Earnings Preview: KLA-Tencor

| About: KLA-Tencor Corporation (KLAC)

KLA-Tencor (NASDAQ:KLAC) is expected to report Q4 earnings after the market close on Thursday, July 26, with a conference call scheduled for 5:00 pm ET.


The consensus estimate is $1.31 for EPS and $874.41M for revenue, according to First Call. Despite an expected dip in profit, analysts are generally optimistic about KLA-Tencor. The company is hoping to build on a revenue increase last quarter. For Q4, management expects orders to be down 7% to up 14%, revenue of between $840M-$900M, opex to be slightly up sequentially, other income/expense to be a net expense of $10M, a tax rate of 26% and a share count of 171M, resulting in a non-GAAP EPS of $1.20-$1.38. Recently, KLAC held its Analyst Day, where it announced the increase of its quarterly dividend to 40c from 35c. Stifel expects the company to exceed its pro-forma EPS/revenue estimates of $1.39/$882.5M, excluding options -- $1.30 including.

Analyst Views

Stifel believes that bookings were essentially flat from March driven by another strong quarter by the foundries. Although management cited that it expects September bookings to be down, it also anticipated a rebound in December -- which is in-line with Stifel's thesis. The firm believes that KLA-Tencor will benefit from a return of some foundry push-outs, as well as a return from Intel (NASDAQ:INTC) spending in the December quarter. :