KLA (KLAC) Q1 2027 earnings summary

Executive summary

• Q1 FY27 revenue was $4.136B, up 29% YoY and 13% QoQ; GAAP diluted EPS was $1.18 and non-GAAP diluted EPS was $1.22, exceeding guidance midpoints.

• AI infrastructure investment, leading-edge process-control intensity, memory complexity and advanced packaging drove growth; backlog and sales visibility supported confidence in significant 2027 growth.

Financial highlights

• GAAP net income was $1.549B and non-GAAP net income was $1.603B; GAAP gross margin was 61.9% and non-GAAP gross margin was 62.7%.

• GAAP operating margin was 45.0%; non-GAAP operating margin reached a record 46.1%.

• Operating cash flow was $1.531B and free cash flow was $1.336B; capital expenditures were $194.8M.

Outlook and guidance

• Q2 FY27 revenue guidance is $4.7B ± $200M; GAAP diluted EPS is $1.41 ± $0.11 and non-GAAP diluted EPS is $1.44 ± $0.11.

• Q2 non-GAAP gross margin guidance is 62.5% ± 1 percentage point; operating expenses are expected at ~$710M, with a 14.5% planning tax rate.

• H2 2026 revenue is expected to rise ~25% over H1; sequential growth is expected for the next several quarters, with a more linear 2027 pattern than the H2 step-up.

• Wafer equipment market outlook is in the mid-$150B range in 2026 and above $200B in 2027.