding the charge and other items, Lam posted a profit of $4.34 per share, ahead of analysts’ average estimate of $3.68 per share.
Total revenue rose 37 percent to $2.58 billion and edged past analysts’ expectations of $2.57 billion.
Reporting by Munsif Vengattil in Bengaluru; editing by Sai Sachin Ravikumar