KLA CORP Quarterly Report for Q1 Ended Sep 30, 2013

Summary

KLA Corporation (KLAC) reported total revenues of $658.3 million for the three months ended September 30, 2013, a decrease of 9% compared to the same period in the prior year. This decline was primarily driven by lower product revenues, which fell 13% year-over-year, attributed to reduced shipment backlogs. However, service revenues saw a positive trend, increasing by 7% year-over-year, suggesting a growing contribution from its service segment. The company maintained a healthy gross margin of 57.8% for the quarter, an improvement from the prior year's 56.0%, driven by a favorable product mix and decreased service costs. Despite the revenue dip, R&D expenses increased by 10% year-over-year, reflecting continued investment in innovation and advanced technology development, crucial for its long-term competitive positioning in the cyclical semiconductor industry. KLA Corporation ended the quarter with a strong liquidity position, holding approximately $3.0 billion in cash, cash equivalents, and marketable securities.

Key Highlights

• 1Total revenues for the quarter decreased by 9% year-over-year to $658.3 million.
• 2Product revenues declined by 13% year-over-year to $501.7 million, primarily due to lower shipment backlogs.
• 3Service revenues increased by 7% year-over-year to $156.6 million, indicating growth in the services segment.
• 4Gross margin improved to 57.8% from 56.0% in the prior year's quarter, supported by a favorable product mix and reduced service costs.
• 5R&D expenses increased by 10% year-over-year to $132.3 million, highlighting continued investment in innovation.
• 6The company maintained a strong liquidity position with $3.0 billion in cash, cash equivalents, and marketable securities as of September 30, 2013.
• 7Diluted EPS for the quarter was $0.66, down from $0.80 in the same period last year.

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