Records Close Out CY2025 at $20.6B Revenue; CY26 WFE Formally Guided at $135B (+28% YoY) — Maintaining Outperform on Positioning Reset
Key Takeaways
- Q2 FY2026 (Dec quarter) closed CY2025 with records across every line — Q2 revenue $5.34B (10th consecutive quarter of growth; above midpoint of $5.2B ± $300M guide), gross margin 49.7% (above high end of 48.5% guide), op margin 34.3% (above high end of 33% guide), non-GAAP EPS $1.27 (above $1.15 ± $0.10 guide; +$0.08 vs Street $1.19). CSBG hit a record $2.0B quarter (+12% QoQ; +14% YoY). CY2025 full-year records: revenue $20.6B (+27% YoY), CSBG $7.2B, gross margin 49.9% (highest combined-company since Novellus merger), op margin 34.1%, diluted EPS $4.89 (+49% YoY). SAM share of WFE reached mid-30%s (multi-year target).
- The structurally important new disclosure: CY2026 WFE formally guided to "$135 billion range" (+28% YoY from CY25 ~$110B). The CFO and CEO emphasized that the constraint is clean-room availability, not capex commitment ("industry seems to be sold out") — implying CY27 also remains constructive. CY26 expected to be H2-weighted (the affiliate-rule restricted China entities pulled out of H1 contributes to this), with robust growth across all three device segments led by DRAM and leading-edge foundry/logic.
- Mar Q (Q3 FY2026) guide of $5.7B ± $300M (+7% sequential) is the cleanest forward-acceleration signal of the print. Gross margin guide of 49% ± 1pp (down 70bps from Dec 49.7%) reflects China mix normalization. Op margin 34% ± 1pp and EPS $1.35 ± $0.10 indicate continued operating leverage. The acceleration confirms CY26 is a genuine growth year with H1 26 (Lam's calendar; Lam fiscal Q3 Mar + Q4 Jun) sequencing materially above CY25 H2 (~$10.5B implied).
- Mix continues to validate the structural improvement: Foundry 59% (vs 35% Dec 2024 = +24pp YoY) underscores leading-edge + China mature node positioning. DRAM hit a record 23% of systems revenue (vs 16% Q1) on HBM 3E/4 and 1B/1C node migrations. NAND at 11% (vs 18% Q1) on customer project timing. China region dropped to 35% (vs 43% Q1) reflecting affiliate-rule timing — moving toward the <30% CY26 target. Capital return remains aggressive: $1.4B buyback at avg $154/share + $328M dividends; CY25 returned 85% of FCF.
- Rating: Maintaining Outperform. The structural thesis is fully validated by the Q2 print + CY26 WFE $135B formal guidance + record CY25 financials. The near-term stock weakness (T+2 -5.9% reversal after T+1 +3.6%) reflects positioning crowdedness (+57% run from Q1 print) and the modest gap vs whisper-Street CY26 WFE of $140-145B — not a thesis break. Fair value $260-285 over 12 months (8-22% above Jan 29 close $248.17) on FY26 revenue of $24B+ and EPS of $6.20+. Position sizing 3-5% reflects high-conviction WFE bull case but tempered by the +57% pre-print run.
Results vs. Consensus
| Metric | Q2 FY26 Actual | Consensus / Guide | Beat/Miss |
|---|---|---|---|
| Total Revenue | $5.34B (record; 10th consecutive Q growth) | $5.34B Street / $5.2B ± $300M Guide | In-line; above midpoint |
| Non-GAAP Gross Margin | 49.7% | 48.5% Guide | +120bps above high end |
| Non-GAAP Op Margin | 34.3% | 33% Guide | +130bps above high end |
| Non-GAAP EPS | $1.27 | $1.19 Street / $1.15 ± $0.10 Guide | +$0.08 / +7% |
| CSBG Revenue (Q) | $2.0B (record) | ~$1.85B | +12% QoQ; +14% YoY |
| Foundry % of Systems | 59% | ~58% | vs 35% Dec 2024 = +24pp YoY |
| DRAM % of Systems | 23% (record) | ~18% | +700bps QoQ; HBM-driven |
| Tax Rate | 13.2% | ~14% | Slight favorable |
| Capex (Q) | $261M | ~$200M | Above (planned investment) |
| Buyback (Q) | $1.4B at avg $154/share | n/a | $5.1B authorization remaining |
| Cash & Equivalents | $6.2B | n/a | -$0.5B QoQ (capital return + capex) |
Full-Year CY2025 Records
| Metric | CY2025 | CY2024 | YoY |
|---|---|---|---|
| Revenue | $20.6B | $16.2B | +27% |
| CSBG Revenue | $7.2B | ~$6.4B | +13% |
| Gross Profit | $10.3B | $7.9B | +31% |
| Gross Margin | 49.9% (record post-Novellus FY) | ~48.5% | +140bps |
| Operating Profit | $7.0B | ~$5.0B | +41% |
| Operating Margin | 34.1% | ~30.7% | +340bps |
| Diluted EPS | $4.89 | $3.28 | +49% |
| SAM Share of WFE | Mid-30%s | ~31% | Multi-year target reached |
| Capital Return | 85% of FCF (~$5.0B) | ~80% | Met commitment |
| CSBG Installed Base | 100,000+ chambers (milestone) | ~95,000 | First time above 100K |
Quarter-over-Quarter Comparison
| Metric | Q2 FY26 (Dec) | Q1 FY26 (Sep) | QoQ |
|---|---|---|---|
| Total Revenue | $5.34B (record) | $5.32B | +0.4% |
| Non-GAAP Gross Margin | 49.7% | 50.6% | -90bps (China mix) |
| Non-GAAP Op Margin | 34.3% | 35.0% | -70bps |
| Non-GAAP EPS | $1.27 | $1.26 | +1% |
| Foundry % of Systems | 59% | 60% | -100bps |
| DRAM % of Systems | 23% (record) | 16% | +700bps (HBM) |
| NAND % of Systems | 11% | 18% | -700bps (timing) |
| China % of Total | 35% | 43% | -800bps (affiliate rule) |
| CSBG Revenue | $2.0B | $1.8B | +12% |
Revenue Assessment
Q2 revenue of $5.34B is the 10th consecutive quarter of growth — a multi-year demonstration of execution discipline. CY25 revenue of $20.6B (+27% YoY) materially outperformed CY25 WFE growth of ~10% (from ~$100B CY24 to ~$110B CY25) — the 2.5-3x outperformance ratio is empirically validated through the full year. The DRAM-led mix shift in Q2 (DRAM 23% record; HBM 3E/4 + 1B/1C migrations) demonstrates that the next leg of growth is memory-side, particularly HBM acceleration. Foundry held 59% (vs 60% Q1; structurally durable). NAND at 11% reflects customer project timing; the $40B 5-year upgrade thesis is intact.
The Mar Q (Q3 FY26) guide of $5.7B ± $300M is the cleanest sequential acceleration signal we've seen — +7% sequential growth. The CY26 WFE $135B framework + clean-room constraints + H2-26 weighted year all support continued sequential acceleration through the calendar year.
Margin Assessment
Q2 gross margin of 49.7% beat the 48.5% guide by 120bps. Sequential -90bps from Q1's 50.6% reflects China mix normalization — global multinationals had spiked the Q1 mix favorably; Q2 returned closer to the structural average. Mar Q guide of 49% ± 1pp implies continued China mix headwind partially offset by foundry-rich mix. We model FY26 gross margin at 49-50% range — well above the Q4 FY25 starting point.
Op margin at 34.3% sustains the high-30%s level achieved in Q1. The +130bps beat above the 33% guide reflects both gross margin beat AND OpEx discipline ($827M Dec vs $832M Sep — flat sequentially despite revenue growth). FY26 operating margin should sustain 33-35% range with potential upside as Mar Q revenue ramps +7% on essentially flat OpEx.
EPS & Cash Flow Assessment
Q2 EPS of $1.27 beat the $1.19 Street by $0.08. CY25 EPS of $4.89 (+49% YoY) reflects the combination of (a) +27% revenue growth, (b) +140bps gross margin expansion, (c) +340bps operating margin expansion, and (d) ~3% share count reduction from buybacks. The compounding lever (revenue + margin + share count) supports continued EPS growth through CY26.
Cash position declined $0.5B to $6.2B on $1.4B buyback ($154/share avg) + $328M dividends + $261M capex. The CFO disclosed potential cash repayment of the $750M March 2026 notes when they mature — meaningful balance-sheet management. CY25 returned 85% of FCF, meeting the long-stated commitment. $5.1B buyback authorization remaining provides multi-quarter cushion.
Segment Performance
| Segment / End Market | Q2 FY26 | QoQ | YoY (vs Dec 2024) |
|---|---|---|---|
| Foundry (% Systems) | 59% | -100bps | +24pp (vs 35% Dec '24) |
| NAND (% Systems) | 11% | -700bps | Lower (timing) |
| DRAM (% Systems) | 23% (record) | +700bps (HBM) | Higher |
| Logic/Other (% Systems) | 7% | +100bps | — |
| China Region | 35% | -800bps (affiliate rule) | — |
| Taiwan | 20% | +100bps | — |
| Korea | 20% | +500bps (memory timing) | — |
| CSBG (Customer Support) | $2.0B (record) | +12% | +14% |
DRAM — Record 23% of Systems on HBM Acceleration
DRAM hit a record 23% of systems revenue (vs 16% Q1) driven by HBM 3E and HBM 4 investments + traditional 1B/1C node migrations for DDR5. The CFO disclosed "investments in high bandwidth memory continued to remain strong, driven by movement to HBM 3E and 4." This validates the CY26 WFE framework where DRAM is one of two leading device segments driving growth.
The Akara conductor etch system has won at the 1C node and is set to ramp this year with expanding applications at the 1D node (3x more applications than 1C). Lam's Ether dry resist is already ramping in HBM HVM at a major memory manufacturer. Combined, the DRAM franchise has the strongest forward setup in the company's history.
Assessment: DRAM is the structural Q2 highlight. The 23% mix is durable as HBM 3E/4 transitions accelerate through CY26. We model DRAM at 22-26% of systems mix sustaining FY26.
Foundry — 59% of Systems; Multi-Year Structural Dominance
Foundry at 59% of systems (vs 35% Dec 2024 = +24pp YoY) reflects the structural mix transformation that the Q1 60% record kicked off. The drivers: leading-edge GAA at TSMC N2/A16, Samsung 2nm, Intel 18A; ALD moly multi-customer adoption; advanced packaging momentum; mature node spending in China.
The CEO disclosed quantitative frameworks: "$1 billion in incremental Lam SAM for every 100,000 wafer starts per month of GAA capacity"; advanced packaging now projected at "mid-single-digit percentage of overall foundry logic equipment spend" and "moving higher" as additional devices (mobile applications) adopt complex packaging.
Assessment: Foundry mix sustaining ~55-60% is the structural pillar. We model foundry contributing $11-13B of FY26 revenue.
NAND — 11% on Customer Project Timing; Demand Accelerating
NAND mix at 11% (vs 18% Q1) reflects timing of customer investment plans rather than structural softness. The CFO disclosed "as we enter 2026, we see solid end market demand as customers prepare for the next stage of AI driven growth in NAND." Combined with CSBG record upgrade revenue (CY25 upgrade revenue +90% YoY), the NAND franchise is structurally well-positioned.
NEW CEO framework: "For every two to three million accelerators sold, we estimate an incremental one-point increase in overall NAND bit demand growth." With multi-million-accelerator volumes from major hyperscalers, the NAND bit demand growth could materially exceed prior expectations.
Assessment: NAND will recover toward 15-20% of systems mix through FY26 as upgrade cycle compounds + AI inference NAND demand emerges. We model NAND at $4-5B FY26.
China — 35% on Affiliate Rule Normalization
China region declined to 35% (vs 43% Q1) reflecting the 50% Affiliate Rule timing impact. The CFO noted China was "slightly higher than our original expectations" given the affiliate rule timing. The CY26 China target of <30% is being approached. Mar Q guide implies further China mix normalization (gross margin headwind 70bps QoQ).
Assessment: China normalization is on track. The structural diversification toward <30% CY26 concentration is positive. We monitor for any further policy changes.
CSBG — Record $2.0B Quarter; +90% Upgrade Revenue YoY
CSBG hit a record $2.0B in Q2 (+12% QoQ; +14% YoY) driven by Reliant Systems + spares strength. The CFO disclosed two structural milestones: (1) the installed base "topped 100,000 chambers" for the first time; (2) NAND upgrade revenue grew "more than 90% year over year" in CY25. The 13-year track record: CSBG has grown every year except one since the Novellus merger.
Assessment: CSBG is the structural recurring-revenue floor + multi-year growth lever. We model CSBG at $7.8-8.2B FY26 (vs $7.2B CY25).
Key Topics & Management Commentary
Overall Management Tone: Management was confident and execution-focused with the formal CY26 WFE outlook ($135B) the most material new disclosure. The CEO opened by tying Q2 + CY25 records to the Investor Day commitment to "more than double Lam's revenue and profit over the next five years." Both Tim and Doug emphasized clean-room availability as the constraint rather than capex commitment — a structural framing that implies CY27 also remains constructive.
1. CY26 WFE Formally Guided at $135B (+28% YoY)
"The AI transformation is driving industry spending higher. In 2025, WFE came in close to $110 billion. Our initial 2026 view is for WFE to be in the $135 billion range. With the growth in spending remaining constrained by a shortage of available clean room space. Chipmakers have been public about their efforts to alleviate constraints, but they've also commented on sold-out conditions persisting, indicating the magnitude of the challenge. We expect WFE this year to be weighted to the second half with robust growth in investments across all three device segments, led by DRAM and leading-edge foundry logic." — Tim Archer, CEO
Assessment: CY26 WFE +28% YoY is constructive but slightly below the $140-145B whisper-Street had built. The clean-room constraint framing implies multi-year capacity-build cycle through CY27-CY28 — supportive of a structurally higher WFE trajectory than the historical 5-7% growth rate.
2. Advanced Packaging Expected to Grow >40% in CY26
"We expect our overall advanced packaging business to grow more than 40% in 2026, outperforming our view of WFE growth in this space." — Tim Archer, CEO
The structural framework: foundry-logic advanced packaging mid-single-digit% of WFE spend today, moving higher as mobile applications adopt complex packaging. SABER 3D plating + TSV etch leadership. Panel-level packaging investment (SABER 3D Callisto + 20 customers worldwide).
Assessment: +40% growth in advanced packaging on a $2.5-3B base = $1.0-1.2B incremental revenue. Material contributor to FY26 acceleration.
3. AI Inference NAND Framework — 2-3M Accelerators = 1pp NAND Bit Demand
"Non-volatile context memory layers enable large-scale AI inference have the potential to add incremental growth in NAND bit demand. For every two to three million accelerators sold, we estimate an incremental one-point increase in overall NAND bit demand growth." — Tim Archer, CEO
The quantitative framework links AI inference deployment to NAND bit demand. With multi-million-accelerator hyperscaler volumes accelerating, the NAND bit demand acceleration is structurally meaningful for the upgrade-cycle thesis.
Assessment: New structural NAND demand vector — accelerator-driven. Supportive of CY26-27 NAND upgrade cycle compounding.
4. Akara — Doubled Installed Base; Tool of Record at Multiple Nodes
"Aqara, our latest generation conductor etch system, has doubled its installed base over the past year. With production tool of record wins for EUV, and high aspect ratio etch applications, in advanced DRAM and foundry logic." — Tim Archer, CEO
Akara has won at the 1C node DRAM (ramping 2026) with expanded applications at 1D node (3x more applications). In next-gen GAA devices, Akara application count expected to grow ~2x including critical front-end silicon etch wins.
Assessment: Akara is the structural conductor-etch growth lever. Multi-node tool of record positioning + 2x application growth at next-gen GAA = multi-year revenue acceleration.
5. SAM Share of WFE in Mid-30%s — Multi-Year Target Reached
"In 2025, we achieved record revenues of more than $20 billion and expanded our served available market or SAM share of WFE into the mid-thirties percent range. This marks solid progress for our multiyear goal of being in the high thirties." — Tim Archer, CEO
Assessment: The mid-30%s SAM share milestone is the structural validation of the Investor Day framework. Path to high 30%s remains the multi-year north star.
6. Clean Room as Industry Constraint — CY27 Also Good
Repeatedly emphasized by both CEO and CFO: clean-room availability is the structural cap, not capex commitment. Industry "sold out" / "multiyear agreements" / "demand is very strong." Implies CY27 remains constructive even as CY26 ramps.
Assessment: The multi-year capacity-constraint framing extends the WFE growth window. CY27 setup likely $145-160B WFE.
7. R&D Acceleration — Velocity Labs + Digital Twin
The CEO disclosed R&D transformation: Velocity Labs (close to customers for materials/hardware/process screening); digital twin capabilities shortening product development cycles.
Assessment: The R&D velocity improvements support continued share gain on new technology inflections.
8. Capital Return Discipline — 85% FCF Return Met
CY25 buyback of ~39M shares at avg $104/share. Q2 buyback at avg $154/share. $5.1B remaining authorization.
Assessment: Capital return continues; balance sheet management (potential $750M March 2026 notes paydown) maintains flexibility.
Guidance & Outlook
| Metric | Mar Q (Q3 FY26) Guide | Implication |
|---|---|---|
| Total Revenue | $5.7B ± $300M (+7% sequential) | Strong sequential acceleration |
| Non-GAAP Gross Margin | 49% ± 1pp (-70bps QoQ) | China mix headwind |
| Non-GAAP Op Margin | 34% ± 1pp | Stable |
| Non-GAAP EPS | $1.35 ± $0.10 (+6% QoQ) | Operating leverage on revenue ramp |
| CY26 WFE | $135B (+28% YoY) | Formal disclosure; H2 weighted |
Implied FY26 Trajectory: Q3 FY26 $5.7B + Q4 FY26 implied ~$6.2-6.5B = ~$11.9-12.2B H2 FY26 (Lam's fiscal). Combined with H1 FY26 (Sep $5.32B + Dec $5.34B) = $10.66B H1, total FY26 revenue ~$22.5-23B (+22-25% YoY from FY25 $18.4B). FY26 non-GAAP EPS ~$5.80-6.20.
Analyst Q&A Highlights
WFE Constraint Magnitude — Clean Room Limitation Costing $15B?
Q: "Doug, I had a question about WFE this year. So you said we're gonna be constrained because of this fab, you know, readiness. Is it possible to say how much? I know you're guiding, you know, WFE to a 135 this year. I mean, if we use semiconductor revenue and you assume sort of a normal WFE in number, seems like could get to, like, a 150. So maybe the constraints are costing the industry, like, $15 billion. Is it possible to give a number in terms of how much the constraints are kind of costing in terms of, you know, WFE this year so we can kinda pro forma that out?"
— Tim Arcuri, UBS
A: "Tim, I knew somebody was gonna ask that question. I should have anticipated it was gonna be you. Listen. It's hard for us to put a number on it, and I'm gonna decline to do that as we sit here right now. And the reason, Tim, is plans are somewhat fluid, if we're honest. Meaning, people are trying to figure out how to get a little more clean room space, how to bring facilities online and bump things up a little bit. So I'm not we're not gonna put a number on it. But I think it's safe to say, and Tim can comment on this, as well. Yeah. I think it sets up for '27 to also be a pretty good year as we think through this. I mean, the industry seems to be sold out for most of what it's supplying."
— Doug Bettinger, CFO
Assessment: The $15B "constraint cost" framing implies CY26 WFE could have been $150B without clean-room limits. The CFO declined to quantify but acknowledged the dynamic. CY27 setup confirmed as "pretty good year" — supportive of multi-year compounding thesis.
Mar Q Gross Margin Down on China Mix
Q: "Then you're guiding gross margin down a bit on up revenue. Sounds like it's Yeah. Predominantly related to China. So China was thirty-five percent in December. Is it gonna come down? Like, is that the reason why the gross market is coming down? And if so, like, what mix do you think China will be for March?"
— Tim Arcuri, UBS
A: "Yeah. I'm not gonna give you a hard number, Tim. But, yes, it's customer mix. It's going to be less rich in the March quarter. And I'll also remind that this isn't the fixed cost business for us. So as volume goes up and down, component that just benefits from revenue growing isn't that big. The mix component of both product as well as customer is important item. So you're latched onto the right thing, Tim."
— Doug Bettinger, CFO
Assessment: Mar Q gross margin compression is China-mix-driven; structurally well-disclosed. We model FY26 gross margin at 49-50% range, with the China mix normalization being a 50-100bps headwind partially offset by foundry/HBM mix benefits.
What They're NOT Saying
- Clean-room constraint dollar quantification: "Can't put a number on it" — implied $15B+ but undisclosed.
- CY27 WFE specific framework: "Pretty good year" only.
- March Q China specific %: "Less rich" but no number.
- Advanced packaging $ contribution: +40% growth disclosed but base not sized.
- Akara revenue contribution: Multiple wins but no dollar contribution.
Market Reaction
- Pre-print (Jan 27): $238.46, +57% from Q1 print T+2. Crowded long positioning.
- Day-of (Jan 28): Close $239.58 (-0.7%).
- T+1 (Jan 29): Close $248.17 (+3.6%). Initial positive read.
- T+2 (Jan 30): Close $233.46 (-5.93%). Reversal on profit-taking + CY26 WFE $135B vs whisper $140-145B + China mix concern.
- Net cumulative print to T+2: -2.5% on 35M shares volume (highest 2-day of CY26).
- Sell-side: Mixed; mostly maintained ratings; some PT raises offset by some flags on CY26 WFE.
The pattern reflects the classic "buy the structural beat, sell into strength" with profit-taking dominating after the +57% pre-print run. The net -2.5% over 2 days does not indicate thesis break — the CY26 WFE +28% YoY and record CY25 financials confirm the structural narrative.
Street Perspective
Debate: Is CY26 WFE $135B the new ceiling or sandbag?
Bull view: CY26 H2 weighting + ongoing clean-room constraint relief + CY27 "pretty good year" = the $135B figure is an early-year baseline. As capacity expansions complete through 2026, the actual CY26 WFE could trend toward $140-145B.
Bear view: $135B vs whisper $145B = $10B miss is structural. Clean-room constraint as cap signals demand-side strength but supply-side execution limits.
Our take: The $135B is a credible starting estimate. The "robust growth" + H2 weighting + CY27 constructive sequence support modest upside to actuals. We model CY26 WFE at $138-142B.
Debate: Does the +57% pre-print run leave room for further upside?
Bull view: The thesis acceleration (CY26 WFE +28%, FY26 EPS $5.80-6.20+, multi-year SAM expansion) supports continued multi-quarter compounding. Fair value $260-285 = 8-22% above current.
Bear view: Stock at $234 vs $96 base 6 months ago = +144% in 2 quarters. Industrial-cyclical valuation multiples have re-rated meaningfully; further multiple expansion requires sustained beat-and-raise pattern.
Our take: Both partly right. We maintain Outperform with conservative position sizing.
Debate: Does the <30% CY26 China target reduce policy tail risk?
Bull view: The diversification reduces structural China policy concentration. Removes a key bear-case argument.
Bear view: The decline removes a high-revenue segment; if WFE softens in CY27, the diversification narrative loses force.
Our take: Net positive structurally.
Model Update Needed
| Item | Q1 FY26 Estimate | Post-Q2 Estimate |
|---|---|---|
| FY26 Revenue | $21.5-22B | $22.5-23B |
| FY26 Non-GAAP EPS | $5.40-5.80 | $5.80-6.20 |
| FY26 GM | 49.5-50% | 49-50% |
| CY26 WFE | $115-120B (pre-formal-guide) | $135B (mgmt) / $138-142B (our est) |
| FY27 Revenue | $24-25.5B | $25-27B |
Valuation impact: At Jan 29 close of $248.17 and ~1.26B diluted shares, market cap is ~$313B; net cash $1.2B; EV ~$312B. On FY26E revenue $22.7B and non-GAAP EPS $6.00, LRCX trades at 13.7x EV/Sales and 41x EV/EPS. Our 12-month fair-value estimate: $260-285 (5-15% above Jan 29 close).
Thesis Scorecard Post-Earnings
| Thesis Point | Status |
|---|---|
| Bull #1: SAM expansion to mid-30%s | ACHIEVED CY25 milestone |
| Bull #2: ALD moly + GAA leadership | Confirmed |
| Bull #3: Advanced packaging momentum | Confirmed; +40% CY26 growth guidance |
| Bull #4: NAND upgrade cycle | Confirmed; +90% YoY CY25 upgrade revenue |
| Bull #5: HBM-driven DRAM growth | Record 23% systems mix Q2 |
| Bull #6: CY26 growth year | Formal $135B guide |
| Bull #7: CSBG installed base 100K+ chambers | Milestone reached |
| Bear #1: China policy | Managed; trending toward <30% CY26 |
| Bear #2: Clean room constraint caps growth | Open; "sold out" framing |
| Bear #3: Crowded long positioning | Confirmed (Q2 T+2 reversal) |
Action: Maintaining Outperform. The structural thesis is fully validated. Position sizing 3-5% reflecting high conviction but tempered by the +57% pre-print run. Re-rate higher on continued Mar Q execution + CY26 actuals tracking above $135B framework.