KLA (KLAC) AI Stock Analysis

• Market Cap: $161.23B
• Dividend Yield: 0.6%
• Average Volume (3M): 1.05M
• Price to Earnings (P/E): 38.5
• Beta (1Y): 2.00
• Revenue Growth: 22.27%
• EPS Growth: 45.32%
• Country: US
• Employees: 15,000
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 8.81
• Shares Outstanding: 131,392,330
• 10 Day Avg. Volume: 1,079,715
• 30 Day Avg. Volume: 1,051,785
• PEG Ratio: 0.59
• Price to Book (P/B): 25.39
• Price to Sales (P/S): 9.80
• P/FCF Ratio: 31.85
• Enterprise Value/Market Cap: 0.89
• Enterprise Value/Revenue: 11.51
• Enterprise Value/Gross Profit: 18.68
• Enterprise Value/Ebitda: 26.81
• 1Y Price Target: $1,315.76
• Price Target Upside: 10.26% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 18
• EPS Forecast (FY): 35.74
• Revenue Forecast (FY): $13.07B

• Rating: 79 Outperform
• Price Target: $1,413.00 ▲(18.40% Upside)

KLA's overall stock score is driven by strong financial performance and positive earnings call sentiment, highlighting growth in advanced packaging and services. Technical analysis supports a bullish outlook, although valuation metrics suggest the stock may be overvalued. The impact of export controls on China is a concern, but the company's strategic focus on high-demand areas positions it well for future growth.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for KLA's products and services, positioning the company well for continued expansion in the semiconductor industry.

Advanced Packaging Momentum

The growth in advanced packaging reflects KLA's ability to capitalize on emerging trends in semiconductor manufacturing, enhancing its competitive edge.

AI Infrastructure Opportunity

KLA's portfolio aligns with AI infrastructure needs, offering long-term growth potential as AI adoption accelerates across industries.

Negative Factors

High Leverage

Significant leverage could limit financial flexibility and increase risk if market conditions deteriorate, impacting long-term stability.

Tariff Impact on Margins

Tariff impacts on margins could pressure profitability, affecting KLA's ability to maintain its high margins in the long term.

Reduced Demand from China

Decreased demand from China could hinder growth prospects, as China is a significant market for semiconductor equipment.

KLA Business Overview & Revenue Model

Company Description

KLA Corporation designs, manufactures, and markets process control, process-enabling, and yield management solutions for the semiconductor and related electronics industries worldwide. It operates through four segments: Semiconductor Process Control; Specialty Semiconductor Process; PCB, Display and Component Inspection; and Other. The company offers integrated circuit (IC) manufacturing products that comprises wafer inspection and review, and metrology; wafer and substrate defect inspection and metrology; reticle defect inspection and metrology; chemical/materials quality analysis; in situ process management and wafer handling diagnostics for IC and original equipment manufacturer (OEM) manufacturing; software products to provide run-time process control, defect excursion identification, process corrections, and defect classification; and refurbished and remanufactured products. It also provides specialty semiconductor manufacturing, benchtop metrology, surface characterization, and electrical property measurement services for general purpose/ lab applications; etch, plasma dicing, deposition, and other wafer processing technologies and solutions for the semiconductor and microelectronics industry. In addition, the company offers direct imaging, inspection, optical shaping, additive printing, and computer-aided manufacturing and engineering solutions for the PCB market; inspection and electrical testing systems to identify and classify defects, as well as systems to repair defects for the display market; and inspection and metrology systems for quality control and yield improvement in advanced and traditional semiconductor packaging markets. The company was formerly known as KLA-Tencor Corporation and changed its name to KLA Corporation in July 2019. KLA Corporation was incorporated in 1975 and is headquartered in Milpitas, California.

How the Company Makes Money

KLA generates revenue primarily through the sale of its semiconductor manufacturing equipment, including inspection and metrology tools, which are critical for ensuring the quality and precision of semiconductor devices. The company also earns income from software solutions that support data analysis and yield management, which are essential for semiconductor manufacturers aiming to maximize output and minimize defects. Additionally, KLA benefits from ongoing service and support contracts, which provide a steady stream of recurring revenue. Strategic partnerships with major semiconductor manufacturers and technology companies further bolster KLA's financial performance, allowing the company to stay at the forefront of technology advancements and benefit from industry growth.

KLA Financial Statement Overview

Summary

KLA demonstrates strong financial performance with high profitability and efficient cash flow management. The company maintains robust margins and returns, but the high leverage could be a concern if not managed carefully. Overall, KLA is well-positioned in the semiconductor industry, with stable growth and profitability.

Income Statement

KLA's income statement shows strong profitability with a consistent gross profit margin above 60% and a net profit margin over 33% in the TTM period. Revenue growth is positive, albeit modest at 3.03% in the TTM, indicating stable demand. The EBIT and EBITDA margins are robust, reflecting efficient operations and cost management.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.30 in the TTM, suggesting significant leverage, which could pose a risk if market conditions worsen. However, the return on equity is impressive at 102.56%, indicating effective use of equity to generate profits. The equity ratio is relatively low, highlighting a reliance on debt financing.

Cash Flow

KLA's cash flow statement is strong, with a free cash flow growth rate of 3.50% in the TTM, indicating healthy cash generation. The operating cash flow to net income ratio is nearly 1, showing that net income is well-supported by cash flows. The free cash flow to net income ratio is also high, underscoring efficient cash management.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	12.52B	12.16B	9.81B	10.50B	9.21B	6.92B
Gross Profit	7.72B	7.58B	5.88B	6.28B	5.62B	4.15B
EBITDA	5.38B	5.34B	3.91B	4.50B	4.01B	2.85B
Net Income	4.24B	4.06B	2.76B	3.39B	3.32B	2.08B
Balance Sheet
Total Assets	16.32B	16.07B	15.43B	14.07B	12.60B	10.27B
Cash, Cash Equivalents and Short-Term Investments	4.68B	4.49B	4.50B	3.24B	2.71B	2.49B
Total Debt	5.89B	6.09B	6.82B	6.06B	6.77B	3.55B
Total Liabilities	11.33B	11.38B	12.07B	11.15B	11.20B	6.90B
Stockholders Equity	4.99B	4.69B	3.37B	2.92B	1.40B	3.38B
Cash Flow
Free Cash Flow	3.87B	3.74B	3.03B	3.33B	3.01B	1.95B
Operating Cash Flow	4.25B	4.08B	3.31B	3.67B	3.31B	2.19B
Investing Cash Flow	-441.43M	-202.48M	-1.48B	-486.87M	-876.46M	-500.40M
Financing Cash Flow	-3.83B	-3.79B	-1.78B	-2.83B	-2.26B	-1.50B

KLA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1193.37
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KLAC, the sentiment is Positive. The current price of 1193.37 is above the 20-day moving average (MA) of 1160.94, above the 50-day MA of 1069.46, and above the 200-day MA of 855.60, indicating a bullish trend. The MACD of 42.14 indicates Positive momentum. The RSI at 57.86 is Neutral, neither overbought nor oversold. The STOCH value of 36.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KLAC.

KLA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AMD	80 Outperform	$415.98B	117.48	5.32%	―	31.83%	80.45%
KLAC	79 Outperform	$161.23B	38.53	99.17%	0.60%	22.27%	45.32%
AMAT	77 Outperform	$186.04B	27.84	35.64%	0.75%	6.70%	-5.95%
LRCX	77 Outperform	$207.31B	36.37	62.26%	0.59%	25.66%	46.68%
ADI	75 Outperform	$116.10B	60.04	5.65%	1.70%	7.08%	18.39%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
INTC	61 Neutral	$173.92B	3,597.17	0.19%	―	-1.49%	―

KLA Corporate Events

KLA Corporation Exceeds Q1 Earnings Expectations

KLA Corporation is a leading provider of advanced process control and process-enabling solutions for the electronics industry, specializing in manufacturing equipment for wafers, reticles, integrated circuits, and printed circuit boards.

Kla Corporation Faces Financial Risks Amid U.S. Tariffs and Trade Restrictions

Kla Corporation faces significant business risks due to recently announced and potential future U.S. tariffs and trade restrictions, which could materially impact its operations. The implementation of tariffs on key materials like aluminum, copper, and steel, along with potential new tariffs on semiconductor-related imports, could increase production costs and disrupt supply chains. Retaliatory tariffs from other countries may further harm demand for Kla’s products, leading to order cancellations and financial losses. Despite efforts to mitigate these risks through operational and pricing strategies, the uncertainty and complexity of evolving trade policies pose a substantial threat to the company’s financial health.

KLA Announces Board Changes and Dividend Declaration

On August 7, 2025, KLA Corporation announced the retirement of Gary Moore and Emiko Higashi from its Board of Directors, effective at the 2025 annual meeting of stockholders. The Board plans to nominate Tracy Embree and Jason Conley as new directors. Additionally, KLA declared a quarterly cash dividend of $1.90 per share, payable on September 3, 2025, to shareholders of record as of August 18, 2025. These changes reflect KLA’s ongoing commitment to strategic leadership and shareholder value.

The most recent analyst rating on (KLAC) stock is a Buy with a $900.00 price target. To see the full list of analyst forecasts on KLA stock, see the KLAC Stock Forecast page.

KLA Corporation Reports Strong Q2 Earnings Amid Challenges

KLA Corporation’s recent earnings call revealed a strong performance, marked by significant revenue growth, robust free cash flow, and impressive earnings per share (EPS). Despite facing challenges like tariff impacts on gross margins and reduced demand from China, the company remains optimistic about its future, buoyed by positive customer discussions for 2026.

KLA Corporation Reports Strong Q4 2025 Earnings

KLA Corporation is a leading provider of process control and yield management solutions for the semiconductor and related microelectronics industries, offering a comprehensive range of products and services to major semiconductor manufacturers worldwide.