Financial Performance Highlights - Revenue for Q4 Fiscal Year 2025 reached $3175 billion, showing a year-over-year growth of 24% and a quarter-over-quarter growth of 4%[11] - The company achieved a gross margin of 632% and an operating margin of 442%[12] - Net income for the quarter was $12 billion[12] - Non-GAAP diluted EPS stood at $938, while GAAP diluted EPS was $906[14] Revenue Breakdown - Semiconductor Process Control segment contributed $2879 billion in revenue, with a year-over-year growth of 25% and a quarter-over-quarter growth of 5%[16] - PCB and Component Inspection segment generated $142 million in revenue, showing a year-over-year growth of 17% but a quarter-over-quarter decrease of 9%[16] - Specialty Semiconductor Process segment accounted for $154 million in revenue, with a year-over-year growth of 10% but a quarter-over-quarter decrease of 9%[16] - Wafer Inspection accounted for $1772 billion in revenue, with a year-over-year growth of 52% and a quarter-over-quarter growth of 18%[19] Regional Performance - Taiwan accounted for 56% of the company's revenue[19] - China contributed 12% to the company's revenue[19] - North America accounted for 14% of the company's revenue[19] Balance Sheet and Cash Flow - The company holds a strong investment-grade balance sheet with total cash of $4495 billion[21] - Free cash flow for the June quarter was $1065 billion, resulting in a free cash flow margin of 34%[33, 34] - The company returned $6797 million to shareholders through share buybacks ($426 million) and dividends ($254 million) in the June quarter[35] Guidance for Q1 FY2026 - The company projects revenue of $315 billion +/- $150 million for the September 2025 quarter[37] - Non-GAAP gross margin is expected to be 62% +/- 1%[37] - Non-GAAP diluted EPS is forecasted at $853 +/- $077[37]

Financial Highlights and Business Outlook [Q4 & Fiscal Year 2025 Performance Summary](index=1&type=section&id=Q4%20%26%20Fiscal%20Year%202025%20Performance%20Summary) KLA reported strong financial results for the fourth quarter and full fiscal year of 2025, with significant year-over-year growth in revenue and earnings per share. The company highlighted the growing relevance of its technologies in supporting the AI infrastructure buildout and achieved a record quarterly free cash flow of over $1 billion - CEO Rick Wallace attributed the strong results to the compelling opportunity in semiconductor capital equipment, driven by the AI infrastructure buildout and innovation in foundry/logic, memory, and advanced packaging markets[3](index=3&type=chunk) - The company achieved record financial flows in Q4, with cash flow from operations at **$1.16 billion** and free cash flow reaching **$1.06 billion**, surpassing the **$1 billion** mark for the first time in a quarter[4](index=4&type=chunk) Q4 Fiscal 2025 Performance Highlights | Metric | Q4 FY 2025 | Q3 FY 2025 | Q4 FY 2024 | | :--- | :--- | :--- | :--- | | **GAAP Results** | | | | | Total Revenues | $3,175 million | $3,063 million | $2,569 million | | Net Income | $1,203 million | $1,088 million | $836 million | | Diluted EPS | $9.06 | $8.16 | $6.18 | | **Non-GAAP Results** | | | | | Net Income | $1,244 million | $1,121 million | $893 million | | Diluted EPS | $9.38 | $8.41 | $6.60 | Full Fiscal Year 2025 Performance Highlights | Metric (GAAP) | Fiscal Year 2025 | Fiscal Year 2024 | | :--- | :--- | :--- | | Total Revenues | $12.16 billion | $9.81 billion | | Net Income | $4.06 billion | $2.76 billion | | Diluted EPS | $30.37 | $20.28 | [First Quarter Fiscal 2026 Guidance](index=1&type=section&id=First%20Quarter%20Fiscal%202026%20Guidance) KLA anticipates revenues for the first quarter of fiscal 2026 to be in the range of $3.15 billion, plus or minus $150 million. The company also provided guidance for GAAP and Non-GAAP gross margin and diluted earnings per share Q1 Fiscal 2026 Guidance | Metric | Guidance Range | | :--- | :--- | | Total Revenues | $3.15 billion +/- $150 million | | GAAP Gross Margin | 60.7% +/- 1.0% | | Non-GAAP Gross Margin | 62.0% +/- 1.0% | | GAAP Diluted EPS | $8.28 +/- $0.77 | | Non-GAAP Diluted EPS | $8.53 +/- $0.77 | Consolidated Financial Statements [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, KLA's total assets grew to $16.07 billion from $15.43 billion in the prior year. This was accompanied by a decrease in total liabilities to $11.38 billion and a significant increase in total stockholders' equity to $4.69 billion, up from $3.37 billion year-over-year Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total current assets | $10,698,789 | $10,031,144 | | Total assets | $16,067,926 | $15,433,566 | | Total current liabilities | $4,085,795 | $4,660,774 | | Total liabilities | $11,375,473 | $12,065,238 | | Total stockholders' equity | $4,692,453 | $3,368,328 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the fiscal year ended June 30, 2025, KLA's total revenues increased to $12.16 billion from $9.81 billion in fiscal 2024. Net income rose substantially to $4.06 billion, or $30.37 per diluted share, compared to $2.76 billion, or $20.28 per diluted share, in the previous year, reflecting strong growth in both product and service revenues Fiscal Year Performance Comparison (in thousands, except per share data) | Metric | Twelve Months Ended June 30, 2025 | Twelve Months Ended June 30, 2024 | | :--- | :--- | :--- | | Product Revenues | $9,472,854 | $7,482,679 | | Service Revenues | $2,683,308 | $2,329,568 | | **Total Revenues** | **$12,156,162** | **$9,812,247** | | Income Before Taxes | $4,644,448 | $3,190,032 | | **Net Income** | **$4,061,643** | **$2,761,896** | | **Diluted EPS** | **$30.37** | **$20.28** | Q4 Performance Comparison (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Total Revenues** | **$3,174,741** | **$2,568,735** | | **Net Income** | **$1,202,849** | **$836,446** | | **Diluted EPS** | **$9.06** | **$6.18** | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In the fourth quarter of fiscal 2025, KLA generated $1.16 billion in cash from operating activities, a notable increase from $892.6 million in the same period last year. The company utilized cash for investing activities, including capital expenditures and securities purchases, and for financing activities, primarily through $425.7 million in stock repurchases and $254.0 million in dividend payments - Key financing activities in Q4 FY2025 included common stock repurchases of **$425.7 million** and dividend payments of **$254.0 million**[11](index=11&type=chunk) Q4 Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,164,991 | $892,615 | | Net cash used in investing activities | ($325,345) | ($138,792) | | Net cash used in financing activities | ($629,813) | ($618,861) | | Net increase in cash and cash equivalents | $220,886 | $128,962 | Supplemental Financial Information [Segment Information](index=6&type=section&id=Segment%20Information) The Semiconductor Process Control segment continues to be the primary revenue driver for KLA, contributing $10.95 billion in fiscal year 2025, up from $8.73 billion in the prior year. The Specialty Semiconductor Process and PCB, Display and Component Inspection segments also experienced year-over-year revenue growth Revenues by Reportable Segment (in thousands) | Segment | Twelve Months Ended June 30, 2025 | Twelve Months Ended June 30, 2024 | | :--- | :--- | :--- | | Semiconductor Process Control | $10,947,359 | $8,733,556 | | Specialty Semiconductor Process | $587,107 | $528,701 | | PCB and Component Inspection | $621,721 | $552,491 | | **Total Segment Revenues** | **$12,156,187** | **$9,814,748** | [Reconciliation of GAAP to Non-GAAP Financial Measures](index=6&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) KLA provides non-GAAP financial measures to offer investors insight into its core operating performance by excluding items such as acquisition-related charges, restructuring costs, and asset impairments. This section details the reconciliation of GAAP net income, EPS, and gross margin to their non-GAAP counterparts, as well as calculations for free cash flow and capital returns - The company presents non-GAAP information to enhance understanding of financial and business trends by excluding certain costs and expenses not indicative of core operating results, such as acquisition-related charges, restructuring, and goodwill impairment[19](index=19&type=chunk) [Net Income and EPS Reconciliation](index=6&type=section&id=Net%20Income%20and%20EPS%20Reconciliation) For Q4 FY2025, KLA's GAAP net income of $1.20 billion reconciles to a non-GAAP net income of $1.24 billion. This adjustment primarily reflects the exclusion of acquisition-related charges. Consequently, non-GAAP diluted EPS was $9.38, compared to GAAP diluted EPS of $9.06 GAAP to Non-GAAP Net Income Reconciliation (in thousands) | Description | Q4 FY 2025 | Q4 FY 2024 | | :--- | :--- | :--- | | GAAP net income | $1,202,849 | $836,446 | | Acquisition-related charges | $50,677 | $58,777 | | Restructuring, severance, etc. | $2,133 | $17,721 | | Tax effects & discrete items | ($11,237) | ($20,135) | | **Non-GAAP net income** | **$1,244,422** | **$892,809** | GAAP to Non-GAAP Diluted EPS Reconciliation | Description | Q4 FY 2025 | Q4 FY 2024 | | :--- | :--- | :--- | | GAAP net income per diluted share | $9.06 | $6.18 | | **Non-GAAP net income per diluted share** | **$9.38** | **$6.60** | [Free Cash Flow and Capital Returns](index=7&type=section&id=Free%20Cash%20Flow%20and%20Capital%20Returns) In Q4 FY2025, KLA generated $1.06 billion in free cash flow, calculated from $1.16 billion in operating cash flow less $100.4 million in capital expenditures. The company returned $679.7 million to shareholders during the quarter through dividends and stock repurchases Free Cash Flow Reconciliation (in thousands) | Description | Q4 FY 2025 | FY 2025 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,164,991 | $4,081,903 | | Capital expenditures | ($100,408) | ($335,259) | | **Free cash flow** | **$1,064,583** | **$3,746,644** | Capital Returns (in thousands) | Description | Q4 FY 2025 | FY 2025 | | :--- | :--- | :--- | | Payments of dividends to stockholders | $253,965 | $904,594 | | Common stock repurchases | $425,697 | $2,149,946 | | **Capital returns** | **$679,662** | **$3,054,540** | [Guidance Reconciliation](index=7&type=section&id=Guidance%20Reconciliation) For its Q1 FY2026 guidance, KLA provides reconciliations for EPS and gross margin. The projected GAAP diluted EPS of $7.51-$9.05 is adjusted to a non-GAAP range of $7.76-$9.30. The GAAP gross margin guidance of 59.7%-61.7% is adjusted to a non-GAAP range of 61.0%-63.0%, primarily due to acquisition-related charges Q1 FY2026 GAAP to Non-GAAP Diluted EPS Guidance Reconciliation | Description | Low | High | | :--- | :--- | :--- | | GAAP net income per diluted share | $7.51 | $9.05 | | Adjustments (Acquisition, Restructuring, Tax) | $0.25 | $0.25 | | **Non-GAAP net income per diluted share** | **$7.76** | **$9.30** | Q1 FY2026 GAAP to Non-GAAP Gross Margin Guidance Reconciliation | Description | Low | High | | :--- | :--- | | GAAP gross margin | 59.7% | 61.7% | | Acquisition-related charges | 1.3% | 1.3% | | **Non-GAAP gross margin** | **61.0%** | **63.0%** | Notes and Disclosures [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This section contains a standard safe harbor provision, cautioning that forward-looking statements, including financial guidance, are subject to numerous risks and uncertainties. It outlines various factors that could cause actual results to differ materially, such as global economic conditions, trade restrictions, industry cyclicality, and cybersecurity threats - The company's forward-looking statements, including its Q1 FY2026 guidance, are based on current expectations and are subject to a number of risks that could cause actual results to differ materially[8](index=8&type=chunk) - Identified risks include weakening financial markets, international trade restrictions (particularly with China), intellectual property disputes, cybersecurity threats, and the cyclical nature of the semiconductor industry[8](index=8&type=chunk) [Use of Non-GAAP Financial Information](index=8&type=section&id=Use%20of%20Non-GAAP%20Financial%20Information) KLA explains its rationale for using non-GAAP financial measures, stating they provide a clearer view of core operational performance for both management and investors. The report details the specific adjustments made, such as excluding amortization of acquired intangible assets, restructuring charges, goodwill impairments, and their related tax effects - Non-GAAP financial information is provided to supplement GAAP results and enhance the user's understanding of the company's operating performance and future prospects[19](index=19&type=chunk) - Specific adjustments to reconcile GAAP to non-GAAP results include acquisition-related charges (e.g., amortization of intangible assets), restructuring and severance costs, impairment of goodwill, and the income tax effects of these adjustments[19](index=19&type=chunk)

Company Overview - Couchbase, Inc. is part of the Computer and Technology sector, which includes 605 individual stocks and holds a Zacks Sector Rank of 5 [2] - The company currently has a Zacks Rank of 2 (Buy), indicating a favorable outlook based on earnings estimate revisions [3] Performance Metrics - Over the past 90 days, the Zacks Consensus Estimate for Couchbase's full-year earnings has increased by 7.5%, reflecting stronger analyst sentiment and an improving earnings outlook [4] - Year-to-date, Couchbase, Inc. has returned approximately 55.7%, significantly outperforming the average gain of 11.2% for Computer and Technology stocks [4] Industry Comparison - Couchbase belongs to the Internet - Software industry, which consists of 173 stocks and is currently ranked 72 in the Zacks Industry Rank; this industry has gained about 15.7% year-to-date, indicating Couchbase's superior performance [6] - In contrast, KLA, another outperforming stock in the Computer and Technology sector, is part of the Electronics - Miscellaneous Products industry, which has a lower year-to-date gain of 14.7% and is ranked 81 [6] Future Outlook - Investors interested in Computer and Technology stocks should monitor Couchbase, Inc. and KLA for potential continued strong performance [7]

Core Insights - KLA Corporation (KLAC) is expected to report its fourth-quarter fiscal 2025 results on July 31, with projected revenues of $3.075 billion, indicating a year-over-year increase of 19.75% [1][10] - The company anticipates non-GAAP earnings of $8.53 per share, reflecting a year-over-year growth of 29.24% [2][10] - KLA has consistently surpassed earnings estimates in the past four quarters, with an average surprise of 5.81% [2] Revenue and Earnings Expectations - The Zacks Consensus Estimate for KLA's revenues is $3.08 billion, which is within the company's guidance range [1] - The expected earnings per share (EPS) of $8.53 is unchanged over the past 30 days, indicating stability in earnings expectations [2] Business Segment Performance - KLA's advanced packaging business is projected to grow significantly, with revenues expected to rise from over $500 million in 2024 to an anticipated $850 million in 2025, driven by increased complexity in chip integration and AI infrastructure [3] - Strong spending on leading-edge logic nodes and high-bandwidth memory technologies supports KLA's position in the wafer fabrication equipment sector [4] Market Drivers - Artificial intelligence (AI) advancements are a key catalyst for KLA, driving demand for advanced semiconductors and process control solutions [5] - The Services division reported $669 million in revenues for the third quarter, marking a 13.3% year-over-year increase, although export restrictions and tariffs may pose challenges [6] Margin and Profitability Concerns - Tariff implementations are expected to compress gross margins by approximately 100 basis points in the upcoming quarter, particularly affecting service operations [7] - KLA's effective tax rate has risen to around 14% due to global tax reforms, which may negatively impact profitability [7] Earnings Outlook - KLA currently has an Earnings ESP of 0.00% and a Zacks Rank of 2 (Buy), indicating a neutral outlook for earnings performance [8]

Group 1 - Multiple companies are scheduled to release their earnings reports throughout the week, indicating a busy earnings season [1] - On Monday, companies like 铿腾电子 are set to report their performance [1] - On Tuesday, Stellantis and AstraZeneca will release their earnings before the European market opens [1] Group 2 - Major U.S. companies such as Boeing, UnitedHealth, and Procter & Gamble are expected to report earnings before the U.S. market opens on Tuesday [1] - Following that, Visa, Booking, and Starbucks will report their earnings after the U.S. market closes on Tuesday [1] - On Wednesday, significant tech companies including Microsoft, Meta Platforms, Qualcomm, and Arm Holdings are scheduled to release their earnings after the U.S. market closes [1] Group 3 - Mastercard is set to report its earnings before the U.S. market opens on Thursday [1] - Apple, Amazon, MicroStrategy, Coinbase, and Coherent will report their earnings after the U.S. market closes on Thursday [1] - On Friday, ExxonMobil, Chevron, and Regeneron Pharmaceuticals are expected to release their earnings before the U.S. market opens [1]

Group 1 - KLA Corporation continues to execute well across segments, with process control becoming increasingly important in a post-EUV world [1] - The adoption of DRAM and HBM technologies is on the rise, indicating a positive trend for the semiconductor industry [1] Group 2 - The analyst emphasizes a focus on investing in companies within oligopolistic sectors that have high barriers to entry, suggesting a strategic approach to investment [1] - There is a preference for mid- to long-term investment horizons, highlighting a growth at a reasonable price strategy [1]

A lot has happened since the publication of my last article about KLA Corporation (NASDAQ: KLAC ). Despite its overvaluation, since January 2024, the stock has gained about 55% versus the S&P 500’s ( SP500 ) gain ofA research analyst and a freelance writer looking for value investment opportunities. I have several years of investing experience. I am mostly interested in writing about bargain stocks of large companies. My interest is not limited to American companies but extends to firms operating in other c ...

Group 1 - KLA's stock closed at $936.53, with a daily increase of +1.59%, outperforming the S&P 500's loss of 0.4% [1] - Prior to the latest trading session, KLA's shares had increased by 3.3%, lagging behind the Computer and Technology sector's gain of 6.34% and the S&P 500's gain of 4.97% [1] Group 2 - KLA's upcoming earnings report is expected on July 31, 2025, with projected earnings per share (EPS) of $8.53, a 29.24% increase year-over-year [2] - The Zacks Consensus Estimate for KLA's revenue is projected at $3.08 billion, reflecting a 19.75% increase from the previous year [2] Group 3 - Full-year Zacks Consensus Estimates for KLA indicate earnings of $32.46 per share and revenue of $12.05 billion, representing year-over-year changes of +36.73% and 0%, respectively [3] - Recent revisions in analyst estimates for KLA are important as they reflect near-term business trends, with positive changes indicating analyst optimism [3] Group 4 - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has shown that 1 stocks have generated an average annual return of +25% since 1988 [5] - KLA currently holds a Zacks Rank of 2 (Buy), with a consensus EPS projection that has moved 0.42% higher in the past 30 days [5] Group 5 - KLA's Forward P/E ratio is 27.8, indicating it is trading at a premium compared to the industry average Forward P/E of 19.28 [6] - KLA's PEG ratio is currently 1.72, which is comparable to the industry average PEG ratio of 1.78 [6] Group 6 - The Electronics - Miscellaneous Products industry, which includes KLA, has a Zacks Industry Rank of 139, placing it in the bottom 44% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Company Performance - KLA's stock has increased by 5.9% over the past month and reached a new 52-week high of $931.96, with a year-to-date gain of 46.5% compared to 8.1% for the Zacks Computer and Technology sector and 12.4% for the Zacks Electronics - Miscellaneous Products industry [1] - KLA has consistently beaten the Zacks Consensus Estimate in the last four quarters, reporting EPS of $8.41 against an estimate of $8.06 in its last earnings report [2] Earnings Projections - For the current fiscal year, KLA is expected to post earnings of $33.16 per share on revenues of $12.05 billion, with a year-over-year change of 2.15% [3] - For the next fiscal year, earnings are projected to be $37.03 per share on revenues of $12.38 billion, reflecting a year-over-year change of 2.77% [3] Valuation Metrics - KLA's stock trades at 27.8X current fiscal year EPS estimates, which is a premium compared to the peer industry average of 19.5X, and at 31.7X on a trailing cash flow basis versus an average of 13.5X for its peers [7] - The stock has a PEG ratio of 1.72, indicating it is not in the top echelon from a value perspective [7] Zacks Rank and Style Scores - KLA holds a Zacks Rank of 2 (Buy) due to a solid earnings estimate revision trend, which aligns with the recommendation for investors to select stocks with Zacks Rank of 1 (Strong Buy) or 2 (Buy) [8] - The company has a Value Score of C, Growth Score of B, and Momentum Score of B, resulting in a combined VGM Score of B [6] Industry Comparison - Universal Electronics Inc. (UEIC) is a notable peer with a Zacks Rank of 2 (Buy), and it has strong scores in Value (A) and Growth (A), although a lower Momentum Score (D) [9] - UEIC is expected to post earnings of $0.52 per share on revenues of $399.18 million for the current fiscal year, having beaten the consensus estimate by 20.00% last quarter [10] - The Electronics - Miscellaneous Products industry is positioned in the top 31% of all industries, indicating favorable conditions for both KLA and UEIC [11]

Core Insights - The demand for data centers is expected to significantly boost semiconductor stocks for years to come, with companies like NVIDIA leading the market with over 80% share in GPUs [1][2]. Group 1: Semiconductor Companies - ASML is a leader in extreme ultraviolet (EUV) lithography systems, essential for producing advanced chips required for AI applications, achieving 52% year-over-year revenue growth in its latest quarter [3][6]. - Applied Materials provides key technologies for chip manufacturing, including processes necessary for high-performance AI chips, and is expected to see revenue growth of 6.5% to $29 billion by 2025 [7][9]. - KLA specializes in yield management, helping manufacturers improve efficiency and reduce defects in chip production, with analysts raising price targets in anticipation of strong earnings [12][13]. Group 2: Market Trends and Projections - The shift towards more power-efficient chips in hyperscale data centers is driving the need for advanced semiconductor technologies [2][4]. - Generative AI workloads necessitate cutting-edge GPUs and specialized accelerators, which rely on precision manufacturing equipment [5]. - Analysts have set a consensus price target of $923.80 for ASML, indicating a potential gain of over 16%, while KLA's stock is currently above its consensus price target, reflecting strong market expectations [6][12].