Analyst(s): Futurum Research
Publication Date: February 3, 2026
KLA’s quarter reflected resilient demand for process control tied to AI infrastructure across foundry/logic, memory, and advanced packaging. Management highlighted rising lead times, a strong backlog, and near-term gross margin headwinds from higher DRAM component costs.
What is Covered in this Article:
- KLA’s Q2 FY 2026 financial results
- AI-driven inspection and metrology intensity
- Advanced packaging growth and constraints
- Services scale and installed base leverage
- Guidance and Final Thoughts
The News: KLA Corporation (NASDAQ: KLAC) reported results for Q2 FY 2026. Revenue was $3.3B, up 7.2% year over year (YoY), versus Wall Street consensus of $3.25B. Semiconductor Process Control revenue was $3.0B (+9.0% YoY), Specialty Semiconductor Process was $140.6 million (-12.4% YoY), and PCB and Component Inspection was $152.2 million (-5.5% YoY). Non-GAAP operating margin was 42.8%, and non-GAAP gross margin was 62.6%. Non-GAAP net income was $1.2B (+6.4% YoY), and non-GAAP diluted EPS was $8.85 (+7.9% YoY).
“As the market leader in process control, KLA is well positioned to take advantage of this long-term trend,” said Rick Wallace, president and CEO of KLA Corporation. “As we look forward to calendar year 2026, KLA is a key enabler of the AI ecosystem and continues to uniquely benefit from the AI infrastructure buildout across all major growth vectors, including foundry/logic, memory, advanced packaging, and services.”
KLA Corporation Q2 FY 2026 Results Beat on AI-Led Demand
Analyst Take: KLA’s results show continued AI-led expansion of process control intensity across advanced logic and memory, with inspection and reticle tools positioned to benefit from rising design complexity and larger die sizes. Management cited extending lead times and a strengthening backlog into late FY 2026, reflecting broad-based customer engagement. Advanced packaging remains a key growth vector, though facility readiness is pacing shipments near term. Services delivered strong growth on a larger and more complex installed base, supporting recurring revenue and execution consistency. Near-term gross margin headwinds from higher DRAM component costs are expected to moderate as supply increases into year-end 2026.
AI Infrastructure Elevates Inspection Intensity
AI infrastructure investments continue to expand inspection and metrology demand as customers chase yield and reliability at advanced nodes. Management highlighted robust traction in Broadband Plasma (BBP) inspection tools and capacity additions aligned to AI-driven ramps. Memory intensity is rising, particularly in high-bandwidth memory (HBM), where customers are deploying advanced inspection to meet tighter thresholds. Back-penetration into prior nodes is occurring as customers optimize existing fabs amid shell constraints. Lead times are extending and the sales funnel is strengthening, pointing to sustained demand through FY 2026 and into FY 2027. These dynamics support continued outperformance versus core wafer fab equipment (WFE) in the period ahead.
Advanced Packaging Traction and Facility Readiness
KLA cited approximately $950 million of advanced packaging systems revenue in calendar 2025, representing over 70% YoY growth, with mid- to high-teens growth expected in 2026. Customers are constrained by facility readiness and fab shell availability, which is pacing first-half shipments. The mix of systems tied to chiplet architectures and heterogeneous integration is increasing the value of process control in packaging. KLA expects momentum to continue as customers scale 2.5D/3D architectures to meet AI system performance targets. Management expects more pronounced acceleration as facility bottlenecks ease into 2027. Near-term constraints temper shipment timing but do not alter the multi-year trajectory.
Services Scale and Installed Base Leverage
Services revenue reached $786 million in the quarter, up 6% sequentially and 18% YoY, underscoring installed base leverage. The company marked a 16th consecutive year of annual services growth, with a compounded annual growth rate above 12%. Increasing tool complexity and higher process control intensity are expanding parts, maintenance, and software analytics opportunities. Services performance also contributed to better-than-modeled gross margin in the quarter. A growing, complex installed base supports recurring revenue visibility and operational stability. This engine remains a pillar for consistency through cycles.
Guidance and Final Thoughts
Management’s 2026 market view points to core WFE in the low $120B range and advanced packaging at approximately $12B, for a total mid-$130B market. The company has guided for Q3 FY 2026 revenue of $3.2B to $3.5B as compared to the consensus estimate of $3.3B. Non-GAAP EPS is projected at $8.3 to $9.9. KLA expects H1 FY 2026 revenue to grow mid-single digits over H2 FY 2025, with acceleration in H2 FY 2026 as supply and facilities improve. Mix is expected to remain balanced with foundry/logic at approximately 60% and memory at approximately 40% of semiconductor process control systems, with DRAM at roughly 85% of memory. Non-GAAP gross margin is modeled at approximately 62% ± 50 basis points for 2026, reflecting a 75 to 100 basis point headwind from higher DRAM component costs that should moderate by year-end. China is expected to be flat to modestly positive, with company revenue contribution in the mid- to high-20% range. KLA’s lead times and backlog signal durable demand and multi-year share gains across AI-driven inspection, HBM, and advanced packaging.
See the full press release on KLA Corporation’s Q2 FY 2026 financial results on the company website.
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Disclosure: Futurum is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum as a whole.
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