KLA Corporation (KLAC) — Company Research
Last Updated: 26 June 2026
KLA Corporation (NASDAQ: KLAC) is the dominant supplier of process-control equipment to the semiconductor industry — the inspection and metrology tools chipmakers use to find defects and measure structures at the atomic scale. With roughly 58% of the global process-control market, KLA sits at a critical chokepoint in advanced-chip manufacturing, and the artificial-intelligence build-out has driven record demand. The company reported its fiscal year ended 30 June 2025 and, more recently, its fiscal third-quarter 2026 results for the quarter ended 31 March 2026. Note that KLA completed a 10-for-1 forward stock split effective 12 June 2026; per-share figures in the historical tables below are shown as originally reported (pre-split). Follow the live price on our Live Charts page.
1. Company Snapshot
| Field | Value |
|---|---|
| Ticker / Exchange | KLAC (NASDAQ) |
| Sector | Technology — Semiconductor Equipment |
| CEO | Rick Wallace (President & Chief Executive Officer) |
| Headquarters | Milpitas, California, USA |
| Employees | ~15,000 |
| Share price (Jun 2026, post-split) | ~$240 |
| Market cap (Jun 2026) | ~$314 billion |
| Revenue (FY2025) | $12.16 billion |
| GAAP net income (FY2025) | $4.06 billion |
| GAAP diluted EPS (FY2025, pre-split) | $30.37 |
| Non-GAAP diluted EPS (FY2025, pre-split) | $33.28 |
| Dividend / yield | $0.23 per share quarterly (post-split) / ~0.33% |
| Fiscal year end | 30 June |
2. Bull and Bear Case
Bull Case
- Process-control near-monopoly: KLA holds roughly 58% of the global process-control market, a position protected by decades of accumulated data, software and customer trust that is extremely hard to displace.
- AI build-out demand: management raised its 2026 wafer-fab-equipment outlook to over $140 billion, and process-control revenue from advanced packaging is expected to nearly double to about $1 billion in 2026.
- Best-in-class profitability: KLA runs the highest gross margin of the major equipment makers (about 61–62%), converting strong revenue growth into substantial free cash flow.
- Powerful cash returns: KLA generated about $4.0 billion of trailing free cash flow and raised its dividend 21% in 2026, marking continued double-digit dividend growth alongside heavy buybacks.
- Structural tailwind: as chips grow more complex, defect-detection intensity rises, so process control tends to grow faster than the broader equipment market.
Bear Case
- Stretched valuation: after a sharp AI-driven re-rating, KLA trades on a high-60s trailing P/E and roughly 24x sales, leaving little room for disappointment.
- Industry cyclicality: semiconductor capital spending is famously cyclical, and revenue fell year over year in fiscal 2024 before the current upswing.
- China exposure and export controls: evolving U.S. Bureau of Industry and Security rules can restrict sales to certain Chinese customers, a meaningful demand source.
- Customer concentration: a handful of leading-edge foundry, logic and memory customers drive a large share of revenue, so a single capex pause has outsized impact.
- Insider selling: recent Form 4 activity skewed to selling, including by the CEO, which some investors read cautiously after a large run.
3. Business Segments
KLA reports three segments. Percentages are share of FY2025 total revenue of $12.16 billion.
| Segment | % of revenue | What it is |
|---|---|---|
| Semiconductor Process Control | ~90% ($10.95bn) | Inspection and metrology systems and services for wafer and reticle manufacturing — KLA’s core franchise. |
| Specialty Semiconductor Process | ~5% ($0.59bn) | Etch and deposition tools for specialty devices and advanced packaging. |
| PCB and Component Inspection | ~5% ($0.62bn) | Inspection and test for printed circuit boards, packaging and electronic components. |
4. Business Model
KLA sells capital equipment and recurring services to semiconductor manufacturers, earning revenue when chipmakers invest in new capacity and technology nodes, and again over the life of each installed tool through service and upgrades.
How it makes money. The product business sells high-value inspection and metrology systems — often millions of dollars each — to leading-edge foundry, logic and memory fabs. As manufacturing shrinks and grows more complex, customers need more measurement and defect-detection per wafer, which expands KLA’s addressable market faster than overall equipment spending.
Recurring service moat. A large and growing installed base generates high-margin service revenue (about $2.7 billion in FY2025) that is far steadier than equipment sales, smoothing the industry’s cyclicality. KLA’s accumulated process knowledge and software make its tools deeply embedded in customer workflows.
Capital allocation. KLA returns most of its free cash flow to shareholders via a fast-growing dividend and consistent buybacks, while reinvesting heavily in R&D (about $1.36 billion in FY2025) to defend its technology lead.
5. Financial Health
All figures are from KLA earnings releases and SEC filings. The annual table covers the five fiscal years ended 30 June; per-share figures are as originally reported (pre the 10-for-1 split effective 12 June 2026).
| Fiscal Year | Revenue | YoY % | GAAP EPS | Adjusted EPS | Dividend/share | Long-term debt (YE) |
|---|---|---|---|---|---|---|
| FY2021 | $6.92bn | +19.1% | $13.37 | — | $4.20 | — |
| FY2022 | $9.21bn | +33.1% | $21.92 | — | $5.20 | — |
| FY2023 | $10.50bn | +13.9% | $24.15 | — | $5.80 | — |
| FY2024 | $9.81bn | −6.5% | $20.28 | $23.74 | $6.80 | $5,880m |
| FY2025 | $12.16bn | +23.9% | $30.37 | $33.28 | $7.60 | $5,884m |
Note: revenue dipped in fiscal 2024 during the semiconductor downturn before rebounding strongly in fiscal 2025. Dividends per share are annual run-rates (pre-split); the quarterly dividend was raised 21% to $2.30 in 2026 and is $0.23 on a post-split basis.
Quarterly revenue and EPS (most recent first; per-share figures pre-split):
| Quarter | Revenue | Non-GAAP EPS | GAAP EPS |
|---|---|---|---|
| Q3 FY2026 | $3.42bn | $9.40 | $9.12 |
| Q2 FY2026 | $3.28bn | $8.85 | $8.68 |
| Q1 FY2026 | $3.22bn | $8.70 | $8.46 |
| Q4 FY2025 | $3.18bn | $9.38 | $9.06 |
| FY2025 total | $12.16bn | $33.28 | $30.37 |
For the twelve months ended 31 March 2026, KLA generated about $4.40 billion of operating cash flow and roughly $4.01 billion of free cash flow on trailing revenue of about $13.1 billion. At 31 March 2026 the company held $1,787m of cash plus $3,171m of marketable securities against $5,887m of long-term debt.
6. Valuation
Raw metrics, June 2026. Not opinions on whether the stock is cheap or expensive.
| Metric | Value |
|---|---|
| Market cap | ~$314bn (Jun 2026) |
| Trailing P/E (GAAP) | ~67x (market cap ~$314bn / TTM GAAP net income ~$4.67bn to Mar-2026) |
| P/E (forward) | ~65x (market cap ~$314bn / FY2026E net income ~$4.8bn; 9-month FY2026 GAAP net income already $3.47bn) |
| P/S (TTM) | ~24x (market cap ~$314bn / TTM revenue ~$13.1bn) |
| P/FCF | ~78x (market cap ~$314bn / TTM FCF ~$4.01bn; FCF = operating CF ~$4.40bn − capex ~$0.43bn per TTM cash flow) |
| Enterprise value | ~$315bn (market cap ~$314bn + total debt ~$5.9bn − cash & securities ~$5.0bn per Mar-2026 balance sheet) |
| EV/EBITDA (TTM) | ~55x (EV ~$315bn / EBITDA ~$5.7bn; EBITDA = TTM operating income ~$5.3bn + D&A ~$0.4bn) |
| 52-week high | $269.90 (post-split adjusted) |
| 52-week low | $83.22 (post-split adjusted) |
| Short interest (% of float) | ~2.2% (Feb 2026, ~2.6m shares short pre-split) |
| Days to cover | Not published in retrieved sources; KLA trading liquidity is high. Verify on Finviz/MarketBeat. |
7. What They Are Building
KLA’s growth agenda centres on the most demanding parts of chipmaking. As leading-edge logic and high-bandwidth memory scale for AI, defect-detection and measurement intensity rise, expanding demand for KLA’s inspection and metrology tools. A key focus is advanced packaging — the techniques used to stack and interconnect chips for AI accelerators — where KLA expects process-control revenue to nearly double from about $635 million in 2025 to roughly $1 billion in 2026. Management has raised its 2026 wafer-fab-equipment market outlook to more than $140 billion, citing the AI infrastructure build-out, and continues to invest heavily in R&D (about $1.36 billion in FY2025) to extend its technology lead in optical and e-beam inspection, metrology and process-window-qualification software. The recurring-service business, tied to a large installed base, is also being expanded to smooth the industry’s cyclicality.
8. Competitive Landscape
KLA leads process control but operates within a consolidated equipment industry where a handful of firms command most of the market. Market caps are as of June 2026.
| Peer | Market cap (Jun 2026) | Key 2025 metric |
|---|---|---|
| ASML | ~$690bn | EUV lithography monopoly; ~51% gross margin |
| Applied Materials (AMAT) | ~$460bn | Broadest wafer-fab-equipment portfolio; ~47% gross margin |
| Lam Research (LRCX) | ~$465bn | Etch and deposition leader; ~48% gross margin |
9. Leadership and Ownership
KLA is led by Rick Wallace as President and Chief Executive Officer, based in Milpitas, California. Over the 90 days to mid-June 2026, insider activity skewed toward selling: President & CEO Rick Wallace sold roughly 45,120 shares (about $10 million) around 11 June 2026, and aggregate insider sales were approximately $19.7 million, much of it routine for executives after a large share-price run. There was no material insider open-market buying during the period reviewed. The shareholder base is dominated by large institutional index and active managers, typical for a mega-cap technology company.
10. Key Risks
- Valuation (Financial): a high-60s trailing P/E prices in years of strong growth; any demand wobble could trigger a sharp de-rating.
- Cyclicality (Macro): semiconductor capital spending swings with the chip cycle, and KLA’s revenue has fallen year over year as recently as fiscal 2024.
- China export controls (Regulatory): tightening U.S. restrictions on equipment sales to certain Chinese customers could remove a meaningful slice of demand.
- Customer concentration (Operational): a small number of leading-edge foundry, logic and memory customers drive much of revenue, amplifying the impact of any single capex decision.
- Competition and technology shifts (Operational): ASML, Applied Materials and Lam Research compete in adjacent steps, and a missed technology transition could erode KLA’s lead.
- Geopolitics and tariffs (Macro): trade tensions, tariffs and supply-chain disruption could raise costs and complicate international operations.
11. Recent Developments
- 31 Jul 2025 — Fiscal 2025 results. KLA reported full-year revenue of $12.16bn and GAAP diluted EPS of $30.37, with record quarterly free cash flow above $1bn in the June quarter.
- 12 Mar 2026 — Dividend raised 21%. The board increased the quarterly dividend to $2.30 per share (pre-split).
- 29 Apr 2026 — Fiscal Q3 2026 results. Revenue rose 11% year over year to $3.42bn; GAAP diluted EPS was $9.12 and non-GAAP EPS $9.40, both above guidance, with gross margin of 62.2%.
- 07 May 2026 — 10-for-1 stock split announced. KLA’s board approved a ten-for-one forward split to improve share accessibility.
- 12 Jun 2026 — Stock split effective. KLA shares began trading on a split-adjusted basis.
12. Key Dates
- 23 Jul 2026 — Fiscal fourth-quarter and full-year 2026 results
- Expected Aug 2026 — Next quarterly dividend declaration ($0.23 per share, post-split)
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Disclaimer: This research is produced by ChartsView for educational and informational purposes only. It does not constitute financial advice or a recommendation to buy or sell any security. All information is sourced from publicly available company filings, press releases, and official data. ChartsView does not use analyst opinions or third-party ratings. Always conduct your own due diligence and consider your personal financial situation before making investment decisions. Past performance is not indicative of future results.
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13. Thesis Verdict
The central thesis. KLA Corporation is the dominant supplier of semiconductor process-control (inspection and metrology) equipment, with roughly 58% global share and the highest gross margin among the major equipment makers. In fiscal 2025 it grew revenue 23.9% to $12.16bn with GAAP EPS of $30.37, and trailing free cash flow is about $4.0bn. The primary driver is the AI build-out, which lifted its 2026 wafer-fab-equipment outlook above $140bn and is set to nearly double advanced-packaging process-control revenue to about $1bn.
What would confirm or break it. Confirmation would come from continued double-digit revenue growth and margin strength as AI capex persists, validated at the upcoming fiscal Q4 and full-year report. The thesis would weaken if the AI-driven valuation (a high-60s P/E) de-rates on any demand wobble, if the chip cycle turns, or if tightening China export controls remove a meaningful slice of demand.
Watchpoints
- ConfirmsFiscal Q4 and full-year 2026 earnings (27 days) landing in line with or above management guidance.
- ConfirmsEvidence supporting the "Process-control near-monopoly:" thesis continuing to build across subsequent filings.
- InvalidatesMaterialisation of the "Valuation (Financial):" risk, or any disclosure that fundamentally alters the capital-return or growth profile stated by management.
Diagnostic grid
Generated by ChartsView research tooling. Thesis strength measures how well the evidence in this report supports the company's stated thesis — it is NOT a buy/sell rating or price target. ChartsView is not authorised by the FCA to provide regulated investment advice. Generated 26 Jun 2026.