Financial Data and Key Metrics Changes - KLA reported revenue of $3,210,000,000 for the September quarter, exceeding the guidance midpoint of $3,150,000,000 [6][10] - Non-GAAP diluted EPS was $8.81, while GAAP diluted EPS was $8.47, both above the respective guidance ranges [10] - Gross margin improved to 62.5%, driven by a stronger product mix and manufacturing efficiencies [10] - Cash flow from operations reached a record $1,160,000,000, with free cash flow at $1,070,000,000 [11][12] - Total capital return for the quarter was $799,000,000, including $545,000,000 in share repurchases and $254,000,000 in dividends [8][12] Business Line Data and Key Metrics Changes - Advanced Packaging revenue is expected to exceed $925,000,000 for calendar year 2025, representing a 70% year-over-year increase [7] - Service business revenue grew to $745,000,000, up 6% sequentially and 16% year over year [8] - Non-GAAP operating margin was reported at 43.2% [10] Market Data and Key Metrics Changes - KLA anticipates mid to high single-digit growth in wafer fab equipment (WFE) for 2025, driven by investments in leading-edge foundry logic and memory [15] - Advanced Packaging market is expected to grow more than 20% compared to the previous year [15] - The company estimates a revenue impact of approximately $300,000,000 to $350,000,000 due to export controls affecting certain customers in China [16][17] Company Strategy and Development Direction - KLA's strategy focuses on capitalizing on the growing relevance of process control and AI infrastructure investments [6] - The company aims to address all growth markets in WFE, including memory, advanced packaging, and leading-edge logic [9] - KLA is committed to maximizing total shareholder value through disciplined capital allocation and consistent execution [9][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth outlook for 2026, with expectations for a broader spending profile in WFE and Advanced Packaging [15][16] - The company noted constructive customer discussions regarding investments in process control, particularly in leading-edge technologies [30][31] - Management highlighted the importance of advanced process control as design complexity increases, particularly in custom silicon development [21] Other Important Information - KLA's total cash, cash equivalents, and marketable securities stood at $4,700,000,000, with total debt at $5,900,000,000 [12] - The company announced a 12% increase in its quarterly dividend to $1.9 per share, marking the sixteenth consecutive annual dividend increase [13] Q&A Session Summary Question: Insights on WFE growth outlook - Management indicated that the outlook is becoming clearer as customer lead times improve, with positive signs for leading-edge foundry logic and DRAM investments [28][30] Question: Decline in foundry logic revenue - The decline is attributed to a reduction in China, which was elevated in the previous quarter, while leading-edge revenue is expected to increase [38][39] Question: Gross margin guidance - The decrease in gross margin is primarily due to product mix adjustments, with ongoing tariff impacts also considered [42][44] Question: Advanced packaging process control intensity - Management noted that KLA's share in the advanced packaging market has increased significantly, with expectations for continued growth [50][51] Question: DRAM growth expectations - Management expects DRAM to be a growth area next year, driven by increased customer spending and new market requirements [104][105] Question: Foundry-related revenue opportunities - There is encouragement regarding increased engagement with foundries outside the dominant Taiwanese customer, with ongoing discussions about process control needs [108]

Financial Data and Key Metrics Changes - KLA reported revenue of $3.21 billion for the September quarter, exceeding the guidance midpoint of $3.15 billion [8][9] - Non-GAAP diluted EPS was $8.81, while GAAP diluted EPS was $8.47, both above the midpoint of their respective guidance ranges [8][9] - Gross margin improved to 62.5%, 50 basis points above the midpoint of guidance, driven by a stronger product mix and manufacturing efficiencies [9] - Free cash flow reached $3.9 billion with a free cash flow margin of 31% [6] Business Line Data and Key Metrics Changes - Advanced packaging revenue is expected to exceed $925 million for calendar year 2025, representing a 70% year-over-year increase [5] - Satellite service business revenue grew to $745 million in the September quarter, up 6% sequentially and 16% year over year [5] - Non-GAAP operating margin was reported at 43.2% [9] Market Data and Key Metrics Changes - The advanced packaging market is projected to grow more than 20% compared to the previous year [12] - KLA's share of the wafer fab equipment (WFE) market is expected to grow, with the advanced packaging market now estimated at approximately $11 billion [11][12] - China’s contribution to KLA's revenue is expected to decline to the high 20s percentage range due to export controls and normalization [51] Company Strategy and Development Direction - KLA is focusing on capitalizing on the growing demand for advanced packaging and AI infrastructure investments [4][8] - The company aims to outperform the mid to high single-digit growth rate in WFE for 2025, driven by rising process control intensity [12][17] - KLA's strategy includes consistent capital returns and long-term investment to maximize shareholder value [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the semiconductor industry's growth in 2026, with expectations for a broader spending profile compared to 2025 [13] - The company anticipates a revenue impact of approximately $300 million to $350 million due to export controls affecting certain customers in China [14] - Management noted constructive customer discussions regarding investments in leading-edge logic and DRAM, indicating a positive outlook for the industry [25][76] Other Important Information - KLA's total capital return in the September quarter was $799 million, including $545 million in share repurchases and $254 million in dividends [6] - The company announced a $5 billion share repurchase authorization and a 12% increase in quarterly dividends [10][11] Q&A Session Summary Question: Insights on WFE growth outlook - Management indicated that the outlook is more about confidence in timing rather than a significant change in growth expectations, with positive signs from leading-edge foundry logic and DRAM investments [25][26] Question: Decline in foundry/logic revenue - The decline is attributed to a reduction in China’s contribution, which was elevated in the previous quarter, while leading-edge and memory segments are expected to uptick [31][32] Question: Gross margin guidance - The guidance down is primarily due to product mix adjustments, with expectations for gross margins to remain stable based on consistent factory output [35][36] Question: Advanced packaging process control intensity - Management clarified that KLA's share of the advanced packaging market is growing, with expectations for continued growth in process control intensity as designs become more complex [39][42] Question: DRAM growth expectations - Management expects DRAM to be a growth area next year, driven by increased capital intensity and customer investments [75][76] Question: Foundry-related revenue opportunities - There is encouragement regarding broader investment discussions with foundry customers, particularly those looking to improve yield and process control [78]

Financial Data and Key Metrics Changes - The company reported Q3 2025 revenues of $202.7 million, with non-GAAP gross margins at 41%, up 250 basis points from 38.5% in Q2 2025 [23][24] - GAAP gross margins for Q3 were 39.8%, compared to 37.3% in Q2 [25] - Non-GAAP EPS for Q3 was $0.33, exceeding the high end of the outlook range of $0.21 to $0.29 [24][30] - Free cash flow in Q3 was $19.7 million, a significant improvement from negative $47.1 million in Q2 [26] Business Line Data and Key Metrics Changes - In the DRAM Probecards segment, there was double-digit sequential growth in Q3, primarily driven by HBM [10] - The systems segment also saw a sequential revenue increase in Q3, with expectations for further growth in Q4 [15] Market Data and Key Metrics Changes - The company expects continued growth in HBM revenue, with Q4 HBM revenue anticipated to be similar to Q3 levels [10] - Demand in the foundry and logic probecard market was weaker in Q3, with expectations of similar demand levels in Q4 [12] Company Strategy and Development Direction - The company is focused on improving profitability to achieve a target model of 47% non-GAAP gross margins [6][19] - Initiatives include rapid gross margin improvement actions and long-term structural initiatives, such as developing differentiated new products and ramping up the new Farmers Branch facility [8][17] - The company aims to expand its market share in advanced packaging and high-performance compute sectors [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about achieving sequentially higher revenue and gross margins in Q4, building on Q3 performance [6] - The company is addressing challenges such as tariffs and supply chain disruptions while focusing on operational efficiency [19][28] Other Important Information - The company plans to invest between $140 million and $170 million in the Farmers Branch facility over 2026, which is expected to improve gross margins beyond the current target model [27][63] - The company has initiated a share repurchase program to offset dilution from stock-based compensation [27] Q&A Session Summary Question: Insights on HBM growth and Probecard intensity - Management noted that the transition to HBM4 is expected to increase test intensity and complexity, driving growth in Probecard demand [34] Question: Contribution of tactical versus structural improvements to gross margin - Management indicated that both tactical and structural improvements are contributing to the gross margin roadmap, with ongoing benefits expected from restructuring actions [36][38] Question: Impact of CPU and GPU customer ramps on foundry and logic - Management acknowledged the potential for significant revenue impact from CPU and GPU customer ramps, although quantification is challenging at this stage [42][43] Question: Revenue growth drivers in Q4 - Management clarified that revenue growth in Q4 is expected to be driven by a mix of legacy DRAM and improvements in operational efficiency [46][47] Question: Timing of capacity increase from Farmers Branch facility - Management expects initial capacity from the Farmers Branch facility to come online late in 2026, with the majority in 2027 [48] Question: HBM revenue specifics for Q3 - Management confirmed that HBM revenue for Q3 was approximately $40 million, with expectations for growth in Q4 driven by HBM4 [53] Question: Status of CPU customer revenue - Management acknowledged that a major CPU customer did not contribute significantly in Q3 but emphasized the importance of the long-term partnership [56] Question: ASIC projects contribution and updates - Management highlighted ongoing engagements with major hyperscalers in the custom ASIC space, with some revenue contribution in Q3 [60]

Financial Data and Key Metrics Changes - The company reported Q3 2025 revenues of $202.7 million, with non-GAAP gross margins at 41%, up 250 basis points from 38.5% in Q2 2025 [23][24] - GAAP gross margins for Q3 were 39.8%, compared to 37.3% in Q2 [25] - Non-GAAP EPS for Q3 was $0.33, exceeding the high end of the outlook range of $0.21-$0.29 [23][24] - Free cash flow in Q3 was $19.7 million, a significant improvement from negative $47.1 million in Q2 [26] Business Line Data and Key Metrics Changes - In the DRAM probecards segment, there was double-digit sequential growth in Q3, primarily driven by HBM [10] - The systems segment also saw a sequential revenue increase in Q3, with expectations for further growth in Q4 [15] Market Data and Key Metrics Changes - The company expects continued growth in HBM revenue, with Q3 HBM revenue around $40 million, primarily from HBM applications [54] - The foundry and logic probecard market experienced weaker demand in Q3, with expectations for similar levels in Q4 [12] Company Strategy and Development Direction - The company is focused on improving profitability to reach a target model of 47% non-GAAP gross margins, with short-term and long-term initiatives in place [6][19] - The strategy includes optimizing operational effectiveness, reducing manufacturing costs, and expanding capacity at a lower cost through the new Farmers Branch facility [8][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about achieving sequentially higher revenue and gross margins in Q4, driven by improved product mix and cost reduction initiatives [6][28] - The company is addressing challenges such as tariffs and supply chain disruptions while focusing on long-term growth opportunities in advanced packaging and high-performance computing [9][28] Other Important Information - The company plans to invest between $140 million and $170 million in the Farmers Branch facility over 2026, which is expected to enhance gross margins beyond the current target model [27][64] - The company is committed to share repurchase programs to offset dilution from stock-based compensation, with $70.9 million remaining for future purchases [27] Q&A Session Summary Question: Insights on HBM growth and test intensity - Management noted that the transition to HBM4 is expected to increase test intensity and complexity, driving demand for probecards [34] Question: Contribution of tactical versus structural improvements to gross margin - Management indicated that both tactical and structural improvements are contributing to the gross margin roadmap, with ongoing benefits expected [37] Question: Impact of CPU and GPU customer ramps on foundry and logic - Management highlighted that while specific quantification is challenging, significant impacts are anticipated as qualifications and commercial negotiations progress [43] Question: Revenue contribution from ASIC projects - Management confirmed ongoing engagement with major hyperscalers in the custom ASIC space, with contributions expected to grow as specifications align with GPU requirements [61] Question: Timing and focus of capacity expansion at Farmers Branch - Management stated that initial capacity from the Farmers Branch facility is expected to come online late in 2026, with a focus on flexibility to support various product lines [49][50]

Core Insights - KLA Corp has forecasted second-quarter revenue that exceeds Wall Street estimates, driven by strong demand for its chipmaking tools linked to artificial intelligence [1] - The company has highlighted significant risks associated with its business operations in China [1] Revenue Forecast - The anticipated revenue for the second quarter is projected to be above market expectations, indicating robust growth potential in the semiconductor sector [1] - The demand for AI-related technologies is a key factor contributing to this positive outlook [1] Risks - KLA Corp has flagged considerable risks to its operations in China, which may impact future performance [1]

Core Insights - FormFactor, Inc. reported Q3 fiscal 2025 revenues of $202.7 million, a 3.5% increase from Q2 2025 but a 2.5% decrease from Q3 2024 [1] - The company expects to deliver higher results in Q4 2025, building on the profitability improvement initiatives [7] Financial Performance - GAAP net income for Q3 2025 was $15.7 million, or $0.20 per diluted share, compared to $9.1 million, or $0.12 per diluted share in Q2 2025, and $18.7 million, or $0.24 per diluted share in Q3 2024 [3] - Non-GAAP net income for Q3 2025 was $25.7 million, or $0.33 per diluted share, compared to $21.2 million, or $0.27 per diluted share in Q2 2025, and $27.2 million, or $0.35 per diluted share in Q3 2024 [4] - Gross margin for Q3 2025 was 39.8%, up from 37.3% in Q2 2025 but down from 40.7% in Q3 2024 [3] Cash Flow and Operating Activities - GAAP net cash provided by operating activities for Q3 2025 was $27.0 million, compared to $18.9 million in Q2 2025 and $26.7 million in Q3 2024 [5] - Free cash flow for Q3 2025 was $19.7 million, a significant recovery from negative $47.1 million in Q2 2025 [5] Outlook - For Q4 2025, FormFactor anticipates revenues of approximately $210 million, with a gross margin of around 40.0% [7] - The company expects continued improvement in profitability and gross margins due to ongoing initiatives [2][8]

Group 1: Semiconductor Equipment Industry - There has been a positive trend in the semiconductor equipment sector, with companies like Applied Materials, Lamb Research, and KLA Corp reaching new all-time highs due to strong earnings and favorable market conditions [2] - The rhetoric surrounding the semiconductor industry has improved, which is expected to have a positive impact on the market [2] - Despite a challenging year, the semiconductor equipment sector is anticipated to continue its positive momentum [3] Group 2: Healthcare and Biotech Sector - The healthcare sector, particularly pharmaceuticals and biotech, is viewed favorably as growth opportunities are expected to arise, especially leading into the midterm election year of 2026 [6] - There is a focus on the performance of Merck, particularly regarding its cancer drug Kitruda, with concerns about risks associated with its future performance [8] - The financial services engagement environment is expected to support strong performance from S&P Global, indicating a positive outlook for the healthcare sector [5]

I know it seems hard to believe, but there's a lot more going on besides tech. So, we'll do that. Well, I was going to start with KLA and Service Now.All right. You know what. Let's start with Burke.Okay. There there's a lot going on outside of the mega caps. How about that.>> KA JT, they report their earnings today after the bell. >> They do. Um, we're going to hear obviously the restrictions with China wafer fat market.There's been an improvement in the rhetoric. I think that's going to lend itself positi ...

Market Overview - U.S. markets opened positively with Nasdaq up by 0.60%, Dow by 0.4%, and S&P 500 by 0.35%, while Russell 2000 lagged at 0.03% [2] Earnings Reports - Teradyne saw a significant increase of 16% after beating Q3 earnings and providing strong Q4 guidance driven by AI demand [3] - Centene experienced a 10% rise following a positive earnings report and an improved outlook for the year [3] - Fortive also reported a gain of 9.3% [3] Major Declines - Fiserv faced a dramatic decline of 36% after a significant Q3 earnings miss and a downward revision of its full-year guidance, leading to a shake-up in leadership and board [4] - Other notable losers included Avantor at -16%, Garmin at -12%, and Generac Holdings at -11.7%, all reacting negatively to earnings reports [5] Upcoming Events - Over 300 firms are scheduled to report earnings today, including major companies like Caterpillar, Boeing, and Verizon [7] - The Federal Reserve is expected to announce its decision on interest rates later in the day, which could impact market dynamics [7] - Additional factors influencing the market include discussions about a potential China trade deal and concerns regarding SNAP and WIC programs, alongside a prolonged government shutdown [7]

Core Insights - Data I/O Corporation has been awarded the 2025 Step-by-Step Excellence Award for its LumenX-M8 Manual Programming System, highlighting its innovation in the field of data programming and security provisioning [1] Company Summary - Data I/O Corporation is recognized as a leading global provider of data programming and security provisioning for microcontrollers, security ICs, and memory devices [1] Industry Context - The award was presented at the NEPCON Asia tradeshow, which took place at the Shenzhen World Exhibition & Convention Center, emphasizing the importance of innovation and advancement within the industry [1]