10-QPeriod: Q3 FY2014

KLA CORP Quarterly Report for Q3 Ended Mar 31, 2014

Filed April 25, 2014For Securities:KLAC

Summary

KLA CORP (KLAC) reported robust financial performance for the nine months ended March 31, 2014, showcasing a significant increase in both revenues and net income compared to the prior year period. Total revenues grew by 3% to $2.195 billion, driven by a 2% increase in product revenue and a 7% rise in service revenue. Net income saw a substantial increase of 11% to $454 million, translating to diluted earnings per share of $2.70. The company maintained a strong balance sheet with total assets of $5.487 billion as of March 31, 2014. Liquidity remains strong, with cash, cash equivalents, and marketable securities totaling $3.027 billion. KLA-Tencor also demonstrated its commitment to returning value to shareholders through dividend payments and share repurchases, while continuing to invest in research and development to drive future growth. The acquisition of a private software company for $18 million in March 2014 highlights KLA-Tencor's strategic growth initiatives. While the company operates in a cyclical industry, it appears well-positioned to navigate market fluctuations and capitalize on long-term trends in semiconductor technology.

Financial Highlights

50 data points
Beta

Revenue

$831.60M

58.8% Gross Margin

Net Income

$203.58M

24.5% Net Margin

EPS (Diluted)

$0.12

Total Assets

$5.49B

Cash & Equivalents

$776.22M

Free Cash Flow

$219.51M

Financial Statements
Beta
Revenue$831.60M
Cost of Revenue$342.83M
Gross Profit$488.77M
R&D Expenses$134.16M
SG&A Expenses$93.45M
Operating Expenses$570.44M
Operating Income$261.16M
Interest Expense$13.40M
Net Income$203.58M
EPS (Basic)$0.12
EPS (Diluted)$0.12
Shares Outstanding (Basic)1.66B
Shares Outstanding (Diluted)1.68B

Key Highlights

  • 1Total revenues for the nine months ended March 31, 2014 increased by 3% year-over-year to $2.195 billion.
  • 2Net income for the nine months ended March 31, 2014 increased by 11% year-over-year to $454 million.
  • 3Diluted earnings per share for the nine months ended March 31, 2014 were $2.70, up from $2.41 in the prior year.
  • 4The company maintained a strong liquidity position with $3.027 billion in cash, cash equivalents, and marketable securities as of March 31, 2014.
  • 5A strategic acquisition of a private software company for $18 million was completed on March 28, 2014.
  • 6The company continued to return capital to shareholders, with dividends paid totaling $224.4 million for the nine months ended March 31, 2014.
  • 7Research and Development expenses increased by 11% year-over-year to $401 million for the nine months ended March 31, 2014, reflecting ongoing investment in innovation.

Frequently Asked Questions

For the nine months ended March 31, 2014, KLA-Tencor reported total revenues of $2.195 billion, a 3% increase compared to $2.123 billion for the same period in the prior year. Product revenue grew 2% to $1.716 billion, and service revenue increased 7% to $479 million.

Net income for the nine months ended March 31, 2014, increased by 11% to $454 million, up from $408 million in the prior year. Diluted earnings per share were $2.70 for the period, compared to $2.41 in the prior year.

KLA-Tencor maintained a strong financial position as of March 31, 2014. Total assets were $5.487 billion, and total liabilities were $1.847 billion. The company had $3.027 billion in cash, cash equivalents, and marketable securities, indicating robust liquidity.

For the nine months ended March 31, 2014, KLA-Tencor used cash for operating activities, investing activities (including $54.4 million in capital expenditures and $1.156 billion in purchases of available-for-sale securities, net of sales and maturities), and financing activities (including $224.4 million in dividend payments and $180.7 million in common stock repurchases).