Lam Research designs and manufactures plasma etch and deposition equipment, two of the most critical and repeated process steps in semiconductor fabrication. Etch tools selectively remove material to define features; deposition tools add material to build up the layers that form transistors, interconnects, and memory cells. Virtually every chip manufactured today passes through Lam Research equipment multiple times during production.

The AI-driven surge in HBM memory production has been a significant driver of Lam's growth. HBM uses 3D stacking technology that requires extremely precise and repeated etch and deposition steps to build each memory layer, and Lam's equipment is used extensively in this process. SK Hynix, Micron, and Samsung—the three HBM manufacturers—have all increased capital equipment spending substantially to expand HBM production capacity. Advanced logic chips for AI GPUs also require Lam equipment at multiple steps, including the complex multi-patterning processes used to define transistors at 3nm.

Lam's non-China revenue grew approximately 40% YoY in 2025, driven by record orders from TSMC, SK Hynix, and Micron for AI chip and memory capacity expansion. The company has invested in advanced etch and atomic layer deposition capabilities required for next-generation AI chip manufacturing, including processes needed for gate-all-around transistors at 2nm and increasingly complex memory cell structures in next-generation HBM.