KLA (KLAC) 30 Oct 242025 Q1 Earnings call transcript

Good afternoon, everyone. My name is Lee, and I will be your conference operator today. At this time, I would like to welcome everyone to the KLA Corporation's September Quarter 2024 Earnings Conference Call and Webcast.

[Operator Instructions] I will now turn the call over to Kevin Kessel, Vice President of Investor Relations and Market Analytics. Please go ahead, sir.

Bren call quarter the our outlook Wallace, our earnings and XXXX CEO, our and December the I'm CFO, to to September discuss results Rick Welcome Higgins. joined by

are released specified, non-GAAP We will on to results. along references all a metrics full the with detailed non-GAAP future the and most a reconciliation filings, quarterly to Forms make and and close materials. also corporate of discussion presented contain and reports including report year ir.kla.com IR materials Today's contains XX-K KLA's after to GAAP XX-Q. investor supplemental are governance discuss The earnings website information our available the market presentations, basis, events calendar annual on results years. today's and on unless we recent links SEC otherwise

are the in cannot subject filings. we forward-looking today will are call uncertainties comments our disclosure statements guarantee forward-looking today, of subject make statements, to true. and SEC and factors come KLA including those those risks, in our Any risks reflected those Our on to risk also

Our actual differ results projected forward-looking statements. from in those our may significantly

and Rick some with highlights followed introductory our outlook. by will financial Bren comments, with start

NASDAQ our CEO, XX, XXXX provide in Before I the our site. the of June Wallace, It on market morning the call over safe will I New wanted Day. turn City to to Investor Rick to a XXXX for date be at held York

will We closer details the provide more to event.

Now Rick. over to

GAAP the billion results with EPS strengthening expectations $X.XX of All non-GAAP came delivered by global exceeded our guidance quarter ranges. of end Thank and $X.XX EPS $X.XX. in you, of of execution Kevin. outperformance relative team. KLA customer at their and diluted demand solid upper exhibited diluted and September continued Results revenue

growth remain of for continued signs logic improvement steady we customers, we and memory and our strengthening the leading-edge expected, are encouraged in in and confident our environment by for the XXXX. top As plan

new including development strong intensity revenue to to equipment a double-digit logic, long-term rising secular return of highlights, In foundry number the supply-demand continuation a high-bandwidth saw tailwind. AI and the be growth growth. wafer of year-over-year capital sequential of Quarter makers and technologies and slowly environment memory, and incorporation and continued in improving positioning for are In XXXX. memory fab memory an industry investments supporting technology scaling

advanced This to and CY we KLA's continue quarter in in customer confident in category and grow 'XX of remain million that packaging continued adoption exceed will to growing demonstrate this $XXX revenue CY 'XX. portfolio

CHIPS our an We Growth important also in business. as meaningfully. of demand intensity, enabler driver benefits for process continue see control to and AI which AI supports KLA rising

leading-edge of service sequentially ownership KLA X% to an and XXth grew growth Daily performance adopter and was on incorporating our consecutive the million XX% quarter our products using to our leverage the September architecture AI of to year-over-year AI improve and leverage basis. early making in cost enhancements designing a product of up business $XXX will Additionally, quarter, systems. in GPUs. into customer and future this year-over-year, KLA's the computer

and flow cash returns cash was million. a flow capital $XXX from strong was Quarterly quarter September perspective, the Finally, free

last $XXX Total Total XX quarter and was over past period. the capital same the return repurchases cash million the $X.X XX Over share over XX% $X.X return million billion dividends. the flow September flow margin $XXX cash months in $XXX was free comprised of months, capital in billion. free of was million, in

over relative operating the company run. We model the sustainable for industry long are the to confident well positions the KLA outperformance

to will the call I pass now to financial highlights cover Bren and outlook. over our

was Gross than team. in as $X.XX weaker dedication midpoint Quarterly $XXX the the $X.XX $X.XX, with billion. were range was was was of Operating diluted diluted the the XX.X%, of midpoint. global KLA both market Thanks, demonstrate $XXX results Operating million consistent above guidance Non-GAAP product $XXX our modestly $X.XX EPS expenses billion, quarter EPS systems was Rick. R&D and the September guidance and was combined SG&A. revenue respective leadership, execution and mix guidance of were above below expected. million comprised the margin in slightly of million, XX.X%. midpoint margin Operating expenses GAAP

was end Other GAAP income and the revenue was shareholder $XXX effect investment. and cash attributed flow was and million. and be expense with tax was net slides. rate quarterly letter net operations strategic from reportable a major The $XXX the Cash $XX was free from XX.X%. supply by expense Quarterly million downside non-GAAP can to The of mark-to-market products the and regions effective was debt million, guidance $XXX income income million. million. the And breakdown markets, segments flow within $XXX of found

X Moving and sheet. of ratings KLA quarter bond balance to $X.X debt billion ended a flexible attractive in the major the agencies. profile and rating all cash, billion with $X.X supported by investment-grade total from strong maturity

the decline levels in retires its the at XXXX to Our debt quarter expected December are November as maturity. bonds company

our positive our outlook to business. outlook the term, near Moving in for industry the remains

consistent the of articulated Our is we also year. quarter-to-quarter views the with performance beginning at the

billion peers supported recent is year based announcements, internal from range our for analysis results and customer customers. 'XX, our modestly by and increase reported for the mid our the expectation across to to market high on the guidance calendar the For WFE of $XX calendar

mostly on perspective from XXXX we last articulated expectations is calendar unchanged Our what quarter.

[indiscernible] will as until do fueled and overly principally equipment in calendar both offset made investments continue not China customers year another the specific expectations growth by of growth, couple we by of absorb year years. demand next January, the foundry, and in over While on for logic we past report memory, be DRAM, lower expect investment to leading-edge we

and higher process business across expected edge momentum, at intensity segments. share opportunities KLA's leading market Given the control all

market We can outperformance are our WFE in XXXX. confident calendar relative we maintain

the to is Non-GAAP gross control XX% be be scaling systems customers XX% points the quarter to approximately and as and mix KLA's December plus segment to at from X or revenue to make we is expected revenue forecasted be Within of product million. semi follows: on memory, to Non-GAAP be and be revenue NAND, as is point. percentage important expenses basis $X.XX semiconductor are mix to process to higher minus more expected Or midpoint margin is billion, favorable memory $XXX operating sequentially growth. revenue forecasted in revenue or and approximately December expectations. is remaining Total logic approximately be support to quarter customers. guidance XX%. XX.X% up slightly million continue XX%, DRAM minus Foundry investments to semiconductor is XX $XXX the R&D expected expected about forecasted plus

and diluted we December balanced for quarterly $XX product a and run. is supported Other $X.XX operating other plus income expense of spend of non-GAAP over count development of incremental EPS be expenses million our model or the expense. to is include XX% million incremental growth approximately plus debt EPS or share minus million $XX and business requirements, the long over next several GAAP Looking in map minus operating diluted expectations expect margin quarters shares. fully on leverage based XX% XXX quarter further $X.XX. to guidance $X.XX diluted non-GAAP against approximately road approximately $X.XX, expected EPS revenue assumptions the and ahead, by our model

what financial to at guiding strengthened XXXX. the and flow focused quarter product expect performance new integration also market edge and our time results KLA's the enabling annual for third industry-leading advancements. importance our and growth remains manufacturing revenue differentiated control in are increasing confidence in relevancy and KLA technologies is that on conclusion, free an optimize to just rising The continue mix. of and capital leads device and In high-volume semiconductor This process have road we consecutive allows us across leading consistently. drives but operational differentiated of to of an sequential portfolio to expectations. delivering environment not technology scaling for a new addresses design at longer-term requirements calendar that demand with drives yield semiconductor on customer delivering return excellence growth and and map solutions process success, complexity customers' cash our growth return and fab technology and high to focus improving innovative improving ramp,

lifetime In industry KLA's promising. and and demand is this, KLA's and with secular long-term tailwind. demand is long-term business expectations performance customer of alignment growth trends business In for industry addition, very favoring well continuing its outlook and positioned bodes our increase system long-term This service increased are to availability continues improve. WFE tool well relevance growing a the driving are for semiconductor to increases and KLA investments trends in

That remarks. concludes our prepared

the begin Q&A. Let's

you Thank Bren.

and Ladies gentlemen,

I ahead, say operator. going just instructions. Sorry, the please provide to go

Bank go Thank you first today to Mr. America. Instructions] [Operator Vivek of We'll Kessel. Arya of Certainly.

with the spending. of want that spending, next of edge, leading lot I'm but but do leading the how want we increase that about excitement payers curious, the square cut to a X foundry only to to the there's fact

spending drive is this Is or TSMC to it So increase desire based good this to double-digit broad-based? for. investments by just excitement. so Or that just X it I looking is everyone is was is pace on the foundry's spending? up enough curious, leading-edge

It's customer Thanks, the question. foundry question. for not a of a the foundries It's question.

the -- the leading XXXX. the indicated of spread we anticipated significant year what be right seeing pretty obviously rest now, the for call, demand they above is them. us suppliers leading additional I think what across X-nanometer also one fact And some as supplier edge, a think of to anticipated. that there forecast bit their be edge. of were lead X-nanometer but -- into more in would there's they the strong, for demand through they there's the And if business would and in But they're I demand to this bookings that robust

players. think don't number the I it's function a of of So

as both I seeing. And fastest-growing training trips, players inference really it's chips, I segment, demand we're additional think and and that's AI this you demand for in not driving mean, across a that's it's of just because also support. but it's number that know, is driver. a the

approach the Vivek, we want thing picture. close in enough they we're severely But the and ways. to sure have understanding And control we close overall I and customers, generally, add good them all a of process that make collaborating that a different other demand is to our pretty to would

our So that of or in demand that satisfy we that the is terms demand assessing what expectation. good doing we feel that have think we is going they're customer that aligned articulated, supply Rick in supporting of with that that each to terms

the about That's you in And just product or China expecting overbid. question dissect December? be services? are in what is How can How the And exposed a September. follow-up, much -- in maybe is for potential baked what's how what on resilient much China? restrictions exposure might very for or question you or much XX% helpful. any your is, is broader Curious my to exposure, maybe

the for it's on on whether China several a about Just it's how basis? think do of next basis quarters, or you percentage an sales absolute whether

were 'XX supply Well, Vivek, able into our moved fabs and to react this that our and of long-standing because put back what non-China was go to understanding that more on 'XX projects. dynamics. of to strategic strong we important new in lot produce in supply orders So if a effectively basically China in customers. to it's up. and were from It being 'XX, we had demand right? limited and keep what 'XX activity year, you right place lot it focused wasn't a and greenfield our and was XXXX, greenfield, necessarily 'XX, now took starting 'XX, we to for we that demand happened And constraints customers in and context other as

funding And from to meaningfully. our other a and able it so those 'XX available, back customers customers fill that 'XX in step pulling pretty was in and came were while void

it it's looks And see at before, the you of somewhere the 'XX coming so like at -- for we ]. look been look a we would to into for [ thought the couple down And is the [ low fourth so as mid-XXs we elevated I If down. I then quarter. at fourth it come it's XXs if elevated as percent in been XXXX, look So quarter, ] levels at years. said the

As a percent.

look going point market. expect to somewhere that next minus or year, some view, a a just so not various the of mature to so would the of I'm less service down into saying, next from a plus into a couple service moving I And than year, forward. points we aspects when digestion mix expecting other of from around get it's to drop or XX%

So than average of service as percent sort revenue. of percentage percent is a a lower corporate at

that's hopefully, say that's So I'll But front. on helpful. all that

how in question it export As if year been relates much. when over now and a and we've getting to terms controls, this of for

And it. there to out so the hypotheticals want I don't to speculate about how that on are think and

anything with we'll we more something for So to if have don't if than now, on and impact, want that. But we'll happens, clarity, I share have to more assess the once you. speculate

We JPMorgan. go next now to Harlan Sur at

job On on comments XXXX Great execution. quarterly you're year. on qualitative calling the your for growth out view, the right, next

relative that revenues view assume your You to did previously. XX in China spending, your on dollar maybe next stable total terms ago. new of right, versus much change not said lower I out year, days call you

So downshift logic the that being and demand should better strong offset trends on advanced foundry interpret the Rick China we earlier? by more articulated in as incrementally memory and than on spending

Yes.

as bit, said not a to stability, I go view maybe just we started clear. a be was a down ago to little think of what it back bit, going we little quarter a with but that -- you up

we expect to. it's by we demand that be offset by leading-edge it where the sit would that down some, Rick referred I being and will think I today, think

So haven't overall, our really views changed. on 'XX

think Harlan, you we're the number. rate 'XX, rate keep Yes. talking that I mean, for if at about exit for you a -- is higher if -- that that that's QX about

a be could at level dollar have China you percentage. similar lower So a but

and process on it. inspection year at look is up X now business, right, patterning your I If year-over-year. XX% ago, then control a XX% inspection first right? versus Got months and up And this, within year-over-year metrology, wafer

intensity next strong over as into given -- months year, calendar first your period Patterning, next way sort this into the like growth you distribution, very backside time. metrology, of advanced anticipate very, things right, memory, same the So on business Patterning for But about around, like we X X% metrology looking of power year? metrology of all to and see increases plus down right would acceleration that gate patterning move of year. an

purchases you're is closely you're the tool Yes. monitoring overlay linked because That's current view. our very films, Metrology monitoring and on. to process so

up investments. to scale So down and capacity with more patterning tends

I think year part you're reticle given to next of increase going the expectations also see well. for the business. design starts, as

in that well. that given customers expect that of the is have pick to market course, And inspection our we've up see of of challenges metrology the offerings in would the we'll of been obviously, inspection this in next fourth I a into some starting here seen where advanced into in for inspection quarter. been What's packaging, So then, of lot growth part and yield an inflection year. driving as reticle activity growth facing,

some to that's been So incremental a the driver for patterning. of growth relative of inspection

Yes. thing, other One Harlan.

that times I phenomena constraints didn't have think business. we at if in on metrology. the for look more such were really you subsystems gated of optics inspection capacity lead that as

said to production. So with Bren more those flex tend as

for it So the increasing to we still and have comes BBP good environment demand when platforms. an us. backlog

coming to that on So growth we're lines capacity additional so also to that, product seeing XXXX, BBP the allow grow. support in the will

We'll Joe go Fargo. at next now Wells to Quatrochi

intensity process to think just as you share really was sample capital we X-nanometer? there the can wondering and control. about any about color that you Is rates how X-nanometers think I'm I there

Sure. what more is to seeing and What is what we squeezed further. are process process windows we're window on a we're -- right little now expected on being X the bit even there's seeing

So there points added. are more inspection being

So inspecting, when are how about steps are up. those going the think places that and we many people

there tools you that more like from So it to not go but increase might that happens of X, number places EUV with for it let's we and to the What some associated say, is, you sample. have layers, dramatically what the take. part is have analysis are increase of looks and you run a where will example, X

then higher even -- different it. you looking number settings, capacity you're when in need have more at you means you you so at initially, defects, ], looking support but vivo [ might you're be see -- a So higher which to sensitivity

So we're we efficiency. when on we that, our fully haven't looking work customers because quantified actually with for

at to But sample during I you ramp frequency in ensure the debug are what stability left So be higher able process see have that is then expectations at -- initial with that and higher, you to systems seeing. to the configurations, is levels production. X-nanometers process and control that's driving higher seeing intensity, we're with trend that sampling more what more and be higher will we're more a

for The what's a more there mentioned, as sampling -- at they're higher well. thing these advanced higher if think to are other is, mix Bren more designs maybe and ago, drives need you more about higher because imagined, going than as we years be coming, few nodes so might have a variability, mix there's

the control to of intensity of Joe, So or When with high go share tends process local that on [indiscernible] we WFE. architectures saw to architectures. KLA back last process it drive change, you control higher,

we as opportunities will on and requirements transition a there film layers create architecture, for view, not of patterning creates a here other deposited that So us new it measurement point more additional are to metrology only from the side.

structure. because new mechanisms have the also defect of You nature of the

So these hard you varying over, that's left to residue where have inspect. very that's there's defects,

new X so defect around introduced or And for type. very gate all we've that capability specific

an And would in we to increment to transition. there node beyond so see node there's normally what of expect a opportunity

So opportunity of what's can there's a And we lot encouraged feel of by we front if very in execute, us. there. out

that's helpful Well, detail.

growth half think half seen kind we in of the in we've similar of growth like think versus first of how first I half-on-half, 'XX, think second that? past, I How follow-up, us to a half as half to look guys about XXXX. we And half? about into kind help should guess first second about we levels should be you half-on-half as the try As versus thinking

as environment stable from Rick's we say on the a based expectations current our point, Well, forward. move I would that earlier rates run pretty we see to QX, into

our for about March out report good lot this have get won't the we on 'XX the when At a as to say today, very half. the overall stability business. point, the we'll certainly, more I levels quarter rate and of quarter I at the about feel into But we December and run January. views So look full the

C.J. We'll next Cantor Fitzgerald. of now go to Muse

at into about some last And from advanced where And in talked seeing you're strength to sequentially. up expected current fell on from QX. that business maybe actually Taiwan logic comment mass X currently the and I moving like your It looks when guess stability March. follow you quarter, is and about look Intel. I rapidness business in packaging. good foundry HVM your believe question into I

the of XXXX. logic would seeing foundry your you I you're -- a speak perhaps would thoughts? China. to that breadth So offset a in that think to to can slowdown hear Would love early And complete be

-- but I say Yes. start ramp the normally, volume in -- see given given first I'll start this, to will to leading normal ship that executes the customer our those would against the just part in expect, foundry schedule year. of the you'd

question margin Okay. you. And process you a margins gross attribute in Great. for to maybe bps XXX looks that dropped mix. It semi then control sequentially like and gross September

look -- into remodel rate forward, of And that we should about margins should through we of how run So and those think kind as normalizing? kind what we XXXX?

Yes. Mix a me. for is always C.J. factor,

market. currently, stick selling say point of that. variability longer cause at opportunities of end you lower a incremental. over tends packaging growth But But systems margin look it XX% periods the some great into XX% part a The closely to about of suggests we're can have mix So the pretty across from movement view. I incremental our been it quarters. would model time, to opportunities that normally, to if that

the encouraged for there forward. So need affecting a although moving about we're it the capability trend more for bit, the mix is

in kinds here I XX.X% those it's I'll this, that issues. call it, say So would we're range. operating of

we as that I best that rates, we're forward. of I sort run do. move probably year, think likely north of south next into current at route as we to project versus be out That's of And can the

We'll go Tom to Barclays. next now O'Malley at

specifically on I market. to just ask wanted man the

what you're a but equipment year 'XX historical low there's and potentially moving in right that a calendar normal are where you capacity coming a and transitions guys out now into bit NAND So means technology is from to about debate perspective. an of off really if look September, you where base for

just So you I market? customers there? seeing broader guess are of look any Are the Are first are comments is, NAND growth what the year? maybe be your intensity seeing NAND upgrade kind one? Or would on the pick that well on seeing question take that up into lines? you you the market to you expand what driving technology as in seeing is next And

at Well, a pretty low base.

about next things get our a think year, customers what rates is Mostly, better. some expect again, year, base. like seeing as investment So we're improving would inventory but utilization we We're seeing very of off financial that. next low improving performance, levels, we incremental

absolute basis, that think investment we next a a translates dollar very it we but are coming is it into into year. off on level. really So see operating some low but growing don't lot an

into we're incremental . So some I year. next think business there as optimistic on move we

DRAM technology other the intensity compared to we're But Yes, one process bonding. trend for control that really wafer wafer will to the pushing technology logic. the is not than NAND or help that,

Super on you. just side. advanced second And then helpful. is packaging Got the the

You spent amount accelerate. decent of you're the last move topic call hybrid seeing on increasingly, time on think and to of talking bonding I kind the guys a the

in today you size some down. frame. just are try some of the you of to of and that So could saying business But XXXX? opportunities opportunities kind XXXX seeing that -- of others reaching like you're kind And the are time shape

areas you of already, your as be comments but are competitors about would well? smaller Some -- talking those some seeing there in kind of any of helpful

time it there, development from have activity as the any to move memory bonding hybrid frame. to at high-bandwidth you of the until a 'XX, expect view point least 'XX probably don't production relates Yes, into but we

requirements. you do bits you create opportunities also not only reliability of control trends memory themselves per driving we're devices some in mostly terms us terms of HPM on of higher although really side, by wafer, because encouraged have for trade seeing business the the higher the that is we're But what's logic in opportunity. will. process have the So you part if in of silicon

got the You has to you've be logic circuitry had the processed that die. stack

encouraged we move So there's lot a that as are forward. that opportunities we of within by

of one what And step. business you So metrology I is inspection saw what we go by is cost much wafers solar, relative step there any of high. to the at opportunity just never for best making our truisms wafer the the were that of mean if support being cost the because back is inspection. for the inspection cost they and much very time of the it the not so couldn't in in is

You biggest go to the the high is so other money failure can dynamic end of that inspection the cost higher of a much step that EUV of and there's level you higher level lot have the cost need and in is reticle relative is and on capability. spent that changed of The a high, the the a fact cost much the of so that for advanced cost support an of packaging inspection. and a

about inspection, several our challenging. because years, That our but to driving think to And much part dynamics. you play product intensity high. you And risk already about a and customers, what's need to portfolio is the that that came about go because back in us are did us much at challenges. those it our of some into higher and and So market. more the level when to that failure our seeing out we're of bringing view down talking big recognize investing more there got heavily these of of so to ensure is earliest that not market moved of And they're next the those over indication for if clean for was we our customers so those has started cost what's steps And capital they think HBM that. evidence that's the will early front-end because the end of tools

go We'll next ahead, you. Pajjuri, Thank now Raymond Srinivas to James.

if of NX NX just tracking I'm so, if you question in more demand. just original And So also you're upside line terms expectations? in coming NX? seeing is with said strong. curious near-term is is the both my I wondering, them were know that -- from on NX versus your of

of Yes, the this NX. I what seen shipments is year upside. we've see would to been very the for some say investment quarter billing this over what's half has driving of [indiscernible]. course that starting NX more of year next We're most And with second

it. wondering as you your That's maybe general, China can to visibility, Got go just as if in then and And comes on year. your we impact just RPO down bookings level that next speak has Okay. helpful. of the especially I'm forward? visibility any

so December the and further Well, to in the it, on has flattened was or RPO bit you'll probably flat report it out but a less quarter next expected we'll or little specifics more quarter. quarter-on-quarter see the

would general, have I So say in that, coming in. lead times generally been

the some urgent. earlier the gets greenfield Some less It's really you for I to would some that of some see supply on greenfield will new mentioned pull round or ship projects actually to the digestions get happening. of say can has in, projects start demand. pulled that so that we've earlier, capability to into as as of second is -- to of right? that Rick back we tools had some of It been, We're constraints that some start cause supply queue new those some need the waiting supply the as relative to

show Although when you want and new time. will sure and have customers, they commitment so want to to typically delivery they

orders for ahead. try So typically them to and further planning they'll make sure we're give us

a general, the in we and that around see generally move it's times say, RPO seen through starting tick pulling looks as into bit, to progresses would the and of turn how I lead we've are now this down, quarter rest like but it year. So in, next

at now you, TD to Cowen. Krish Thank Sankar go we'll next

clarify Brent. something, to want I all, of First

but You revenue same. I'm go If to dollar next out be. is sales to year, your China think remains pretty trying of mentioned then to to metrics? figure WFE about A, so, what XX% compared true? still that should to is expected grow could X the XX% how that strongly from value just overall those

Yes, be It I think bit I the the it we'll expect see plays it's out. less. could But down. Look, year a could be how same. a would trend little

say to trying have been is earlier were we what investment stable. pretty think I levels that

how So out. half difficult bit from second it little the here. we'll into the see It's of a see 'XX to plays

So are next from moving of give sense I we was year you just trying as see X% directionally to where the some overall. things of

ton the Got know it. just mentioned you sense about foundry demand which of of makes other Or Got XX%. is kind to it. past, kind improving And up it edge, in on China. thing. DRAM the And most to going also clarify year? one I how in in this from a of already the is then Is the as incentives leading I control of then mentioned XX% -- side, next that from year? you think process baked helping

No, it's certain from I relates a momentum opportunities for helping. memory lot particularly There's customers, and to as DRAM us. that's it of high-bandwidth creating advanced think

encouraged control see we we're said an is and -- encouraged and stronger that relevance expectation before, earlier, and to expect to in said year So see by investment more I'm I with as process of KLA DRAM next ramp.

So I of and if the inspection. what my semiconductor value cost -- go about of comment the to the back

trend packaging. for playing about definitely AI, in DRAM it's out If in think you this and

and wafers redundancy less technology. that it's in So they is die. It's critical, DRAM are larger a have are have more HBM These to going for more them. the EUV Right? more expensive also

to the what those our intensity around control. factors is customers combination will drive So of their increase process

-- printed a to verify the and dedication EUV is good is a prints. have success it to the significant our [ with a been using of pretty Has a as application we Gen on EUV having reticle of Gen of BBP. part X Just ] X that driver example of

for going So overall, don't trends point. DRAM, if it's think the we about trends know this very positive to out quite but at are you the advanced play how

go now We with to Joseph next Stanley. Thank Morgan you. Moore

of just we much might And hear of next you get that I around -- as want when don't surprised. to giving On there controls, kind get that like lower a of point? is and I conversations by said until where I'm for how how the conveyed? export versus hearing they time much of you preliminary this it just had speculate you framework work topic entity what sort year, sounds you're might guess, you're had framework, we of focused do it. list an is informed that do you you this at a more be guess expect Have to

X multilateral, they Well, if but process, of own think agencies They -- their for years they're places. person that ] was multiple government to players. to ago, itself, There's not do also notice, back or [ to XXXX decides. other the to their they're you have involves and talking trying the go I a go when group which across number through X reconciliation X own some so there have

nothing actually truly And get it's until on think going I when decided announced. heads that's much up don't to is we So happen.

but So last keep we times you that's written, in speculate. have that's why we all saying that's X the know, can't read we right? thing would -- been if X happened written There's plenty don't this months, been

clearly, to So it is something get causing not decided.

hasn't our And in changed, so comes are when speculate others does. it companies to said, it's where what was. than line our and on forecast XXXX going When more not I for it have now think it with what much peer we're to

about in investment kind changed next and forecast view environment year. really last for has envision there's going changed. the customers So to has we as our we not our what of to be. several talk Nothing months our

very China elevated. is And My catch-up causing I helpful. it were the be foundry DRAM [indiscernible] to is perception that you kind know at side business, then fact that driven on by your had -- point? more this of That's within DRAM

of But bit, down be to of overall, were a terms the to up would less think think investment going forward continues, be in a parts was I more to down we DRAM memory, general, you the happened. statement adjust modestly radical more to some I memory in access business, memory less started expect I little logic. to, of what yes, or market as to there terms it's our I catch-up And think I foundry yes, be infrastructure than moving would expect fairly that of Joe. asking but strong. still break You logic don't have to there statement. foundry versus was in but about a but that's And wafer more

of Thank to you. Shi now next Yu go Needham. We

all headlines for not also the the out X-nanometer of talked this at remember first quarter but a ago, look but year about second My question. just we'll customers year, X-nanometer half I next X about you your done, large is conversion rule the actually X- out but X X-nanometer next not that of there upside they to leading like from the X-nanometer year. customer look the did doesn't X for that even more or

So XXXX the you the given upside here? seeing still for my question really current are is, X-nanometer visibility

to than question said X-nanometer there's still the X-nanometer been big we next to would [ call. anticipated into but ] a be And be earlier So activity that year, stronger continues expect a months But we in ago. we X as strong. this is X-nanometer earlier, driver yes, we had

you driving North color, like or uptick of North reported The like quarter some if make quarter? number America. years, high. you pretty it's go thing X revenue probably on the from it the Might in some I provide back America seems maybe big last September clarification to to I that looks ask September probably your revenue want for you a what's other highest provide get color the the

Yes.

stronger was it edge it's that. say centric. So leading more and I'll

next go Citi. Atif to now at We'll Malik

is different First, your inspection to that in believe big I a and business that from business because restrictions? is on wafer China, facing peer reticle it bit understand are your China maybe possible how

Yes, exposed We're it it is if is right? those different, to investments. --

actual of between over been disclosed and would XX% systems amount, haven't say couple business. I the of somewhere I We would China it's last the our though. XX% say, years, But

but customers. the is decent, it's preponderance, obviously, So semiconductor our

of services out an expectations will the services the business, you down on impact your on XX% like scenario Brent, longer growth be then, given there of laid demand term? XX% And a Understand. China to coming

opportunity, and and new demand. high we end levels, that offerings new generally life within ASPs value tools to Well, and model the it, dynamic part conversion service We're service That's terms that at out, course, we're end. bullish than of life. but service really higher, we're seeing the useful useful have the trending the our range extending the driving pretty also rates, is service And are top shipment that bottom growth. closer service of going of incremental which of on drives pricing contract trends in and

high said low-volume redundancy. high So as business. mix, before, of complexity, it's relatively lot it's There's not a -- we a a

run have have Customers the uptime matching so the very at levels. very they high requirements expectations They high across tools. tools and

still tools there customers of plus revenue. and which are depending that the the FX, But So in dynamics as And and businesses revenue of model affect if drives service you a ears there. is they're that drives versus model the long-term service we those eyes the priced of the and did we're control, local that, operating XX% stream, currencies affect towards these that end in feel with can feel opportunities around have the very that comfortable like our ensure so are net-net, on service trending the yes, line. fab. And high model contract low controls our end. result And some

We go UBS. Arcuri Timothy next at now to

a as and waiting announced much of you they look all, Rick, once I it not base look Or will what to case really and to the assumption handicapping It impact just like, for assumption making you're will sort Lam does. export Is about for base was explosive have They sounds for as are and like exports that's handicapping then the it that it's control. the you? that's doing to you're guidance. to your a want like? pretty much to be our get at handicapping as for me that clear fair? announced, kind that how guidance Because and numbers Is it going gets the you're are. what to it of just not

take Tim, I'll the so part. Well, first

that of to issues terms And as of have as contemplate that how quarter. range. we all all we the of an I contemplate view guidance, the range so scenarios, From provided have quarter, thinking relates we're and on. it with the we a tools we're scenarios, our ASP the course, as various about guidance of we and energy fourth So comfortable in size the we and would guidance point the for say

how pertains something what what the forecast, do to look long-term on. not terms of may of means it As and so it have plans that and assess backlog, impact we those or at we'll investment happen, to their what we customers in may have in

So we a detailed happens. near feel comfortable we guidance something as guidance, range we as relates But the it have happens, it to think with I far term, information won't if until provided.

on math just I Okay, Bren. guess Then year. next the

Of X be to XX% WP's And films year barely China about going you your year. is tiers, X revenue up like China XX%, So up the grew mid-XXs. this mid-XXs grew your for this revenue, think I it's other up.

-- lot a so what you're up you're are. So peers than more almost

about think China doesn't when But So Chinese you grew how available of I matter what it any you your from China think that's tool there's WFE versus there's maybe pull is. peers, mastic you a think China because your no spending fast do alternative forward company.

up as So why stockpile to move these entities came around new them consolidate. degree tools some not your and

just that a the think your wondering I'm severe than for you could if more peers? So hangover you little be

timing. of terms in patterns buying different there's Tim,

look peers. you our business I If at China XXXX, -- think we undergrew probably our

companies conclusion, look investment general of at 'XX, I mean to levels really in been, I drive might at Because a time. sampling. across you have early isolation, most the that think look doing on. lot a year tends particularly and think activity any control relatively you customers monitoring I greenfield get of Process if X not if broader in are of consistent you So it accurate. 'XX very heavily adopted probably very, I think, a period to have more closely,

as wafer So then bit. to process to start diminish starts grow, tends a control less

but some the there's we given . they overall. 'XX, So And are of we'll earlier in today, 'XX. overall comments, we and do where how digestion WFE, expect in buy probably timing to terms some what see in

next Goldman Sachs. Toshiya go now to at We'll Hari

for wanted to thoughts mix get any margins. implications and I your on into 'XX customer going

and obviously, share next within within is growing well. year China mentioned TSMC down share as WFE foundry and You logic, leading-edge

decades. your So remarkably does been many, gross if I many margins? that profile -- gross pressure or know stable not has potentially could years, over maybe margin that

So do I a we this but doubt it, from question get bit quite investors.

for curious in evolution how gross customer and about thinking So you're margins? mix implications

Yes.

are product It's margins Our dependent. specific. customer gross more not

in tend more beyond that isn't different don't to volume-related incentives, buy between of volume terms real margins Obviously, get there customers or incentives. across customers margin. difference our obvious between overall vary customers. But regions So any

control buy strategies. all process at and they differently Now different

same. our different so carry they're all And the not products all of margins,

regions. one mix drive products of factors that than tends it's the product customers to So more about or But that's there. variability yes, some

account hoping of Got you know it. as China. to of customers And was one side. on context you some follow-up, year? process quick Customer a service suppliers your guys groups type. tool then wafer of And total I you percentage of trends what you a as curious broader peers. like into XXXX, I'm more by a infrastructure I look are give customer little application kind expecting? forward more this those the what match us for shops, bit relative China another on or could range

be And call, Yes. maybe 'XX in high would I view, the that's than stable, somewhere mentioned a is XX%, reticle as the on expect [ percentage in but given year. of that in But as an Earlier mix. to ]. point I about probably the strict general, more XX% wafer infrastructure from mostly

that's So there.

mentioned think we memory I earlier.

due to the the just meaningfully to of investment for access that comes have to memory investments down lack due happened us. market think memory partly I some partly

-- then and foundry I think much. corrects, correct and doesn't but that logic all . So

We go Chris Research. next now Wolfe to Caso at

of a of kind significantly. expecting generally over how changed have groups pinning us some and regard you're there's for different pretty last that like the seeing to I quarter? you Most Can over there. kind the go down of of part view does are may year as what you your from customers and investment next next guess it what with thinking customer and DRAM give the first DRAM year China be on divergence sound DRAM is question because between you're about to

which in an isolated. that We the investment as that utilization And has And memory would terms growth some to relates expectations China all somewhat bandwidth expect hasn't see our changed financial high more of been earlier DRAM how and about good back rates of from I more how year. point incremental We'll the say in it improve, mentioned view in context have and view, around we would getting service DRAM of better, supporting much to business. decent much. year. to been is it's to in overall it quantitative that We've translates performance as This business seen improving. step-up January we investment has our investment high of an some year, for much been just say But from a a next KLA call. point customers' see next to their expect example. in

some just disagree so that Okay. much Great. be implications some generally are we customers leading implications more now, because perhaps I customers question simply more consolidate than because would investors edge others. if be It's could And when is that customers? probably tends more if to happens now. pressure are more than My next and to that just suppliers that what edge suppliers provide starting that. early Would about more the call thinking about. of there's it the it ask of your And But already. right with saw quickly just some growing leading has that than what -- would to consolidation? make

world designs, in advanced have need words, consolidation edge, had sure, are and -- the you'd places, because to at think more already many other that say, argue, efficiency depend on there scale. the you drivers. efficient. there was a would be would multiple driver leading single then I where a made a have What's is In they now been interesting it scale take so than it for the and microprocessor efficiency

I to not because So the the in way what forward. still of we -- segment measure think process get do about or we're there's for that that it capital people remains and at go you hoping that significantly leading we do that as a say, some the at intensity of And players up and edge, model control lot they're to I making and about the think there's modeling And part as we go that our capital is investments example. for the of for really efficiency don't it leading edge. Japan, market the is to have much. it assumption changes it -- think -- efficiency

player I haven't primarily there we've the edge. now, X for years at major mean, Truthfully, leading been. had really

the so volume. that's for And of most

So we're modeling we're there. already beyond the kind what that drive of go sense? to way. Does so up intensity might other than make were If that more that change,

Yes. Yes. That's thinking about. we're you. Thank something a

Thank ladies from you. time And question and more one have do that now Blayne Jefferies. We'll gentlemen, today. of we take Curtis for

the you to question market. this for your an in just and giving would X But be you're of perspective, give that I that feel one. of on curious kind kind I outlook the does was the last

appreciate greatly. I So that

report, digits them had assess the you know appreciate is kind guess to and I have don't you think, low growth. put generally, already out consensus a down have handful of think We I that. of brought everybody, companies single-digit market, people below I for double just was curious, kind something of a It just seems I as I trying there, I low. but

kind think that's that, are seems So your double trajectory. of numbers I'm like maybe I the digits. right just curious, tone suggest It your one, up would

think guess? kind I'm I wrong, people in have of I from. where So just curious outlook it that came general, And do

of about? what talking time sorry, are period I'm you

putting 'XX, I forecast right? you mean appreciate you the it For I out, you all out, put [indiscernible]. right? said But that high WFE

what X which XXs that to ago. 'XX 'XX what in update we No, high the actually mid-XXs, see is a haven't an we provided we put it we we months said out our the view versus

The actually of rate run as business. we of talked views So moving about thing XXXX, we stability in it a there. current a here to forward. our only reference to reasonable our put in number own relates is haven't amount out

was That China want other apologize. on the the just to I outlook. my on mistake. ask I one

talking of as were to I on you questions well. I couple your I want thought I you. sure revenue. clarity apologize But make end December think heard you down. markets for being said a about said had kind I XX% there you just in know of So you the prospective down, of China this.

heard the in I as it be year. So another dollar dropped you down way that you I rest amount, kind is growth. then would back can flat of then percent said revenue, which kind of seeing of still of thought And guess, the a but kind of it as you're into, for say a what I you

that's way of to was back want I you I that's if guess can understand there. And what you're you mechanics put trying trying growth. to just of I So understand said? you another to just kind it out the I what into double-digit know said.

Yes.

me -- in we is come said the We think leading in packaging work memory year maybe leading That's the that the on. We has growth bandwidth a this to advanced that's edge. high foundry. are advanced going is of our So to the we're It we it preparing where let doing going think earlier now. with from pertains as the year in edge. do lot to it do And with and that's has and to both next of logic Rick, the view. to we try clarify one growth things for think is at the

beyond and the about we've that we talking start we'll that the a the the a XXXX. what percent. edge legacy say. growth. driving back And China, don't is too When even look we or the largest business, to had, think it's We smaller to in The know. what's will as mature where happens, getting we then 'XX example, exactly, for don't such levels to 'XX business we're had but be It's historical that's we of look percent to exactly leading edge. business. That's for other model we when think early the not know and But leading

systems them edge. investment have install customers the more to going make they'd the In is originally first sure and for the want design of edge support be that's quarter, for been can we're that's time, good time they gives seeing on by what leading and the us that strength in But trend a that with long indications we're based and on based confidence leading-edge And our quite leading customers. the asking the acceleration, what 'XX in seeing. than to starts the planned for, in is conversations last we driven very them

Blayne, And that, you, up be for operator interest, your time. in for call instructions. with the any you, everybody, of I'll following your you thank following and turn Thank the back days. with for concluding many We'll over to the

at your Ladies this Kessel. Call September KLA conclude gentlemen, Earnings wonderful and Corporation Mr. will have and and you, Thank a Quarter line time, Webcast. that disconnect day. the XXXX Please