01—Abstract
Summary
Summary of the 10-Q filed January 25, 2013. Cited figures are marked; the original filing is the authoritative source.
KLA Corp. (KLAC) reported revenues of $673.0 milliona for the quarter ending December 31, 2012, a slight increase of 5% compared to the same period last year.
However, revenues were down 7% sequentially from the September 2012 quarter, primarily due to reduced customer purchases of process control and yield management equipment, reflecting the cyclical nature of the semiconductor industry. Net income for the quarter was $106.6 millionb, or $0.63 per diluted share, a decrease from the prior year's quarter. The company maintained a strong liquidity position with over $2.5 billion in cash, cash equivalents, and marketable securities.
KLA Corp. continues to invest in research and development, with R&D expenses increasing 5%c year-over-year, underscoring its commitment to innovation in the fast-evolving semiconductor industry. Despite sequential revenue decline, the company saw an increase in product revenue year-over-year, driven by strong foundry demand and higher product acceptance in Taiwan. Service revenue also saw a positive trend, increasing both sequentially and year-over-year.
The company's stock repurchase program and dividend payments continue, demonstrating a commitment to returning value to shareholders. While KLA Corp. operates in a cyclical industry, its financial health remains robust, supported by its strong balance sheet and ongoing investments in technology.
02—Key points
Key Highlights
- Total revenues for the quarter ending December 31, 2012, were $673.0 million, an increase of 5% year-over-year but a decrease of 7% sequentially.
- Net income for the quarter was $106.6 million, translating to diluted earnings per share of $0.63.
- The company reported strong liquidity with $2.58 billion in cash, cash equivalents, and marketable securities as of December 31, 2012.
- Product revenues increased 4% year-over-year, driven by foundry demand and higher product acceptance in Taiwan.
- Service revenues also increased year-over-year by 6%, indicating a growing maintenance and support business.
- Research and Development (R&D) expenses increased by 5% year-over-year to $121.6 million, highlighting continued investment in innovation.
- The company repurchased approximately 1.47 million shares of common stock during the quarter, costing $68.3 million.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2013, KLA Corp kept $0.16.
- Revenue$673.0M100.0%
- Cost of revenue−$303.9M45.2%
- Gross profit$369.1M54.8%
- Operating costs−$215.8M32.1%
- Operating income$153.2M22.8%
- Interest, other & tax−$46.6M6.9%
- Net income$106.6M15.8%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2013filed January 25, 2013Financial Statements
Q2 FY2013 against Q2 FY2012
| Line item | Q2 FY2013Q2 FY2012 | Change |
|---|---|---|
| Revenue | $673.01M$642.48M | +4.8% |
| Cost of Revenue | $303.92M$272.86M | +11.4% |
| Gross Profit | $369.10M$369.63M | −0.1% |
| R&D Expenses | $121.61M$116.36M | +4.5% |
| SG&A Expenses | $94.24M$93.80M | +0.5% |
| Operating Expenses | $519.76M$483.02M | +7.6% |
| Operating Income | $153.25M$159.46M | −3.9% |
| Interest Expense | $13.43M$13.30M | +1.0% |
| Net Income | $106.63M$110.80M | −3.8% |
| EPS (Basic) | $0.06$0.07 | −4.5% |
| EPS (Diluted) | $0.06$0.07 | −4.5% |
| Shares Outstanding (Basic) | 1.66B1.66B | 0.0% |
| Shares Outstanding (Diluted) | 1.69B1.69B | 0.0% |
05—Questions
Frequently Asked Questions
What is KLA Corp.'s revenue performance in this quarter compared to the previous year and the prior quarter?
For the quarter ending December 31, 2012, KLA Corp. reported total revenues of $673.0 million, which is a 5% increase compared to the same quarter in the prior year. However, revenues decreased by 7% sequentially from the quarter ending September 30, 2012, primarily due to reduced customer demand for process control and yield management equipment.
How is KLA Corp. managing its financial health and liquidity?
KLA Corp. maintains a strong financial position, with cash, cash equivalents, and marketable securities totaling $2.58 billion as of December 31, 2012. This robust liquidity allows the company to continue investing in R&D, returning capital to shareholders through dividends and share repurchases, and navigating the cyclical nature of the semiconductor industry.
What is the company's outlook on R&D investment and its impact on future growth?
KLA Corp. continues to prioritize investment in Research and Development (R&D), with R&D expenses increasing by 5% year-over-year to $121.6 million for the quarter. This commitment reflects the company's strategy to stay at the forefront of technological innovation in the rapidly evolving semiconductor industry, which is crucial for meeting future customer demands and maintaining a competitive edge.
How does the cyclicality of the semiconductor industry impact KLA Corp.'s performance?
The semiconductor equipment industry is inherently cyclical, driven by customer capital spending patterns. This cyclicality affects KLA Corp.'s revenue and order volumes, as seen in the sequential revenue decline this quarter due to reduced customer purchases. Despite these cycles, the company's diversified product and service offerings, strong customer relationships, and focus on advanced technologies help mitigate some of the volatility.
06—Continue