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Wall Street analysts forecast that KLA (KLAC - Free Report) will report quarterly earnings of $1.18 per share in its upcoming release, pointing to a year-over-year increase of 34.1%. It is anticipated that revenues will amount to $4.05 billion, exhibiting an increase of 26.1% compared to the year-ago quarter.

The consensus EPS estimate for the quarter has undergone an upward revision of 0.3% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.

Before a company reveals its earnings, it is vital to take into account any changes in earnings projections. These revisions play a pivotal role in predicting the possible reactions of investors toward the stock. Multiple empirical studies have consistently shown a strong association between trends in earnings estimates and the short-term price movements of a stock.

While investors usually depend on consensus earnings and revenue estimates to assess the business performance for the quarter, delving into analysts' forecasts for certain key metrics often provides a more comprehensive understanding.

In light of this perspective, let's dive into the average estimates of certain KLA metrics that are commonly tracked and forecasted by Wall Street analysts.

The average prediction of analysts places 'Revenues- Specialty Semiconductor Process' at $173.38 million. The estimate indicates a change of +44.8% from the prior-year quarter.

Analysts expect 'Revenues- Service' to come in at $853.57 million. The estimate suggests a change of +14.6% year over year.

It is projected by analysts that the 'Revenues- Product' will reach $3.16 billion. The estimate indicates a change of +28.2% from the prior-year quarter.

Analysts predict that the 'Revenues- Semiconductor Process Control' will reach $3.63 billion. The estimate indicates a year-over-year change of +25.4%.

The combined assessment of analysts suggests that 'Revenues- PCB and Component Inspection' will likely reach $207.11 million. The estimate indicates a year-over-year change of +9.3%.

The consensus estimate for 'Geographic Revenues- China' stands at $1.00 billion. The estimate points to a change of -20.7% from the year-ago quarter.

The consensus among analysts is that 'Geographic Revenues- Rest of Asia' will reach $140.74 million. The estimate indicates a year-over-year change of +33.4%.

Analysts forecast 'Geographic Revenues- North America' to reach $522.77 million. The estimate indicates a year-over-year change of +75.5%.

The collective assessment of analysts points to an estimated 'Geographic Revenues- Europe & Israel' of $180.94 million. The estimate indicates a year-over-year change of +19.8%.

Analysts' assessment points toward 'Geographic Revenues- Taiwan' reaching $1.15 billion. The estimate indicates a change of +44.3% from the prior-year quarter.

According to the collective judgment of analysts, 'Geographic Revenues- Korea' should come in at $683.67 million. The estimate indicates a year-over-year change of +128.4%.

Based on the collective assessment of analysts, 'Geographic Revenues- Japan' should arrive at $341.37 million. The estimate suggests a change of +15.6% year over year.

View all Key Company Metrics for KLA here>>>

Over the past month, shares of KLA have returned -21% versus the Zacks S&P 500 composite's -1.2% change. Currently, KLAC carries a Zacks Rank #2 (Buy), suggesting that it may outperform. the overall market in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

Assenagon Asset Management S.A. raised its stake in KLA Corporation (NASDAQ:KLAC – Free Report) by 239.3% during the 3rd quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission. The firm owned 5,614,990 shares of the semiconductor company’s stock after buying an additional 3,959,927 shares during the quarter. KLA accounts for about 0.8% of Assenagon Asset Management S.A.’s portfolio, making the stock its 21st largest position. Assenagon Asset Management S.A. owned approximately 0.43% of KLA worth $1,094,530,000 as of its most recent filing with the Securities and Exchange Commission.

Other hedge funds and other institutional investors have also recently added to or reduced their stakes in the company. WealthPLAN Partners LLC lifted its holdings in KLA by 16.3% during the third quarter. WealthPLAN Partners LLC now owns 2,578 shares of the semiconductor company’s stock worth $503,000 after acquiring an additional 361 shares in the last quarter. Ninety One UK Ltd increased its holdings in shares of KLA by 771.7% in the third quarter. Ninety One UK Ltd now owns 1,848 shares of the semiconductor company’s stock worth $360,000 after acquiring an additional 1,636 shares in the last quarter. WealthPlan Investment Management LLC increased its holdings in shares of KLA by 18.4% in the third quarter. WealthPlan Investment Management LLC now owns 11,243 shares of the semiconductor company’s stock worth $2,192,000 after acquiring an additional 1,750 shares in the last quarter. Nvwm LLC increased its holdings in shares of KLA by 0.9% in the third quarter. Nvwm LLC now owns 12,716 shares of the semiconductor company’s stock worth $2,479,000 after acquiring an additional 111 shares in the last quarter. Finally, HBW Advisory Services LLC raised its position in shares of KLA by 74.7% during the third quarter. HBW Advisory Services LLC now owns 3,127 shares of the semiconductor company’s stock worth $610,000 after purchasing an additional 1,337 shares during the period. Institutional investors own 86.65% of the company’s stock.

Analyst Upgrades and Downgrades KLAC has been the topic of several recent analyst reports. Bank of America lifted their price objective on KLA from $210.00 to $317.00 and gave the company a “buy” rating in a report on Tuesday, June 23rd. Jefferies Financial Group reiterated a “buy” rating and issued a $210.00 price objective (up from $200.00) on shares of KLA in a research report on Wednesday, July 29th. Cantor Fitzgerald reissued an “overweight” rating and set a $325.00 target price on shares of KLA in a research note on Wednesday, July 29th. Susquehanna set a $215.00 target price on shares of KLA and gave the stock a “neutral” rating in a report on Wednesday, July 29th. Finally, The Goldman Sachs Group reaffirmed a “neutral” rating and issued a $230.00 price target on shares of KLA in a research note on Tuesday, July 28th. Eighteen analysts have rated the stock with a Buy rating and eleven have given a Hold rating to the company. According to data from MarketBeat.com, KLA presently has an average rating of “Moderate Buy” and an average price target of $221.26.

Read Our Latest Research Report on KLAC Insider Transactions at KLA In other news, CEO Richard Wallace sold 87,568 shares of the firm’s stock in a transaction that occurred on Tuesday, August 11th. The shares were sold at an average price of $198.95, for a total transaction of $17,421,653.60. Following the completion of the transaction, the chief executive officer directly owned 778,944 shares of the company’s stock, valued at $154,970,908.80. This trade represents a 10.11% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, EVP Brian Lorig sold 59,586 shares of the firm’s stock in a transaction that occurred on Thursday, August 13th. The stock was sold at an average price of $208.13, for a total transaction of $12,401,634.18. Following the transaction, the executive vice president directly owned 77,681 shares of the company’s stock, valued at $16,167,746.53. This represents a 43.41% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last 90 days, insiders sold 243,339 shares of company stock worth $46,903,454. Insiders own 79.39% of the company’s stock.

KLA Stock Performance KLAC opened at $174.46 on Friday. The business’s 50-day moving average price is $187.30 and its two-hundred day moving average price is $196.86. KLA Corporation has a 1 year low of $107.20 and a 1 year high of $307.37. The company has a market capitalization of $227.67 billion, a price-to-earnings ratio of 47.58, a P/E/G ratio of 1.58 and a beta of 1.45. The company has a debt-to-equity ratio of 0.93, a current ratio of 2.88 and a quick ratio of 2.03.

KLA (NASDAQ:KLAC – Get Free Report) last issued its quarterly earnings results on Tuesday, July 28th. The semiconductor company reported $1.05 EPS for the quarter, beating analysts’ consensus estimates of $1.00 by $0.05. The company had revenue of $3.66 billion for the quarter, compared to analyst estimates of $3.61 billion. KLA had a return on equity of 87.66% and a net margin of 35.57%. The company’s quarterly revenue was up 15.2% compared to the same quarter last year. During the same period in the previous year, the company posted $0.94 earnings per share. KLA has set its Q1 2027 guidance at 1.060-1.260 EPS. Equities analysts expect that KLA Corporation will post 5.43 EPS for the current fiscal year.

KLA Increases Dividend The company also recently declared a quarterly dividend, which was paid on Tuesday, September 1st. Shareholders of record on Monday, August 17th were given a dividend of $0.23 per share. This is an increase from KLA’s previous quarterly dividend of $0.23. The ex-dividend date of this dividend was Monday, August 17th. This represents a $0.92 dividend on an annualized basis and a yield of 0.5%. KLA’s payout ratio is currently 25.07%.

KLA Company Profile (Free Report)

KLA Corporation (NASDAQ: KLAC) develops process-control and yield-management solutions used by semiconductor and electronics manufacturers. Its systems help customers detect defects, measure and analyze materials and structures, and monitor manufacturing processes throughout the production of integrated circuits and other advanced electronic components.

The company’s product portfolio includes inspection and metrology systems, wafer and reticle inspection equipment, process-control software, data analytics tools, and related services.

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Key Takeaways KLAC's backlog climbed to $12.57B, driven mainly by demand tied to the AI infrastructure buildout.KLAC expects second-half 2026 revenues to rise about 20% from the first half as supply improves.Advanced-packaging process-control revenues are expected to reach about $1.1B in 2026, up more than 70%. KLA Corporation (KLAC - Free Report) is benefiting from a strong backlog and improving semiconductor equipment demand, supported by accelerating Artificial Intelligence (AI) infrastructure investments and rising spending across leading-edge chip manufacturing. KLAC’s backlog increased to $12.57 billion at the end of fiscal 2026 from $7.86 billion a year earlier, primarily driven by demand tied to the AI infrastructure buildout. The strong order pipeline improves revenue visibility and positions KLAC to capitalize on continued investments in foundry/logic, memory and advanced packaging, while strengthening its competitive position against Applied Materials (AMAT - Free Report) and ASML Holding (ASML - Free Report) .

The broader semiconductor equipment environment is also strengthening. In the fourth quarter of fiscal 2026, KLAC raised its calendar 2026 wafer fabrication equipment market expectation, including advanced packaging, to the low-$150-billion range, up from its earlier view of more than $140 billion and compared with roughly $120 billion in calendar 2025. Management expects broad-based investments across leading-edge logic, foundry, DRAM, high-bandwidth memory (HBM), NAND and advanced packaging to support continued capacity expansion. KLAC expects second-half calendar 2026 revenues to increase roughly 20% from the first half as additional supply becomes available, supporting continued sequential growth into calendar 2027.

Rising semiconductor complexity is increasing demand for KLAC’s inspection, metrology and yield-management solutions. Management expects its semiconductor process-control business to grow at least a few percentage points faster than the overall company as high-performance computing becomes a larger portion of semiconductor spending. KLAC also expects several new greenfield fabs in 2027, creating demand not only for technology upgrades but also for incremental equipment installations. Broadening logic investment, continued HBM adoption, advanced packaging and new fab construction should therefore expand KLAC’s addressable opportunity.

Advanced packaging provides another important catalyst. KLAC expects advanced-packaging process-control systems revenues to reach approximately $1.1 billion in calendar 2026, up more than 70% year over year, almost twice the growth rate of the advanced-packaging market. Its competitive position is also supported by complex process control, algorithmic expertise and a global network of roughly 1,600-1,700 applications engineers.

KLAC Faces Tough CompetitionApplied Materials is benefiting from the same AI-driven semiconductor equipment upcycle. AMAT expects leading-edge foundry/logic, DRAM and advanced packaging to account for roughly 80% of wafer fab equipment growth in 2026 and 2027. Its process diagnostics and control business is expected to grow more than 50% in 2026, supported by e-beam and optical inspection demand. Applied Materials is also expanding manufacturing capacity, targeting the ability to double quarterly system output from current levels by 2028, while some customer discussions now extend to 2030.

ASML Holding is likewise benefiting from accelerating capacity additions across logic and memory. In its second-quarter 2026 update, the company expects full-year 2026 advanced foundry/logic revenues to rise about 25%, memory revenues to increase 75% and EUV revenues to grow roughly 45%. ASML also expects DUV, metrology and inspection revenues to increase about 25% in 2026, supported by higher process-control intensity and greater adoption of optical metrology and e-beam inspection. ASML said it was close to receiving the orders required for 2027 and plans to add roughly 30% to its Low-NA EUV capacity in 2027, while investigating another potential 30% capacity increase in 2028. These capacity investments could intensify competitive pressure on KLAC as semiconductor spending and process-control requirements continue to rise.

KLAC’s Share Price Performance, Valuation & EstimatesShares of KLA Corp. have risen 55.7% year to date compared with the broader Zacks Computer and Technology sector’s 22.6% growth.

KLAC Stock’s Price Performance
Image Source: Zacks Investment Research

KLAC stock is trading at a premium, with forward 12-month price/earnings of 33.24X compared with the broader sector’s 21.27X. KLA Corporation has a Value Score of D.

KLAC’s Valuation
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for KLA Corp.’s earnings is currently pegged at $1.18 per share, unchanged over the past 30 days, suggesting 34.09% year-over-year growth.

KLA Corp. currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

TSMC's advanced-packaging industrial park signals a surge in chip manufacturing complexity, and the companies that profit most will not be the ones building the packages. Three equipment suppliers sit at a critical chokepoint where every additional package produced forces a…

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TSMC is expanding advanced-packaging capacity as demand from Nvidia and other chip designers continues to rise. KLA, Camtek, and Nova sell different types of inspection and metrology equipment used to protect manufacturing yields. KLA offers the broadest exposure, while Camtek and Nova provide greater leverage to specialized packaging applications. Taiwan broke ground on a new advanced-packaging industrial park on September 21, with Taiwan Semiconductor Manufacturing Co. (NYSE: TSM) serving as its principal technology anchor. The project will include facilities where equipment and materials suppliers can test and validate technologies used in advanced packaging before they enter mass production.

For investors, the more important question is not whether TSMC will remain the dominant producer of advanced AI processors. It is which equipment companies benefit as TSMC and its customers increase the number, size, and complexity of the packages they manufacture.

Three companies stand out: KLA Corporation (NASDAQ: KLAC), Camtek Ltd. (NASDAQ: CAMT), and Nova Ltd. (NASDAQ: NVMI). All three sell process-control equipment, but each addresses a different part of the manufacturing problem. KLA provides the broadest inspection platform, Camtek is the most directly exposed to advanced-packaging inspection, and Nova supplies specialized dimensional, materials, and chemical metrology.

Packaging Demand Creates the Equipment Opportunity Advanced packaging connects a high-performance processor with high-bandwidth memory and other components inside one integrated package. As more dies and connections are added, the financial cost of a defect increases. A defective component discovered late in production can result in the loss of several expensive dies rather than one unfinished chip.

This changes the economics of inspection. Semiconductor manufacturers cannot expand packaging output simply by installing more production equipment. They must also add inspection and metrology capacity to identify defects, verify alignment, measure critical dimensions, and control material composition. Higher packaging volume therefore creates demand for the equipment sold by KLA, Camtek, and Nova.

The equipment opportunity can grow faster than the number of packages produced because each new generation introduces additional points that must be inspected. A conventional chip is largely tested as a single device. An advanced package can combine a processor, several memory stacks, interposers, substrates, and thousands of microscopic connections. Inspection may be required before bonding, during assembly, and after the package is completed. The larger number of control points increases equipment demand even if the number of finished packages grows at a slower rate.

Yield also becomes more important as component values rise. If a low-cost chip is found defective near the end of production, the manufacturer loses one device. If a fault is discovered after an advanced processor and multiple HBM stacks have been combined, the loss can include several high-value components and the packaging work already performed. That makes process-control spending a form of economic protection. Manufacturers can postpone some capacity investments, but reducing inspection when package values are increasing can create a much larger financial loss.

According to Table 1, Nvidia-driven CoWoS demand is projected to increase from 360,000 wafers in 2024 to 810,000 in 2027. The forecast represents a 125% increase in three years. The largest annual increase occurs in 2026, when demand is expected to rise 40% to 678,000 wafers as Blackwell Ultra and Rubin CPX production increases.

Table 1: Nvidia-Driven CoWoS Demand Outlook

Year CoWoS Wafers (× 1,000 Units) YoY Growth Estimated GPU Units (Million) Principal Drivers 2024 360 — 5.3 Hopper-to-Blackwell transition 2025 484 34% 6.0 Blackwell full ramp 2026 678 40% 7.4 Blackwell Ultra and Rubin CPX 2027 810 19% 8.2 Continued data-center expansion Source: The Information Network 

The table is important because every additional CoWoS wafer must move through multiple inspection and measurement steps. The opportunity is not limited to Nvidia. Advanced Micro Devices (NASDAQ: AMD), Broadcom (NASDAQ: AVGO), and other designers also rely on TSMC’s packaging technologies for high-performance processors. Nvidia remains the largest demand driver, but the equipment investment is supported by a broader move toward multi-die designs.

The projected increase from 360,000 CoWoS wafers in 2024 to 810,000 in 2027 therefore understates the potential increase in inspection activity. New package generations are not merely increasing unit volume. They are becoming larger and more difficult to manufacture, requiring more measurements per package and tighter tolerances at each production step. This combination of higher volume and greater inspection intensity is what supports the revenue outlook for all three equipment companies.

KLA Offers the Broadest Exposure KLA is the largest and most diversified of the three companies. Its systems inspect patterned wafers and reticles, measure critical dimensions and overlay, analyze defects, and inspect packages, substrates, printed circuit boards, and electronic components. It can benefit before a processor reaches the packaging stage and again when that processor is integrated with memory and other dies.

KLA reported fiscal fourth-quarter 2026 revenue of $3.66 billion, an increase of 15.2% from the prior year. Full-year revenue reached $13.58 billion, while free cash flow totaled $3.77 billion. Management guided to approximately $4.0 billion in revenue at the midpoint for the September quarter, representing an additional sequential increase of about 9%.

KLA’s main advantage is its breadth. Its results do not depend on one customer, one packaging format, or one part of the semiconductor market. The company benefits from leading-edge logic, DRAM, high-bandwidth memory, reticle inspection, and advanced packaging. That diversification makes KLA the strongest core holding of the three, although its larger size means it will not grow as rapidly as a smaller supplier during a packaging-capacity surge.

KLA also benefits after its systems are installed. Inspection tools operate in production environments where uptime and measurement consistency are critical, creating continuing demand for service, maintenance, software, and replacement parts. As customers install more tools, KLA expands an installed base that can produce recurring revenue beyond the original equipment sale. This reduces some of the volatility normally associated with semiconductor capital equipment and gives KLA a second way to benefit from packaging expansion.

The limitation is that advanced packaging represents only one part of a much larger company. A major increase in packaging-related sales can materially improve Camtek’s results because of its smaller revenue base, while the same dollar increase has less effect on KLA’s consolidated growth. Investors choosing KLA are therefore emphasizing competitive strength, cash generation, and diversification rather than the highest possible sensitivity to the packaging cycle.

Camtek Has the Greatest Packaging Leverage Camtek provides the most direct exposure to advanced-packaging inspection. Approximately 75% of its second-quarter revenue came from advanced packaging, and management expects that proportion to approach 80% by the end of 2026.

The company reported second-quarter revenue of $133.2 million, increasing 10% sequentially and 8% from the prior year. Its third-quarter guidance of $158 million to $160 million implies approximately 20% sequential growth at the midpoint. Camtek also received more than $600 million in orders during the first seven months of 2026, with deliveries extending into 2027.

Camtek’s Eagle G5 and Hawk platforms inspect wafers, dies, interconnects, and other structures used in high-volume packaging. The company is also expanding into backside inspection, hybrid bonding, residue detection, and additional metrology applications. Its acquisition of Visual Layer adds software for image analysis and defect classification, which can improve inspection speed and reduce false alarms.

Camtek has the strongest near-term growth profile, but it also carries the greatest concentration risk. If advanced-packaging equipment orders slow or customers postpone capacity additions, Camtek has less diversification than KLA. Investors are therefore receiving greater growth potential in exchange for greater sensitivity to the packaging cycle.

The company’s order intake provides unusual visibility for a business of Camtek’s size. More than $600 million of orders received through the first seven months of 2026 exceeds a full year of revenue at its recent quarterly run rate. Because deliveries extend into 2027, Camtek enters the next year with a larger portion of expected demand already identified. The backlog does not eliminate execution risk, but it reduces dependence on orders that have not yet been placed.

Camtek must still convert those orders into shipments while maintaining gross margins and supporting a larger installed base. A rapid production ramp can pressure manufacturing, field service, and working capital. Customers may also alter delivery schedules even when the underlying projects remain active. These risks do not weaken the long-term packaging thesis, but they help explain why Camtek’s shares can be more volatile than KLA’s when investors question the timing of semiconductor capital spending.

Nova Extends Beyond Visible Defect Inspection Nova occupies a different position. Its systems measure dimensions, film thickness, material composition, and chemical properties throughout semiconductor manufacturing. These measurements become more important as chip structures become smaller vertically and more complex in three dimensions.

Nova reported record second-quarter revenue of $255.0 million, increasing 16% year over year and 8% sequentially. Management guided to third-quarter revenue of $277 million to $287 million, which implies sequential growth of approximately 11% at the midpoint.

The company reported record revenue from advanced logic, advanced packaging, front-end chemical metrology, and its Sentronics dimensional-metrology systems. This gives Nova exposure to packaging growth without making the company entirely dependent on it. Nova also benefits from gate-all-around transistors, advanced DRAM, and new materials used in leading-edge semiconductor production.

Nova’s investment case rests on market-share gains and the expansion of its technology into additional process steps. It is less diversified than KLA but broader than Camtek’s packaging-heavy revenue mix. That makes Nova the middle choice for investors seeking above-market growth with less direct dependence on a single equipment segment.

The distinction between inspection and metrology is important to Nova’s positioning. Inspection determines whether a defect or abnormality is present. Metrology determines whether a structure, film, or material is within the precise limits required for the process to work. As manufacturing tolerances narrow, a structure can appear free of visible defects and still fail because its dimensions or material composition are outside specification. Nova’s tools address that second problem.

This gives Nova opportunities in both package assembly and the fabrication of the chips that enter the package. More advanced processors and memory devices require additional measurement steps before they reach TSMC’s packaging lines. Nova can therefore benefit from the same demand cycle at multiple production stages, although it lacks the broad inspection portfolio and installed-base scale that distinguish KLA.

What Investors Should Watch TSMC’s packaging expansion provides the demand foundation, but the three equipment companies offer different ways to invest in it. KLA has the strongest market position and the broadest protection against a slowdown in any one segment. Camtek has the greatest direct leverage to rising packaging capacity and the strongest near-term revenue acceleration. Nova combines packaging exposure with dimensional, materials, and chemical metrology used elsewhere in advanced chip manufacturing.

For a core semiconductor-equipment position, KLA remains the most defensible choice. Camtek offers the greatest upside if current packaging orders translate into revenue through 2027, while Nova offers a more balanced growth alternative supported by share gains across several measurement categories.

Investors should monitor three different indicators. For KLA, the key question is whether rising process-control intensity continues to outpace overall wafer-fabrication-equipment growth. For Camtek, order conversion and the advanced-packaging percentage of revenue will show whether the current acceleration is durable. For Nova, continued share gains and adoption of new materials and chemical-metrology products will determine whether growth remains broader than the industry’s capital-spending cycle.

The common thesis is straightforward. As TSMC produces more complex packages for Nvidia and other chip designers, manufacturers must inspect more surfaces, measure more structures, and control more process steps. KLA, Camtek, and Nova sell the equipment required to accomplish those tasks, allowing investors to participate in the packaging expansion without relying exclusively on TSMC or a single processor company.

Contact [email protected] for any questions or corrections.

KLA Corporation (NASDAQ:KLAC – Get Free Report) CEO Richard Wallace sold 72,019 shares of the company’s stock in a transaction dated Tuesday, September 15th. The shares were sold at an average price of $171.88, for a total transaction 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 position. The sale was disclosed in a legal filing with the SEC, which is available through this link.

KLA Trading Up 1.0% Shares of KLAC stock opened at $168.98 on Friday. The firm has a 50 day moving average price of $192.92 and a two-hundred day moving average price of $190.60. The company has a quick ratio of 2.03, a current ratio of 2.88 and a debt-to-equity ratio of 0.93. The company has a market capitalization of $220.78 billion, a PE ratio of 46.08, a price-to-earnings-growth ratio of 1.49 and a beta of 1.45. KLA Corporation has a 12-month low of $98.10 and a 12-month high of $307.37.

KLA (NASDAQ:KLAC – Get Free Report) last issued its quarterly earnings data on Tuesday, July 28th. The semiconductor company reported $1.05 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.00 by $0.05. KLA had a return on equity of 87.66% and a net margin of 35.57%.The company had revenue of $3.66 billion during the quarter, compared to analysts’ expectations of $3.61 billion. During the same quarter in the previous year, the company posted $0.94 earnings per share. The business’s revenue was up 15.2% on a year-over-year basis. KLA has set its Q1 2027 guidance at 1.060-1.260 EPS. As a group, analysts predict that KLA Corporation will post 5.42 earnings per share for the current year.

KLA Increases Dividend The company also recently declared a quarterly dividend, which was paid on Tuesday, September 1st. Investors of record on Monday, August 17th were paid a $0.23 dividend. This is a boost from KLA’s previous quarterly dividend of $0.23. The ex-dividend date was Monday, August 17th. This represents a $0.92 annualized dividend and a yield of 0.5%. KLA’s dividend payout ratio is presently 25.07%. Institutional Trading of KLA Institutional investors have recently modified their holdings of the stock. Anchor Investment Management LLC increased its position in shares of KLA by 1,225.0% in the second quarter. Anchor Investment Management LLC now owns 1,590 shares of the semiconductor company’s stock worth $480,000 after purchasing an additional 1,470 shares during the period. Cherry Tree Wealth Management LLC lifted its position in KLA by 900.0% during the second quarter. Cherry Tree Wealth Management LLC now owns 120 shares of the semiconductor company’s stock worth $36,000 after purchasing an additional 108 shares during the period. Bouchey Financial Group Ltd. lifted its position in KLA by 1,038.7% during the second quarter. Bouchey Financial Group Ltd. now owns 1,412 shares of the semiconductor company’s stock worth $426,000 after purchasing an additional 1,288 shares during the period. Capstone Financial Advisors Inc. acquired a new stake in KLA during the second quarter worth about $747,000. Finally, Sequoia Financial Advisors LLC grew its stake in KLA by 942.3% during the second quarter. Sequoia Financial Advisors LLC now owns 54,263 shares of the semiconductor company’s stock worth $16,372,000 after buying an additional 49,057 shares in the last quarter. 86.65% of the stock is currently owned by institutional investors.

Analyst Ratings Changes A number of equities research analysts have recently weighed in on the company. Cantor Fitzgerald reissued an “overweight” rating and set a $325.00 target price on shares of KLA in a report on Wednesday, July 29th. Bank of America upped their price target on shares of KLA from $210.00 to $317.00 and gave the company a “buy” rating in a research note on Tuesday, June 23rd. Scotiabank set a $200.00 price target on shares of KLA in a research report on Wednesday, June 10th. JPMorgan Chase & Co. lifted their price objective on shares of KLA from $200.00 to $238.00 and gave the stock an “overweight” rating in a research note on Wednesday, July 29th. Finally, Wells Fargo & Company set a $245.00 price objective on shares of KLA and gave the company an “overweight” rating in a report on Wednesday, July 29th. One research analyst has rated the stock with a Strong Buy rating, nineteen have issued a Buy rating and nine have issued a Hold rating to the company. According to MarketBeat, the stock has a consensus rating of “Moderate Buy” and an average target price of $222.22.

Read Our Latest Stock Report on KLAC

KLA Company Profile (Get Free Report)

KLA Corporation (NASDAQ:KLAC) develops process-control and yield-management technologies used by semiconductor and other advanced-electronics manufacturers. Its systems help customers detect, measure and analyze defects and variations during the production of integrated circuits, enabling manufacturers to improve process performance, product quality and manufacturing yields.

The company’s portfolio includes wafer and reticle inspection systems, metrology and measurement tools, defect-review and analysis equipment, and software that supports process control and data management.

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Memory spending is accelerating faster than the broader chip equipment market, and three suppliers stand to capture an outsized share of that growth. But their exposure, risks, and upside potential differ in ways that matter before you buy any of…

Global wafer-fabrication-equipment spending is projected to rise 16.9% to $135.2 billion in 2026. DRAM and NAND equipment spending is growing faster than the broader market as AI increases demand for HBM, advanced DRAM and enterprise storage. Lam Research offers the greatest memory exposure, while KLA benefits from increasing process-control intensity and ASML retains an unmatched lithography position. Global wafer-fabrication-equipment spending is projected to reach a record $135.2 billion in 2026, up approximately 16.9% from $115.7 billion in 2025. The headline growth is impressive, but the composition of spending is more important for investors selecting individual semiconductor-equipment stocks.

The equipment cycle is no longer being driven primarily by Taiwan Semiconductor Manufacturing Company’s (NYSE: TSM) | TSM Price Prediction advanced logic capacity. Samsung Electronics (OTC: SSNLF), Micron Technology (NASDAQ: MU)and SK hynix (OTC: SKHYY) are simultaneously increasing investments in advanced DRAM, high-bandwidth memory, NAND, cleanrooms and advanced packaging. This expansion makes memory the fastest-growing major portion of the equipment market.

Three equipment suppliers are particularly well positioned: Lam Research (NASDAQ: LRCX), KLA Corporation (NASDAQ: KLAC) and ASML Holding (NASDAQ: ASML). Each benefits from the same capital-spending expansion, but their exposure, competitive positions and investment risks differ significantly.

Memory Is Accelerating the Equipment Cycle According to Table 1, global WFE spending is projected to increase from $115.7 billion in 2025 to $135.2 billion in 2026. Within that total, 300mm DRAM equipment spending is projected to rise 29% to $37 billion, while 300mm 3D NAND equipment spending is expected to increase 28% to $14 billion.

Logic, foundry and other equipment spending remains the largest category, reaching approximately $84.2 billion. However, its projected growth rate of 10.6% is substantially below the increases anticipated for DRAM and NAND.

The projected $51 billion of combined DRAM and NAND equipment spending represents more than a temporary response to HBM shortages. Memory manufacturers must add cleanroom infrastructure, convert existing production to more advanced processes and install additional etch, deposition, lithography, inspection and metrology tools.

HBM also consumes more wafer capacity than conventional DRAM because it requires larger die sizes, additional processing and multiple stacked memory dies. Consequently, an increase in HBM shipments produces a disproportionately large requirement for manufacturing equipment.

Lam Research: The Strongest Memory Exposure Lam Research is the most direct beneficiary of accelerating memory spending among the three companies. Its etch and deposition systems are used extensively in DRAM and NAND manufacturing, and their importance increases as memory structures become more complex.

Advanced NAND devices require manufacturers to etch extremely deep, narrow channels through hundreds of material layers. Adding more layers increases storage density, but it also makes the etch process more difficult. Lam has built a strong competitive position in these high-aspect-ratio applications.

Advanced DRAM and HBM create another source of growth. Manufacturers must introduce increasingly complex deposition, etch and cleaning processes while controlling extremely small structures across the wafer. These requirements increase the amount of Lam equipment needed for each unit of productive capacity.

Lam reported record June-quarter revenue of $6.72 billion, exceeding the company’s previous quarterly performance. Fiscal 2026 revenue reached approximately $23.23 billion, up from $18.44 billion in fiscal 2025. The company also recently increased its quarterly dividend by 27%, from $0.26 to $0.33 per share.

The principal risk is that Lam’s memory leverage works in both directions. If manufacturers eventually add too much DRAM or NAND capacity, memory pricing would weaken and capital spending could decline sharply. For now, however, a significant portion of customer investment is supporting cleanrooms, advanced processes and technology conversions rather than indiscriminate additions of commodity capacity.

Lam ranks first because it combines strong current financial performance with the greatest direct exposure to the fastest-growing WFE categories.

KLA: More Complexity Requires More Process Control KLA occupies a different position in the equipment cycle. It does not depend as heavily on the number of memory wafers produced. Instead, it benefits from the increasing difficulty of manufacturing each wafer at an acceptable yield.

KLA’s inspection and metrology systems identify defects and measure critical dimensions throughout the manufacturing process. These capabilities become more valuable as semiconductor structures shrink, memory stacks become taller and advanced packages combine increasingly expensive logic and HBM components.

A small defect that might have destroyed a relatively inexpensive conventional chip can now ruin an AI package containing a leading-edge processor, multiple HBM stacks and advanced interconnects. As the value of the completed package rises, manufacturers have a stronger financial incentive to inspect earlier and more frequently.

KLA reported fiscal fourth-quarter revenue of $3.66 billion, representing growth of approximately 15% from the previous year and 7% sequentially. Fiscal 2026 revenue reached $13.58 billion, while GAAP net income totaled $4.83 billion. Its profitability reflects the high value customers place on yield improvement and defect reduction.

KLA also has a more balanced exposure across advanced logic, memory and advanced packaging. This reduces its dependence on any single equipment category. The tradeoff is that its stock may not provide the same immediate upside as Lam when memory capital spending accelerates sharply.

KLA ranks second because process-control intensity is increasing across nearly every advanced semiconductor application. Its growth is tied not only to the number of fabs under construction but also to the rising cost of manufacturing errors.

ASML: The Lithography Monopoly Remains Intact ASML remains the semiconductor industry’s most strategically important equipment supplier. It is the only company capable of producing extreme-ultraviolet lithography systems in commercial volumes, giving it a position that competitors cannot easily reproduce.

ASML reported second-quarter 2026 net sales of €9.3 billion, a 54% gross margin and net income of €2.9 billion. The company increased its expected 2026 net sales range to between €43 billion and €45 billion, with a projected gross margin between 54% and 56%.

Memory manufacturers use EUV lithography selectively in advanced DRAM production, while leading-edge logic manufacturers depend on it for multiple critical layers. ASML therefore benefits from both sides of the current equipment cycle.

Its deep-ultraviolet systems also remain essential for less-advanced layers and mature semiconductor technologies. Recent announcements regarding Chinese immersion DUV development do not eliminate ASML’s technological lead, particularly in EUV, system productivity, installed-base support and manufacturing scale.

ASML ranks third for this specific memory-focused comparison because its revenue exposure is broader and less directly tied to DRAM and NAND spending than Lam’s. Nevertheless, it offers the strongest technological moat and the clearest long-term competitive position of the three companies.

Which Semiconductor-Equipment Stock Is the Best Buy? Lam Research provides the greatest leverage to the current memory-equipment acceleration. The projected 29% increase in DRAM equipment spending and 28% increase in NAND equipment spending directly support demand for its etch, deposition and cleaning systems.

KLA offers a more balanced way to participate. Its process-control business benefits from increasing semiconductor complexity regardless of whether the next dollar of capital spending is directed toward HBM, advanced logic, NAND or advanced packaging.

ASML provides the strongest structural moat. Its lithography position, raised 2026 guidance and lack of a credible EUV competitor support a long-term investment thesis extending well beyond the present memory cycle.

For investors seeking the greatest near-term exposure to rising memory capital spending, Lam Research is the strongest selection. KLA ranks second based on increasing inspection and metrology intensity, while ASML ranks third for this particular cycle despite possessing the strongest long-term competitive position.

The principal industry risk remains eventual memory overinvestment. Samsung, Micron and SK hynix have historically continued adding capacity after demand began to moderate, eventually producing oversupply and reductions in equipment spending. Current investment remains concentrated on advanced products, cleanrooms and process migrations, suggesting that the cycle has not yet reached that stage.

The 2026 WFE expansion is broader than the AI-logic investment cycle that originally drove equipment stocks. Memory has become the accelerator, and investors should select equipment companies based on how directly their technologies participate in that growth.

Note: The photo on this article is Intel’s ex-CEO Pat Gelsinger.  I will be interviewing him on-stage where he will be Keynote Speaker at the COSM Technology Conference,  November 18-20, 2026 in Scottsdale, AZ, along with my colleague George Gilder.  Please stop by.

Contact [email protected] for any questions or corrections.

Key Takeaways KLA expects advanced packaging process-control revenues to top $1.1B in 2026, rising more than 70%.Hybrid bonding, HPC and HBM are increasing inspection and measurement steps, supporting KLA's tool demand.Onto raised its 2026 packaging growth outlook to 80%, while Applied Materials expects over 50% growth. KLA (KLAC - Free Report) is benefiting from accelerating demand for advanced packaging as AI and high-performance computing (HPC) chips require increasingly complex integration of logic and memory. Rising package complexity, higher performance requirements and growing chip values are increasing the need for inspection, metrology and process-control tools. KLA stated that the increasing complexity and value of semiconductor packages, particularly for AI and HPC applications, is driving significant growth in its advanced packaging business. The company’s strong portfolio is strengthening competitive prowess against Onto Innovation (ONTO - Free Report) and Applied Materials (AMAT - Free Report) .

The momentum is already translating into strong revenue growth. KLA expects advanced packaging process-control systems revenues to reach approximately $1.1 billion in calendar 2026, representing growth of more than 70% year over year. The company attributed the expansion to rising process-control intensity as chip designs become more complex and performance specifications become more demanding. Technology transitions such as hybrid bonding are creating additional opportunities. Along with HPC and High-Bandwidth Memory (HBM) adoption, advanced packaging technologies like hybrid bonding are increasing the number of inspection and measurement steps required during manufacturing, supporting demand for KLA's tools.

KLA’s broad portfolio allows the company to capture spending across multiple stages of advanced packaging. KLAC’s wafer inspection and metrology systems help manufacturers detect and monitor defects and process excursions in wafer-level packaging, while chemistry process-control systems monitor materials used in wafer-level and panel-level packaging and IC substrates. Advanced packaging is also benefiting businesses beyond KLA’s core Semiconductor Process Control operations. HPC packaging and integration are driving demand within its Specialty Process and PCB and Component Inspection businesses, with these combined products expected to grow more than 25% in calendar 2026.

Tough Competition Hurts KLAC’s ProspectsOnto Innovation and Applied Materials are well known for their advanced packaging process control offerings.

Onto is emerging as a particularly strong challenger in packaging inspection and metrology. The company raised its 2026 advanced packaging growth outlook to approximately 80%, up from 50% previously, driven by strong demand from HBM manufacturers and outsourced semiconductor assembly and test (OSAT) customers. Onto secured more than $200 million of Dragonfly orders from a single OSAT, with most shipments scheduled for 2027. The company’s Dragonfly inspection business grew 30% sequentially in the second quarter of 2026, supported by 2.5D logic and HBM applications.

Applied Materials is increasingly challenging KLA in process diagnostics and control. Applied Materials expects this business to grow more than 50% in 2026, supported by greater use of e-beam metrology and inspection for increasingly complex structures and new optical-inspection products aimed at gaining application share. Moreover, its EPIC co-innovation strategy gives Applied deeper access to customers developing future chip and packaging architectures, potentially allowing it to secure process-control positions earlier in the technology-development cycle.

KLAC’s Share Price Performance, Valuation & EstimatesKLAC shares have jumped 50.9% year to date, outperforming the broader Zacks Computer and Technology sector’s return of 15.4%.

KLAC Stock’s Performance
Image Source: Zacks Investment Research

KLA stock is overvalued, with a forward 12-month price/sales of 13.05X compared with the broader sector’s 6.32X. KLAC has a Value Score of D.

KLAC Valuation
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for fiscal 2027 earnings is pegged at $5.43 per share, up 7.1% over the past 30 days, suggesting 44.41% growth from the figure reported in fiscal 2026.

KLA currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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At $183.99, KLA Corporation (NASDAQ:KLAC | KLAC Price Prediction) looks compelling at current levels. The stock has fallen 14.2% over the past month even as management raised its outlook on the two fastest-growing corners of the semiconductor equipment market, creating a rare dislocation in a stock that rarely goes on sale.

KLA sells the inspection, metrology, and process-control tools that chipmakers rely on to keep yields high as transistor geometries shrink. Management says the company runs at roughly 6x its nearest rival in overall process-control share, giving it a near-monopoly position on a segment that grows faster than the underlying market as complexity rises.

The pullback traces to renewed anxiety about U.S. export controls on China and a broad rotation out of semi-cap names, not to any deterioration in the business. Fiscal Q4 revenue reached $3.66 billion, up 15.21% year over year, with non-GAAP EPS of $1.05 beating expectations, the fifth consecutive beat.

Why the Dip Looks Like an Invitation Management raised its calendar 2026 wafer-equipment market outlook to the low $150 billion range and lifted advanced-packaging systems revenue guidance to roughly $1.1 billion, growth of more than 70% year over year. CEO Rick Wallace said “momentum across our business accelerating in the second half of calendar 2026 and continuing through 2027.”

The service business anchors the model. Services revenue hit $820 million, up 17% year over year, with roughly 80% under contract. Fabs must run inspection tools around the clock regardless of the equipment cycle, which softens downturns. Capital intensity per wafer also rises at each successive node, so process-control spend expands faster than baseline WFE growth. Shares trade at a 34 forward P/E, well below the 50 trailing multiple as earnings scale into guidance.

Where the Bear Case Bites KLA carries real China risk. Management acknowledged that competitors have shifted into fabs in China KLA cannot serve, and any tightening of Bureau of Industry and Security rules would compress the addressable market. Gross margin of 62.4% is absorbing tariff headwinds and memory-pricing pressure that may persist through 2027.

Insider activity adds caution. In August, the CEO, CFO, and multiple executive officers executed sizable open-market disposals, including a 87,568-share sale by Wallace at $198.95. Free cash flow slipped, with Q4 FCF of $817 million, down 23.24% year over year as working capital funds the ramp.

Reasons to Wait KLA is not obviously cheap. A 17.7 price-to-sales ratio and 38 price-to-book leave little margin for a cyclical stumble. With shares up 51.99% year to date and 112.04% over one year, a patient investor could wait for the September quarter print to confirm the accelerating second-half thesis before committing.

What the Numbers Say KLAC trades at $183.99 against a consensus analyst target of $231.78, implying meaningful upside. Coverage skews constructive, with 5 strong buy, 13 buy, 11 hold, and 0 sell ratings across 29 analysts.

KLAC is up 51.99% year to date while the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) has moved from 729.46 at the Q4 filing to 765.72 currently. Shares sit well below the 50-day moving average of $220.07 and closer to the 200-day of $168.52.

Why the Selloff Is the Opportunity At $183.99, the setup looks attractive. Q1 FY2027 guidance calls for revenue of $4.0 billion plus or minus $200 million and non-GAAP EPS of $1.16 plus or minus $0.10. Management expects second-half calendar 2026 growth of roughly 20% over the first half, with backlog around $12.5 billion.

The risk/reward at a 34 forward P/E favors buyers. Advanced packaging alone is expected to grow almost two times faster than the market, and HBM plus EUV-driven DRAM intensity should carry process-control demand into calendar 2027. The company returned $876.33 million to shareholders in Q4 and just added a $7 billion buyback authorization.

What would invalidate the thesis: a broader China export-control escalation that cuts guidance, or a September-quarter miss that breaks the beat streak. Absent that, the setup pairs an accelerating end market with a stock trading nearly 40% below its 52-week high of $307.03. Buying the dominant process-control franchise during an AI capex acceleration, at a discount to its own recent multiple, is a research-worthy setup at this price.

Contact [email protected] for any questions or corrections.

Abacus FCF Advisors LLC purchased a new stake in KLA Corporation (NASDAQ:KLAC – Free Report) during the 2nd quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The institutional investor purchased 68,818 shares of the semiconductor company’s stock, valued at approximately $20,763,000. KLA makes up about 3.8% of Abacus FCF Advisors LLC’s investment portfolio, making the stock its 3rd largest holding.

Several other large investors have also modified their holdings of the business. Bank of New York Mellon Corp acquired a new stake in shares of KLA during the second quarter valued at $2,522,430,000. Handelsbanken Fonder AB boosted its position in KLA by 978.2% during the second quarter. Handelsbanken Fonder AB now owns 858,984 shares of the semiconductor company’s stock worth $259,164,000 after acquiring an additional 779,317 shares during the last quarter. Wedge Capital Management L L P NC grew its stake in KLA by 781.5% in the 2nd quarter. Wedge Capital Management L L P NC now owns 359,277 shares of the semiconductor company’s stock worth $108,397,000 after acquiring an additional 318,520 shares during the period. Bessemer Group Inc. grew its stake in KLA by 0.7% in the 1st quarter. Bessemer Group Inc. now owns 180,279 shares of the semiconductor company’s stock worth $265,444,000 after acquiring an additional 1,291 shares during the period. Finally, Clal Insurance Enterprises Holdings Ltd raised its holdings in KLA by 151.2% in the 1st quarter. Clal Insurance Enterprises Holdings Ltd now owns 116,292 shares of the semiconductor company’s stock valued at $171,230,000 after acquiring an additional 70,000 shares during the last quarter. 86.65% of the stock is currently owned by institutional investors and hedge funds.

KLA News Roundup Here are the key news stories impacting KLA this week:

Positive Sentiment: Wall Street analysts remain broadly optimistic on KLA, with Wells Fargo maintaining an “Overweight” rating. The company’s latest quarterly results also exceeded consensus estimates, with revenue of $3.66 billion and earnings of $1.05 per share. Is KLA a Buy as Wall Street Analysts Look Optimistic? Positive Sentiment: Institutional interest was mixed but included significant second-quarter additions by Invesco, Norges Bank, Capital International Investors and JPMorgan, potentially providing longer-term support for KLAC. KLA Falls as Investors Digest Guidance and Sector Pressure Insider Buying and Selling at KLA In related news, EVP Mary Beth Wilkinson sold 13,802 shares of the firm’s stock in a transaction on Wednesday, August 5th. The shares were 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 directly owned 22,110 shares of the company’s stock, valued at approximately $4,322,505. This trade represents a 38.43% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, CFO Bren D. Higgins sold 27,701 shares of the business’s stock in a transaction dated Thursday, July 2nd. The stock was sold at an average price of $265.69, for a total value of $7,359,878.69. Following the completion of the transaction, the chief financial officer owned 263,472 shares in the company, valued at approximately $70,001,875.68. This trade represents a 9.51% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last 90 days, insiders sold 258,533 shares of company stock worth $55,977,470. 91.48% of the stock is currently owned by insiders. Analyst Ratings Changes A number of equities research analysts have recently commented on KLAC shares. New Street Research lifted their price objective on KLA from $146.00 to $177.00 and gave the company a “neutral” rating in a research report on Wednesday, April 29th. Scotiabank set a $200.00 target price on KLA in a research report on Wednesday, June 10th. Oppenheimer reissued an “outperform” rating and issued a $260.00 price target (up from $200.00) on shares of KLA in a research note on Thursday, July 16th. Stifel Nicolaus set a $250.00 price target on KLA and gave the company a “buy” rating in a report on Wednesday, July 29th. Finally, Cantor Fitzgerald restated an “overweight” rating and set a $325.00 price objective on shares of KLA in a report on Wednesday, July 29th. One research analyst has rated the stock with a Strong Buy rating, nineteen have given a Buy rating and nine have issued a Hold rating to the company’s stock. Based on data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average target price of $223.70.

Check Out Our Latest Stock Analysis on KLAC

KLA Stock Performance Shares of KLAC stock opened at $187.27 on Thursday. 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 company has a market cap of $244.68 billion, a PE ratio of 51.07, a P/E/G ratio of 1.50 and a beta of 1.45. The company’s fifty day simple moving average is $222.57 and its 200-day simple moving average is $185.73. KLA Corporation has a 52 week low of $83.22 and a 52 week high of $307.37.

KLA (NASDAQ:KLAC – Get Free Report) last announced its quarterly earnings results on Tuesday, July 28th. The semiconductor company reported $1.05 earnings per share for the quarter, topping analysts’ consensus estimates of $1.00 by $0.05. KLA had a net margin of 35.57% and a return on equity of 87.66%. The firm had revenue of $3.66 billion during the quarter, compared to analysts’ expectations of $3.61 billion. During the same period in the prior year, the company earned $0.94 EPS. The firm’s revenue was up 15.2% on a year-over-year basis. KLA has set its Q1 2027 guidance at 1.060-1.260 EPS. As a group, equities research analysts anticipate that KLA Corporation will post 5.42 EPS for the current year.

KLA Increases Dividend The company also recently announced a quarterly dividend, which will be paid on Tuesday, September 1st. Stockholders of record on Monday, August 17th will be paid a $0.23 dividend. This represents a $0.92 annualized dividend and a dividend yield of 0.5%. This is a boost from KLA’s previous quarterly dividend of $0.23. The ex-dividend date is Monday, August 17th. KLA’s payout ratio is currently 25.07%.

About KLA (Free Report)

KLA is a provider of process control and yield management solutions for the semiconductor and related microelectronics industries. The company designs and manufactures equipment, software and services used by chipmakers to analyze and control manufacturing processes, detect defects, measure critical dimensions and improve yield across wafer fabrication, photomask and packaging operations. KLA’s offerings are aimed at enabling production of advanced logic, memory, and specialty devices at progressively smaller technology nodes and more complex package structures.

Its product portfolio includes optical and e-beam inspection systems, metrology tools for critical dimension and film measurement, mask and reticle inspection platforms, as well as enterprise software and data analytics that aggregate process data and drive automated process control.

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KLA Corporation (NASDAQ:KLAC | KLAC Price Prediction) trades at $195.78 against a consensus 12-month analyst target of $230.85, implying roughly 17.9% of upside. One Wall Street pro thinks that gap should be nearly four times wider.

KLA is the dominant supplier of semiconductor process control and yield management systems. Its inspection and metrology tools sit between chipmakers and shippable wafers, making it a leveraged play on the AI infrastructure buildout across foundry/logic, memory, and advanced packaging.

KLA just posted a clean beat and strong forward guidance, yet the stock sold off hard. That combination is what put a $325 target on the table.

An Export-Rules Panic Overwhelmed a Clean Earnings Beat The 10.74% one-month drop traces to renewed worries about U.S. Bureau of Industry and Security export restrictions on sales into China, where KLA generated roughly $4.04 billion in the last fiscal year, approximately 30% of annual revenue.

Management guided Q1 FY2027 revenue to $4.0 billion plus or minus $200 million with non-GAAP EPS of $1.16 plus or minus $0.10, implying sequential acceleration but landing below several sell-side models. Profit-taking on a big YTD run added fuel. Insider selling drew attention as well, roughly $34 million across multiple officers in recent weeks, though disclosed under Rule 10b5-1 plans adopted February 2, 2026.

Why Cantor Fitzgerald Sees Roughly 66% Upside From Here The bull case rests on process control intensity at leading-edge nodes. Cantor Fitzgerald’s C.J. Muse holds an Overweight rating with a $325 price target, implying about 66% upside from current levels. As logic scales to 2nm and below with Gate-All-Around transistors and Backside Power Delivery Networks, yield management becomes exponentially harder, and KLA’s optical and electron-beam inspection tools become indispensable. That drives a structural increase in KLA’s share of total Wafer Fabrication Equipment spending.

The second pillar is advanced packaging and High-Bandwidth Memory stacking. Multi-chiplet architectures and HBM3e/HBM4 stacking require ultra-precise wafer screening before die assembly. Muse frames KLA as a near-monopoly in high-end process control for heterogeneous integration, positioning it as a tollbooth on the AI hardware buildout he expects to push the industry toward a $3.5 trillion run-rate.

The broader Street is friendly but less aggressive. Of 29 analysts, 5 rate KLAC Strong Buy, 13 Buy, 10 Hold, and 1 Sell. Zacks upgraded the name to Strong Buy on August 1, 2026. The fifth consecutive EPS beat gives the thesis a live catalyst: the Q1 FY27 report needs to clear the guided $4.0 billion midpoint to force sell-side revisions higher toward Cantor’s outlier.

KLAC Fell Harder Than Its Peers The semi-cap group all pulled back last month, but KLAC took the worst of it.

Applied Materials (NASDAQ:AMAT) trades at $527.48 against a $629.09 target, about 19% upside. It fell 4.87% over the past month. Sentiment is firmly positive with 32 Buy or Strong Buy ratings against 7 Holds.

Lam Research (NASDAQ:LRCX) sits at $305.77 with a $368.13 target, roughly 20% upside. Down 6.24% in the last month. 29 Buy or Strong Buy calls versus 6 Holds, with recent guidance well received.

Onto Innovation (NYSE:ONTO) trades at $268.70 versus a $369.60 target, about 38% upside, the largest consensus setup in the group. Down 4.01% for the month, with all 10 covering analysts at Buy or Strong Buy.

On consensus math, ONTO screens with the biggest implied upside. But KLA is the only name where a top-tier analyst has staked out a target implying 60%-plus upside, so the bull case has meaningfully more room to run if the AI capex thesis holds.

A 59% YTD Run That Just Gave Some Back KLAC is down 10.74% over one month, still up 59.43% year to date, and up 118.92% over one year. The S&P 500 is up 12.71% YTD, so KLAC remains well ahead of the index even after the drawdown. Twenty-nine analysts cover the stock, with a consensus 12-month target of $230.85.

Valuation reflects the run: trailing P/E of 53x, forward P/E of 36x, revenue TTM of $13.58 billion, and diluted EPS TTM of $3.61. FY26 free cash flow was $3.77 billion, and the company returned $2.29 billion via buybacks.

The Setup The bull case strengthens if the Q1 FY27 report clears the $4.0 billion revenue midpoint and management reiterates AI capex commentary. That confirms the buildout Muse is betting on and would force the sell-side toward the $325 outlier. Advanced packaging and HBM demand look durable, and five straight EPS beats show the operating model is working.

The bear case takes over if U.S. export rules on China tighten further. China is roughly 30% of revenue, and even a partial reset would knock estimates down quickly. A 53x trailing multiple leaves no margin for error if AI capex momentum slows.

The 66%-to-70% upside case requires China exposure to hold and AI capex to accelerate, though the sharp reset has already priced in real fear. The skew looks favorable on the current setup for investors comfortable with the China risk.

Contact [email protected] for any questions or corrections.

Key Takeaways KLA expects advanced packaging process control revenue to reach $1.1B in 2026, up more than 70%.AI chiplets, 2.5D/3D integration and hybrid bonding are increasing process control intensity.KLA expects revenue growth to accelerate in the second half of 2026 and continue into 2027. KLA (KLAC - Free Report) is benefiting from the rapid adoption of advanced packaging, which has become a key enabler of AI infrastructure. As AI processors become more complex, the requirement for advanced packaging technologies such as chiplets, 2.5D/3D integration and hybrid bonding is increasing rapidly. These technologies require significantly higher process control intensity, creating strong demand for KLA’s inspection, metrology and yield-management solutions.

Advanced packaging roadmaps are increasingly adopting sophisticated wafer front-end manufacturing techniques, requiring more front-end process control capabilities, according to KLA management. Driven by the industry’s most comprehensive process control portfolio, KLA expects its Advanced Packaging process control systems revenue to reach approximately $1.1 billion in calendar 2026. This represents more than 70% year-over-year growth, well above KLAC’s previous expectation of high-50% growth and nearly twice the growth rate of the advanced packaging market.

Beyond its core Semiconductor Process Control business, advanced packaging is also driving growth in KLA’s Specialty Process, PCB and Component Inspection businesses. High-performance computing packages and increasingly complex AI chip packaging are boosting demand for these products. KLA expects these combined businesses to grow more than 25% in calendar 2026, reflecting the benefits of the Orbotech acquisition.

KLA sees advanced packaging as a long-term growth engine. The company raised its outlook for the wafer equipment market, including advanced packaging, to approximately the low-$150 billion range in calendar 2026 (up from prior expectation of more than $140 billion) and continues to expect significant industry growth in calendar 2027, driven by investments across leading-edge logic, DRAM, HBM, NAND and advanced packaging capacity. KLAC expects technologies such as hybrid bonding, together with AI computing, HBM and EUV adoption, to increase process control intensity across the semiconductor ecosystem. This will support accelerating revenue growth in the second half of 2026 and continued momentum into 2027.

Tough Competition Hurts KLAC’s ProspectsKLAC is facing stiff competition from the likes of Onto Innovation (ONTO - Free Report) and Applied Materials (AMAT - Free Report) , both of which are well known for their advanced packaging process control offerings.

Onto Innovation’s expanding inspection and metrology portfolio for AI-driven packaging applications is a key catalyst. ONTO expects advanced packaging revenues to grow more than 50% in 2026, supported by qualification of its Dragonfly G5 inspection platform at a leading 2.5D logic customer, growing adoption of its 3DI metrology systems for shrinking micro-bump inspection and JetStep lithography wins for panel-level packaging. Onto Innovation also highlighted a pipeline of more than 15 applications across over 10 customers, positioning it to gain market share in both existing and new packaging applications.

Applied Materials’ advanced packaging technology portfolio extends beyond process control into deposition, etch, hybrid bonding and packaging integration. AMAT expects advanced packaging revenue to increase more than 50% in calendar 2026, driven by AI-related demand for high-bandwidth memory (HBM) and 3D chiplet architectures. Applied Materials has invested heavily in hybrid bonding, panel-level packaging, glass substrates and packaging inspection technologies, including the planned NEXX acquisition and X-ray capabilities, while emphasizing leadership in HBM packaging equipment.

KLAC’s Share Price Performance, Valuation & EstimatesKLAC shares have jumped 40% year to date, outperforming the broader Zacks Computer and Technology sector’s return of 8.9%.

KLAC Stock’s Performance
Image Source: Zacks Investment Research

KLA stock is overvalued, with a forward 12-month price/sales of 12.68X compared with the broader sector’s 6.13X. KLAC has a Value Score of F.

KLAC Valuation
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for fiscal 2027 earnings is pegged at $5.07 per share, up 2.5% over the past 30 days, suggesting 34.84% growth from the figure reported in fiscal 2026.
 

KLA currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

July 28 (Reuters) - KLA Corp (KLAC.O), opens new tab on Tuesday beat fourth-quarter revenue estimates and forecast ​first-quarter revenue above Wall Street expectations, but its shares fell ‌9% in extended trading as the results failed to meet investor expectations.

The company's shares have risen more than 57% so far this year, driven by higher ​demand from foundries and memory-chip makers expanding capacity to support ​the data-intensive requirements of generative AI applications.

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KLA provides process control ⁠and yield management systems, which are critical for identifying and correcting ​defects during the semiconductor manufacturing process. Its tools become more vital as ​chipmakers move to smaller and more complex production nodes.

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KLA's results and forecast were better than expected, but were not eye-popping by any means, CFRA ​analyst Brooks Idlet said.

"In the midst of the past few days' ​selling pressure, investors are hoping for blowout results that are strong enough to shake ‌the ⁠market's bearish narrative around hyperscaler spending sustainability and emerging Chinese competition," Idlet added.

KLA expects first-quarter revenue of $4 billion, plus or minus $200 million, ahead of analysts' average estimate of $3.92 billion, according to data compiled by ​LSEG.

It forecast adjusted ​earnings of $1.16 per ⁠share, plus or minus 10 cents, for the quarter, also ahead of an estimate of $1.14.

KLA sees momentum ​across its business accelerating in the second half of ​2026 and ⁠continuing through 2027, CEO Rick Wallace said, adding that the AI infrastructure buildout is also driving new growth opportunities in advanced packaging for the ⁠company.

The ​semiconductor equipment maker's fourth-quarter revenue grew 15.1% ​to $3.66 billion, beating estimates of $3.60 billion.

Adjusted profit came in at $1.05 per share, compared with an ​estimate of $1.

Reporting by Juby Babu in Mexico City; Editing by Shailesh Kuber

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Key Takeaways KLA's fiscal Q3 revenues rose 11% to a record $3.42B as AI drove stronger process control demand.Advanced packaging process control revenues are expected to reach about $1B in calendar 2026.Services revenues rose 16% to $775M, adding recurring cash flows that support shareholder returns. Artificial intelligence is reshaping semiconductor manufacturing, and KLA Corporation (KLAC - Free Report) appears to be one of the biggest beneficiaries. While AI demand is boosting chipmakers' investments in advanced logic and high-bandwidth memory (HBM), it is also increasing the need for sophisticated process control solutions that improve yield, reliability and manufacturing efficiency.

KLA's third-quarter fiscal 2026 results reflected this trend. Revenues rose 11% year over year to a record $3.42 billion, while non-GAAP earnings per share (EPS) increased to $9.40. Management emphasized that AI is now a core driver of the company's business, supporting stronger demand across foundry, memory and advanced packaging. The company also raised its expectations for advanced packaging process control revenues to roughly $1 billion in calendar year 2026 from about $635 million in 2025, well above its previous outlook. AI-enabled chip architectures and increasingly complex packaging technologies continue to expand KLA's addressable market.

Beyond wafer inspection, KLA is benefiting from rising process control intensity as chip designs become more complex. Larger die sizes, faster product cycles, higher-value wafers and the rapid adoption of HBM require greater inspection and metrology throughout the manufacturing process. These structural changes are helping KLA gain market share while strengthening its competitive position.

The company's services business adds another layer of stability. Services revenues increased 16% year over year to $775 million, providing recurring cash flows that support shareholder returns. Management also expects quarter-to-quarter revenue growth throughout calendar year 2026 and believes the wafer equipment market will strengthen further in 2027.

Although higher DRAM costs and tariff-related pressures remain margin headwinds, KLA's technology leadership, expanding process control portfolio and growing exposure to AI infrastructure spending position it as one of the clearest long-term winners from the semiconductor industry's AI investment cycle.

How Competitors Are Positioned Against KLA StockTwo of KLA's closest competitors are Onto Innovation (ONTO - Free Report) and Nova Ltd. (NVMI - Free Report) , both of which are benefiting from AI-driven semiconductor investments but remain more specialized than KLA.

Onto has built a strong position in advanced packaging inspection, optical metrology and lithography process control, areas seeing rising demand as AI chips become more complex. Onto continues expanding its advanced packaging portfolio and is gaining from growing adoption of chiplet architectures. However, Onto has a narrower product portfolio and significantly smaller service business, limiting its ability to match KLA's scale and broad process control ecosystem.

Nova focuses on metrology solutions that help semiconductor manufacturers improve yield at advanced process nodes. Nova is benefiting from increasing process complexity in leading-edge logic and high-bandwidth memory production, while Nova continues investing in materials metrology and AI-enabled analytics. Nevertheless, KLA maintains a wider inspection and metrology portfolio, stronger market leadership, greater exposure to advanced packaging and a much larger recurring services business, giving it a competitive advantage as AI infrastructure spending accelerates.

KLA’s Stock Price Performance, Valuation & EstimatesShares of KLA have surged 113.6% year to date (YTD), outperforming the industry, as shown below.

KLAC YTD Price Performance

Image Source: Zacks Investment Research

From a valuation standpoint, KLA trades at a forward price-to-earnings (P/E) multiple of 52.71, significantly above the industry’s average, as shown below.

KLAC’s P/E Ratio (Forward 12-Month) vs. Industry

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for KLA’s fiscal 2026 and 2027 earnings per share (EPS) implies a year-over-year increase of 11.4% and 34.1%, respectively. The EPS estimates for fiscal 2026 and 2027 have risen in the past 60 days, respectively.

EPS Trend of KLAC Stock

Image Source: Zacks Investment Research

KLAC stock currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.