KLA (NASDAQ:KLAC) Announces Quarterly Earnings Results, Beats Expectations By $0.04 EPS

KLA (NASDAQ:KLAC) announced its quarterly earnings results on Wednesday. The semiconductor company reported $1.22 earnings per share for the quarter, beating analysts’ consensus estimates 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 firm had revenue of $4.14 billion during the quarter, compared to analysts’ expectations of $4.04 billion. During the same period in the previous year, the company earned $8.47 earnings per share. KLA’s quarterly revenue was up 28.9% compared to the same quarter last year.

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 Trading Down 5.7%

NASDAQ:KLAC opened at $157.91 on Friday. The firm has a market cap of $206.07 billion, a P/E ratio of 40.89, a PEG ratio of 1.45 and a beta of 1.45. The company has a current ratio of 2.76, a quick ratio of 2.03 and a debt-to-equity ratio of 0.88. The stock’s 50 day simple moving average is $178.62 and its 200-day simple moving average is $181.78. KLA has a 12-month low of $107.20 and a 12-month high of $307.37.

KLA Increases Dividend

The business also recently announced a quarterly dividend, which was paid on Tuesday, September 1st. Stockholders of record on Monday, August 17th were issued a $0.23 dividend. The ex-dividend date of this dividend was Monday, August 17th. This is an increase from KLA’s previous quarterly dividend of $0.23. This represents a $0.92 dividend on an annualized basis and a dividend yield of 0.6%. KLA’s dividend payout ratio is presently 25.07%.

Analyst Ratings Changes

A number of research analysts recently issued reports on the company. Citigroup dropped their price target on KLA from $290.00 to $275.00 and set a “buy” rating on the stock in a research note on Thursday. Deutsche Bank Aktiengesellschaft reiterated a “hold” rating and issued a $195.00 price objective (down from $220.00) on shares of KLA in a research note on Wednesday, July 29th. Sanford C. Bernstein reaffirmed an “outperform” rating and issued a $225.00 target price on shares of KLA in a report on Wednesday, July 29th. Truist Financial set a $225.00 price target on shares of KLA in a research report on Thursday. Finally, TD Cowen reiterated a “buy” rating and set a $260.00 price target (up from $200.00) on shares of KLA in a research note on Thursday, July 9th. Nineteen analysts have rated the stock with a Buy rating and ten have issued a Hold rating to the company’s stock. Based on data from MarketBeat, the company currently has a consensus rating of “Moderate Buy” and an average target price of $220.35.

KLA News Summary

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

Insider Buying and Selling

In related news, CEO Richard Wallace sold 72,019 shares of the stock in a transaction on Tuesday, September 15th. The stock was sold at an average price of $171.88, for a total transaction of $12,378,625.72. Following the completion of the sale, the chief executive officer directly owned 706,925 shares of the company’s stock, valued at $121,506,269. This trade represents a 9.25% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, EVP Brian Lorig sold 59,586 shares of KLA stock in a transaction on Thursday, August 13th. The shares were sold at an average price of $208.13, for a total transaction of $12,401,634.18. Following the completion of the transaction, the executive vice president owned 77,681 shares in the company, valued at approximately $16,167,746.53. This trade represents a 43.41% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 243,339 shares of company stock worth $46,903,454 over the last three months. 79.39% of the stock is owned by company insiders.

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.