KLA (NASDAQ:KLAC) Releases Quarterly Earnings Results, Beats Estimates By $0.04 EPS

KLA (NASDAQ:KLAC) issued its quarterly earnings results on Wednesday. The semiconductor company reported $1.22 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.18 by $0.04, FiscalAI reports. KLA had a net margin of 36.25% and a return on equity of 89.30%. The business had revenue of $4.14 billion for the quarter, compared to the consensus estimate of $4.04 billion. During the same quarter in the prior year, the company earned $8.47 EPS. The firm’s quarterly revenue was up 28.9% on a year-over-year basis.

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 Stock Performance

Shares of NASDAQ:KLAC traded down $9.52 during trading on Friday, reaching $157.91. 22,412,649 shares of the stock were exchanged, compared to its average volume of 11,756,472. The stock has a 50-day moving average price of $178.62 and a 200-day moving average price of $181.78. The firm has a market cap of $205.75 billion, a PE ratio of 39.48, a PEG ratio of 1.31 and a beta of 1.49. KLA has a 12 month low of $107.20 and a 12 month high of $307.37. The company has a current ratio of 2.76, a quick ratio of 1.86 and a debt-to-equity ratio of 0.88.

KLA Increases Dividend

The business also recently disclosed a quarterly dividend, which was paid on Tuesday, September 1st. Stockholders of record on Monday, August 17th were issued a $0.23 dividend. This represents a $0.92 annualized dividend and a dividend yield of 0.6%. The ex-dividend date was Monday, August 17th. This is a positive change from KLA’s previous quarterly dividend of $0.23. KLA’s dividend payout ratio is 23.00%.

Key Stories Impacting KLA

Here are the key news stories impacting KLA this week:

• Positive Sentiment: KLA reported fiscal Q1 2027 revenue of approximately $4.14 billion and earnings of $1.22 per share, exceeding Wall Street expectations of $4.04 billion and $1.18 per share. Revenue increased 28.9% year over year, marking the company’s 10th consecutive quarter of growth. KLAC Q1 Earnings Beat Estimates
• Positive Sentiment: The company issued fiscal Q2 revenue guidance of $4.5 billion to $4.9 billion, implying roughly $4.7 billion at the midpoint versus consensus of $4.5 billion. EPS guidance of $1.33 to $1.55 also brackets or exceeds the $1.36 consensus estimate, reinforcing expectations for continued AI-driven demand. KLA Q2 Guidance
• Positive Sentiment: Demand for wafer inspection, process-control and advanced-packaging equipment is benefiting from the increasing complexity of AI chips and the construction of leading-edge semiconductor fabs. Argus reaffirmed its Buy rating with a $225 price target, while JPMorgan raised its target to $240 and maintained Overweight. Advanced Packaging Demand
• Neutral Sentiment: Analyst opinion remains mixed. Several firms lowered price targets after earnings—including Wells Fargo, Needham, Evercore ISI, Cantor Fitzgerald, Susquehanna and UBS—citing valuation, structural share headwinds or a more cautious risk-reward profile, even though many retained positive or neutral ratings.
• Negative Sentiment: KLAC is declining in sympathy with semiconductor shares as investors question whether elevated AI infrastructure spending can continue at its current pace. The pullback also leaves the stock below its 50-day and 200-day moving averages, increasing near-term technical pressure despite the strong operating outlook. KLA Shares Weaken as Semiconductor Stocks Fall

Wall Street Analysts Forecast Growth

A number of research analysts have recently issued reports on KLAC shares. Oppenheimer reaffirmed an “outperform” rating and issued a $260.00 price objective (up from $200.00) on shares of KLA in a research report on Thursday, July 16th. Weiss Ratings raised KLA from a “hold (c+)” rating to a “buy (b-)” rating in a research note on Friday, October 16th. The Goldman Sachs Group reaffirmed a “neutral” rating and issued a $230.00 price objective on shares of KLA in a report on Tuesday, July 28th. Piper Sandler set a $425.00 target price on shares of KLA in a report on Thursday. Finally, Wells Fargo & Company reduced their price objective on KLA from $245.00 to $210.00 and set an “overweight” rating for the company in a research note on Thursday. Nineteen investment analysts have rated the stock with a Buy rating and ten have given a Hold rating to the stock. Based on data from MarketBeat, the stock has an average rating of “Moderate Buy” and a consensus price target of $220.35.

Insider Buying and Selling

In related news, CEO Richard P. Wallace sold 72,019 shares of KLA stock in a transaction dated Tuesday, September 15th. The stock was sold at an average price of $171.88, for a total value of $12,378,625.72. Following the completion of the transaction, the chief executive officer owned 706,925 shares in the company, valued at approximately $121,506,269. This trade represents a 9.25% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. Also, EVP MaryBeth Wilkinson sold 13,802 shares of KLA stock in a transaction that occurred on Wednesday, August 5th. The stock was sold at an average price of $195.50, for a total transaction of $2,698,291.00. Following the completion of the sale, the executive vice president owned 22,110 shares of the company’s stock, valued at $4,322,505. This trade represents a 38.43% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last ninety days, insiders sold 243,339 shares of company stock valued at $46,903,454. 79.39% of the stock is owned by company insiders.

About KLA

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.