KLA’s services business continued expanding during fiscal Q3 2026, with services revenue increasing approximately 16% year-over-year to $774.8 million as growth in the company’s installed base creates an increasingly substantial recurring revenue stream.
Services represented approximately 23% of KLA’s $3.415 billion of quarterly revenue, compared with 22% a year earlier. Services revenue increased from approximately $669.2 million to $774.8 million.
KLA said its services business has consistently expanded year-over-year and is generated largely through recurring, subscription-like contracts. The business benefits from the growing installed base of KLA systems, continued support requirements and efforts by customers to extend the useful lives of semiconductor manufacturing equipment.
Total fiscal Q3 revenue increased to $3.415 billion from $3.063 billion a year earlier and exceeded the midpoint of KLA’s guidance. GAAP net income reached $1.20 billion, while diluted EPS increased to $9.12 from $8.16.
The company generated $707.5 million of operating cash flow and $622.3 million of free cash flow during the quarter. Capital returned to shareholders totaled approximately $874.8 million.
KLA also authorized another $7 billion of share repurchases and increased its quarterly dividend to $2.30 per share, extending its annual dividend-growth streak to 17 consecutive years.
Beyond services, management sees artificial intelligence infrastructure spending supporting opportunities across foundry and logic, memory, advanced packaging and process control. The increasing complexity of leading-edge semiconductor manufacturing is expanding the need for KLA’s inspection and metrology technologies.
KEY QUOTES:
“Our business momentum remains robust, and we are highly confident in our outlook for calendar year 2026.”
Rick Wallace, President And CEO Of KLA
