Chinese Chip Ban Could Wreck This Semiconductor Stock, But It Is Still Worth Buying
Lam Research (NASDAQ: LRCX) crushed Wall Street's expectations handsomely when it released its fiscal 2023 first-quarter results (for the three months ending Sept. 25, 2022) on Oct. 19, but there was something else that caught investors' attention.
Although Lam's near-term outlook is solid, the semiconductor equipment specialist points out that the curbs imposed by the U.S. government on the sales of chips to China could weigh heavily on the company's results in 2023. That's because the company relies on China for 30% of its business, and this is going to cost Lam between $2 billion and $2.5 billion in revenue in 2023. At the same time, the weak demand for memory chips will be another headwind for Lam next year.
But, surprisingly, Lam's stock is soaring following its earnings report, which indicates that investors remain upbeat about the company's prospects. Let's see why that may be the case.
Source Fool.com
