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Kulicke & Soffa Industries, Inc. (KLIC)
NASDAQ:KLIC
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Kulicke & Soffa
(NASDAQ:KLIC)
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Rating:62Neutral
Price Target:
$70.00
▲(1.33% Upside)
Action:ReiteratedDate:02/06/26
The score is held back most by weakened profitability (recent net loss) despite resilient cash generation and a low-leverage balance sheet. Technicals are supportive with strong price momentum above key moving averages, and the latest earnings call/guidance suggests improving demand and a stronger FY26 outlook, while valuation remains constrained by negative earnings (negative P/E) and only a modest dividend yield.
Positive Factors
Low leverage
A very low debt-to-equity ratio (~0.05) gives Kulicke & Soffa durable financial flexibility. With minimal leverage the company can fund R&D, capacity expansion or weather semiconductor cyclicality without relying on external financing, preserving optionality over multiple quarters.
Positive cash generation
Sustained positive operating and free cash flow through a downcycle supports ongoing operations, aftermarket services and strategic investments. Reliable cash generation reduces refinancing risk and funds capex/capacity expansion (e.g., Singapore) without immediate reliance on equity or debt markets.
Advanced packaging traction
Meaningful installed base (120 TCB units), first HBM shipment and a 3x fluxless capacity expansion indicate durable product leadership in advanced packaging. Expected >$100M TCB revenue diversifies revenue mix toward higher-growth, higher-margin assembly segments over the medium term.
Negative Factors
Recent net loss
A recent substantial net loss weakens returns on equity and reduces internally generated capital for reinvestment. Persisting bottom-line deficits can constrain shareholder returns, limit discretionary R&D/capex unless offset by cash reserves, and prolong recovery through the cycle.
Memory revenue volatility
Concentration-driven swings in memory demand create lumpy revenues and planning uncertainty. Such variability can cause periodic underutilization or sudden margin pressure, complicating long-term capacity planning and undermining predictability of cash flows for multi-quarter investments.
One-time margin drivers
Portions of recent margin gains reflect one-off accounting recognition rather than recurring operational improvement. Combined with delayed commercialization timelines and pending technology qualifications, sustainable margin expansion and revenue from new products may be pushed into FY27, limiting near-term earnings durability.
Kulicke & Soffa (KLIC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.61B
Dividend Yield1.77%
Average Volume (3M)835.57K
Price to Earnings (P/E)―
Beta (1Y)1.46
Revenue Growth-7.38%
EPS Growth99.38%
CountryUS
Employees2,677
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)0.44
Shares Outstanding52,326,515
10 Day Avg. Volume815,189
30 Day Avg. Volume835,574
Financial Highlights & Ratios
PEG Ratio-99.97
Price to Book (P/B)2.60
Price to Sales (P/S)3.27
P/FCF Ratio22.17
Enterprise Value/Market Cap0.96
Enterprise Value/Revenue5.06
Enterprise Value/Gross Profit12.02
Enterprise Value/Ebitda-105.83
Forecast
1Y Price Target
$66.67Price Target Upside-3.49% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)1.5
Revenue Forecast (FY)$777.45M
Kulicke & Soffa Business Overview & Revenue Model
Company DescriptionKulicke and Soffa Industries, Inc. designs, manufactures, and sells capital equipment and tools used to assemble semiconductor devices. It operates through two segments, Capital Equipment, and Aftermarket Products and Services (APS). The company manufactures and sells advanced displays; die-transfer, flip-chip, and TCB advanced packaging products; ball bonder, die-attach, electronics assembly, lithography, wafer-level bonder, and wedge bonder products; consumables, such as capillaries, dicing blades, and wedge bonds; and auto offline programming, KNet PLUS, and new product introduction/manufacturing execution system software products. It also services, maintains, repairs, and upgrades equipment. The company serves semiconductor device manufacturers, integrated device manufacturers, outsourced semiconductor assembly and test providers, other electronics manufacturers, industrial manufacturers, and automotive electronics suppliers primarily in the United States and the Asia/Pacific region. Kulicke and Soffa Industries, Inc. was founded in 1951 and is headquartered in Singapore.
How the Company Makes MoneyKulicke & Soffa generates revenue through the sale of semiconductor assembly equipment, which comprises a significant portion of its income. The company also earns money from consumables, spare parts, and maintenance services related to its equipment, creating a recurring revenue stream. Additionally, KLIC benefits from long-term contracts and partnerships with major semiconductor manufacturers and foundries, which provide stability and predictability in its earnings. The company's investment in research and development allows it to stay at the forefront of technology, leading to new product offerings that can command premium pricing and expand its market share.
Kulicke & Soffa Key Performance Indicators (KPIs)
Kulicke & Soffa Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call presents a notably positive operational and financial inflection: strong sequential and year-over-year revenue growth in general semiconductor, high utilization rates (notably >90% in China), healthy margins (~49.6%) and encouraging guidance (Q2 revenue up ~15% to $230M, FY26 second half projected +15%–20%). Advanced packaging (TCB/Fluxless) shows meaningful traction with >120 systems in the field, a >$100M TCB revenue expectation, and a 3x capacity expansion in Singapore. Offsetting these positives are memory revenue variability, persistent near-term automotive/industrial headwinds, some margin benefit from previously expensed/impaired systems (one-time), pending technology qualifications (FTC plasma) and later commercialization timelines for HBM/HBF (volume in FY27/CY27). Overall, positives materially outweigh the headwinds.Q1-2026 Updates
Positive Updates
Improving Demand and High Utilization
Company reports demand improving faster and stronger than expected with customer sentiment strengthened; utilization for key end markets estimated over 80% overall and China above 90%, North America/Europe ~80%, rest of Asia ~80%, Southeast Asia ~70% and rising.
Strong General Semiconductor Growth
General semiconductor revenue increased 27% sequentially and over 90% year-over-year, driven by technology and capacity needs across all reportable segments; utilization in this market estimated over 80%.
Memory Ball-Bonding Capacity Tightness
Ball bonding utilization for memory exceeded 85% (up from mid-70% range last year), signaling healthy capacity for NAND assembly despite quarter-to-quarter variability in memory revenue.
Sequential Improvement in Automotive & Industrial
Automotive and industrial revenue improved 15% sequentially in the December quarter, and management remains positive on long-term secular trends (e.g., semiconductor content per vehicle expected to double over 10 years).
Aftermarket Growth
Aftermarket products and services revenue increased 14% year-over-year, reflecting increased production activity and improved utilization of the installed base.
Solid Profitability and Margins
Reported gross margin of 49.6% in the quarter with GAAP EPS of $0.32 and non-GAAP EPS of $0.44; company targets gross margin around 49% for the next quarter and 49%–50% range for FY26.
Positive Guidance and Revenue Growth Outlook
March-quarter guidance calls for revenue to increase ~15% sequentially to $230 million, non-GAAP operating expenses of $73 million, GAAP EPS targeted at $0.53 and non-GAAP EPS at $0.67; management expects the second half of FY26 to be ~15%–20% better than the first half.
Advanced Packaging Traction and Capacity Expansion
Shipped first HBM system to a large memory customer during the quarter; company has 120 thermocompression bonding (TCB) systems in the field (about half Fluxless) and is expanding its Singapore fluxless TCB production capacity by 3x.
TCB Revenue Run-Rate
Management expects TCB-related revenue to be over $100 million for the fiscal year, indicating significant contribution from advanced packaging solutions.
Product Progress — Advanced Dispense and Power Semiconductor
Introduced new ACELON dispense system with positive customer feedback and multiple engaged customers; company reports continued progress and market-leading solutions in power semiconductor assembly.
Negative Updates
Memory Revenue Variability
Memory revenue was volatile: after a 60% increase in the prior quarter, demand declined sequentially in the reported quarter due to product and customer mix, reflecting concentration-driven variability.
Automotive and Industrial Near-Term Headwinds
Despite a sequential improvement, management warns that industry headwinds in automotive and industrial markets may persist through fiscal 2026, tempering near-term visibility for those end markets.
One-Time/Nonrecurring Margin Drivers
Quarterly gross margin improvement was partly driven by revenue recognition for systems previously expensed or impaired, indicating some margin benefit may be one-time and not entirely representative of ongoing operations.
Extended Commercialization Timelines for New Opportunities
Advanced opportunities such as high-bandwidth memory (HBM) and high-bandwidth flash (HBF) are in early stages: HBM volume production is expected in FY27 and HBF/standards possibly a CY27 play, delaying potential large-scale revenue.
Pending Qualifications for Some Technologies
FTC plasma solution qualification is still in progress (formic acid method qualified and in HVM), which delays broader commercial adoption of the plasma approach until qualification completes.
Tax Rate Pressure and Macroeconomic Uncertainty
Tax expense of $5.7 million with an anticipated effective tax rate above 20% in the near term; management also cites remaining macroeconomic uncertainty which could limit upside to current guidance.
Company Guidance
Kulicke & Soffa guided March-quarter revenue of $230 million, a 15% sequential increase, with gross margin of 49% and non‑GAAP operating expense of $73 million, targeting GAAP EPS of $0.53 and non‑GAAP EPS of $0.67 (Q1 actuals were revenue and earnings above expectations with GAAP EPS $0.32, non‑GAAP $0.44, gross margin 49.6%, GAAP OpEx $81.1M and non‑GAAP OpEx $74.2M, and tax expense $5.7M), and said its effective tax rate should remain above 20% near term; longer‑range visibility includes an expectation that the fiscal second half will be ~15%–20% stronger than the first half, full‑year TCB revenue above $100 million, continued gross margins around 49%–50% for FY‑26, and high utilization across end markets (general semiconductor >80%, ball‑bonder utilization for memory >85%, China >90%, rest of Asia ~80%, Southeast Asia ~70%, North America/Europe ~80%).Kulicke & Soffa Financial Statement Overview
Summary
Mixed fundamentals: revenue is modestly higher TTM (~5%), but profitability deteriorated to a net loss and negative operating results (weak income statement). This is partly offset by a very strong, low-debt balance sheet (debt-to-equity ~0.05) and still-positive operating cash flow (~$86M) and free cash flow (~$79M) despite the downturn.Income Statement
TTM (Trailing-Twelve-Months) revenue rose about 5% to ~$688M, but profitability deteriorated materially with a net loss of ~$65M (vs. roughly breakeven in the latest annual period) and negative operating results. While gross margin remains healthy (~42% TTM), the company has not translated that into bottom-line profits recently. The multi-year picture shows sharp cyclicality: very strong profitability in 2021–2022, followed by a significant downturn in 2023–TTM.38
Negative
Balance Sheet
The balance sheet looks conservatively positioned with low leverage: total debt is only ~$37M against ~$825M of equity (debt-to-equity ~0.05) and ~$1.11B of assets in TTM (Trailing-Twelve-Months). This provides flexibility to weather the current earnings slump. The key weakness is depressed returns on equity in the most recent periods, reflecting weak/negative earnings rather than balance sheet stress.78
Positive
Cash Flow
Cash generation remains a relative strength: TTM (Trailing-Twelve-Months) operating cash flow is ~$86M and free cash flow is ~$79M, despite the net loss. However, free cash flow is down ~18% versus the prior period, signaling softer underlying demand/working-capital tailwinds than in the prior year. Still, positive free cash flow through a downcycle is supportive for liquidity and optionality.66
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 687.58M | 654.08M | 706.23M | 742.49M | 1.50B | 1.52B |
| Gross Profit | 289.48M | 277.92M | 268.75M | 358.65M | 748.32M | 696.99M |
| EBITDA | -32.89M | 38.58M | -33.53M | 101.20M | 498.49M | 434.58M |
| Net Income | -64.63M | 213.00K | -69.01M | 57.15M | 433.55M | 367.16M |
Balance Sheet | ||||||
| Total Assets | 1.11B | 1.10B | 1.24B | 1.50B | 1.59B | 1.60B |
| Cash, Cash Equivalents and Short-Term Investments | 481.13M | 510.71M | 577.15M | 759.40M | 775.54M | 739.79M |
| Total Debt | 36.98M | 38.55M | 40.96M | 48.41M | 41.69M | 42.99M |
| Total Liabilities | 289.61M | 282.85M | 296.15M | 325.22M | 393.95M | 506.39M |
| Stockholders Equity | 825.03M | 821.49M | 944.01M | 1.17B | 1.19B | 1.10B |
Cash Flow | ||||||
| Free Cash Flow | 76.05M | 96.36M | 14.89M | 129.00M | 367.20M | 277.26M |
| Operating Cash Flow | 85.73M | 113.56M | 31.04M | 173.40M | 390.19M | 300.03M |
| Investing Cash Flow | 38.95M | 27.66M | -138.50M | -91.34M | 133.80M | -81.71M |
| Financing Cash Flow | -122.51M | -153.07M | -196.10M | -111.88M | -321.19M | -44.26M |
Kulicke & Soffa Technical Analysis
Positive
69.08
Price Trends
57.01
Positive
48.84
Positive
42.09
Positive
Market Momentum
4.24
Positive
61.17
Neutral
26.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KLIC, the sentiment is Positive. The current price of 69.08 is above the 20-day moving average (MA) of 65.74, above the 50-day MA of 57.01, and above the 200-day MA of 42.09, indicating a bullish trend. The MACD of 4.24 indicates Positive momentum. The RSI at 61.17 is Neutral, neither overbought nor oversold. The STOCH value of 26.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KLIC.
Kulicke & Soffa Risk Analysis
Kulicke & Soffa disclosed 33 risk factors in its most recent earnings report. Kulicke & Soffa reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Kulicke & Soffa Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $2.52B | 21.25 | 11.74% | ― | -20.69% | -37.67% | |
74 Outperform | $2.22B | 16.27 | 11.89% | ― | -2.04% | 8.84% | |
73 Outperform | $7.34B | 133.58 | 5.48% | ― | 2.29% | -69.81% | |
68 Neutral | $11.56B | 31.16 | 8.67% | 0.81% | 0.13% | -16.17% | |
62 Neutral | $3.61B | ― | -7.19% | 1.77% | -7.38% | 99.38% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
55 Neutral | $1.40B | ― | -9.04% | ― | -4.50% | -45.79% |
* Technology Sector Average
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Kulicke & Soffa
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.