KLA (NASDAQ:KLAC) Issues Quarterly Earnings Results

KLA (NASDAQ:KLAC) released its earnings results on Wednesday. The semiconductor company reported $1.22 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $1.18 by $0.04, FiscalAI reports. The company had revenue of $4.14 billion during the quarter, compared to analyst estimates of $4.04 billion. KLA had a return on equity of 91.73% and a net margin of 36.25%. The company’s revenue for the quarter was up 28.9% on a year-over-year basis. During the same quarter in the prior year, the company earned $8.47 earnings per share.

Here are the key takeaways from KLA’s conference call:

• Record September-quarter revenue of $4.14 billion rose 13% sequentially and 29% year over year, while operating margin reached a company-record 46.1% and free cash flow was $1.34 billion.
• KLA guided to approximately $4.7 billion of December-quarter revenue and expects the wafer equipment market to reach roughly $150 billion in 2026 and exceed $200 billion in 2027, supported by AI infrastructure, leading-edge logic, DRAM/HBM, and advanced packaging.
• Backlog and sales-funnel visibility are strengthening, with management expecting sequential growth through 2027 and believing KLA can outgrow the overall wafer equipment market as process-control intensity rises at newer nodes and in advanced packaging.
• Persistent memory-cost inflation is pressuring gross margins, which are guided to 62.5% in December; management expects improvement only gradually as new pricing takes effect and systems are redesigned to use memory more efficiently.
• KLA is increasing capital expenditures, hiring, factory capacity, and supplier investments to support the multiyear cycle, while noting that customer clean-room construction, power availability, and other infrastructure constraints could limit industry growth.

KLA Price Performance

Shares of NASDAQ:KLAC opened at $167.43 on Friday. The firm has a market cap of $218.50 billion, a price-to-earnings ratio of 38.77, a P/E/G ratio of 1.41 and a beta of 1.45. KLA has a 1 year low of $107.20 and a 1 year high of $307.37. The company has a current ratio of 2.88, a quick ratio of 2.03 and a debt-to-equity ratio of 0.93. The business has a fifty day simple moving average of $179.18 and a 200 day simple moving average of $181.70.

KLA Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Tuesday, September 1st. Investors of record on Monday, August 17th were issued a dividend of $0.23 per share. This is a positive change from KLA’s previous quarterly dividend of $0.23. This represents a $0.92 annualized dividend and a dividend yield of 0.5%. The ex-dividend date was Monday, August 17th. KLA’s dividend payout ratio is 25.07%.

Key KLA News

Here are the key news stories impacting KLA this week:

• Positive Sentiment: KLA reported fiscal Q1 2027 revenue of $4.14 billion, above the $4.04 billion consensus estimate, while non-GAAP EPS of $1.22 exceeded expectations of $1.18. Revenue grew 28.9% year over year, supported by demand for wafer-inspection and process-control equipment. KLA Corporation Reports Fiscal 2027 First Quarter Results
• Positive Sentiment: Management forecast fiscal Q2 revenue of approximately $4.7 billion, within a $4.5 billion-$4.9 billion range and above Wall Street expectations. Investors viewed the guidance as evidence that AI-related capital spending is translating into sustained demand for KLA’s equipment. KLA forecasts December-quarter revenue and wafer equipment outlook
• Positive Sentiment: KLA also generated $1.34 billion in quarterly free cash flow and returned $1.24 billion to shareholders, reinforcing its financial strength and capital-return profile.
• Positive Sentiment: JPMorgan raised its price target to $240 from $238 and maintained an Overweight rating. Citigroup retained a Buy rating despite reducing its target to $275. JPMorgan adjusts price target on KLA
• Neutral Sentiment: The broader semiconductor-equipment group has benefited from expectations of prolonged memory shortages and years of additional fab construction, providing a favorable industry backdrop for KLA.
• Negative Sentiment: Several analysts cut price targets following the earnings release, including Wells Fargo to $210, Needham to $200, Evercore ISI to $185, Susquehanna to $190, UBS to $180 and Cantor Fitzgerald to $225. UBS maintained a Hold rating, while Susquehanna retained Neutral, signaling valuation and longer-term share-related concerns despite the strong near-term outlook. KLA analysts cut forecasts following Q1 earnings

Insider Transactions at KLA

In other KLA news, EVP MaryBeth Wilkinson sold 13,802 shares of the company’s stock in a transaction dated Wednesday, August 5th. The stock was sold at an average price of $195.50, for a total value of $2,698,291.00. Following the transaction, the executive vice president directly owned 22,110 shares of the company’s stock, valued at $4,322,505. This represents a 38.43% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CAO Virendra A. Kirloskar sold 4,504 shares of the firm’s stock in a transaction dated Wednesday, August 5th. The stock was sold at an average price of $195.50, for a total value of $880,532.00. Following the sale, the chief accounting officer directly owned 7,972 shares of the company’s stock, valued at $1,558,526. This trade represents a 36.10% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last three months, insiders have sold 243,339 shares of company stock worth $46,903,454. 79.39% of the stock is owned by company insiders.

Wall Street Analysts Forecast Growth

Several research firms recently weighed in on KLAC. Oppenheimer reissued an “outperform” rating and set a $260.00 price target (up from $200.00) on shares of KLA in a research report on Thursday, July 16th. BMO Capital Markets set a $133.00 price objective on KLA in a research report on Thursday. UBS Group restated a “neutral” rating and set a $180.00 price objective (down from $190.00) on shares of KLA in a research report on Thursday. Sanford C. Bernstein reaffirmed an “outperform” rating and set a $225.00 target price on shares of KLA in a research note on Wednesday, July 29th. Finally, Susquehanna dropped their target price on KLA from $215.00 to $190.00 and set a “neutral” rating on the stock in a report on Thursday. Nineteen equities research analysts have rated the stock with a Buy rating and ten have assigned a Hold rating to the company. According to data from MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus target price of $219.35.

KLA Company Profile

KLA Corporation (NASDAQ: KLAC) develops process control, inspection and yield management solutions for the semiconductor and other advanced manufacturing industries. Its technologies help manufacturers identify defects, measure critical dimensions and monitor production processes to improve quality, reliability and manufacturing efficiency.

The company’s product portfolio includes wafer and reticle inspection systems, metrology and measurement tools, defect review and classification systems, and software for analyzing manufacturing data.