KLA Corp shares traded essentially unchanged on Monday, hovering around $1,440 by midday, while other major semiconductor equipment stocks posted modest gains. The stock moved within a range between approximately $1,415 and $1,458 during the session.
Chip Sector Rebounds as Economic Data Awaited
The semiconductor sector showed signs of recovery following a recent sell-off in technology shares. However, KLA underperformed peers such as Applied Materials, which rose about 1.7%, and ASML, up roughly 1.5%. Market participants are closely monitoring upcoming U.S. economic indicators, including nonfarm payrolls and Consumer Price Index data, which could influence the Federal Reserve's interest rate policy trajectory.
Strong Year-to-Date Performance and Dividend Declaration
Despite the recent pause, KLA shares have advanced nearly 18% since the start of the year, significantly outpacing the S&P 500's gain of about 2%. The company's board has approved a quarterly cash dividend of $1.90 per share. The dividend will be paid on March 3 to shareholders of record as of February 17.
Earnings Beat Met with Caution; China Presents Headwinds
KLA reported quarterly results on January 29 that exceeded analyst expectations and provided guidance for the current quarter ahead of consensus. Nevertheless, shares declined roughly 7% in after-hours trading following the report. Analysts characterized the outlook as indicating steady growth rather than a renewed acceleration.
The company, along with its peers in the chip equipment industry, faces significant challenges in China. Beijing's push for domestic self-sufficiency in semiconductor manufacturing tools is intensifying, pressuring foreign suppliers. This comes as U.S. export restrictions further complicate the landscape for selling advanced equipment into the Chinese market.
Traders continue to watch for any revisions to industry spending forecasts, particularly for wafer fabrication equipment (WFE), as even minor adjustments can significantly impact order books for toolmakers like KLA.
