KLA Corp. (NASDAQ:KLAC)

The analysis of the financial data reveals several notable trends and patterns across the observed periods.

Net Operating Profit After Taxes (NOPAT)

NOPAT exhibited a consistent upward trajectory from 1,310,622 thousand USD in mid-2020 to 3,852,307 thousand USD projected for mid-2025. Significant growth is observed between 2020 and 2022, with NOPAT more than doubling, indicating improved operating efficiency or margin expansion. The profit slightly fluctuated between 2023 and 2024 but showed a strong recovery in 2025 to its highest recorded level.

Cost of Capital

The cost of capital demonstrated a gradual increasing trend, rising from 16.05% in 2020 to an estimated 17.08% in 2025. This steady increase suggests a potentially higher risk environment or increased required returns by investors over time, which could impact investment decisions and valuation assessments.

Invested Capital

Invested capital expanded steadily from 6,592,642 thousand USD in 2020 to a projected 9,244,891 thousand USD in 2025. This reflects continuous reinvestment or asset growth, supporting the company's operational capabilities and possibly indicating strategic expansion or capital expenditures.

Economic Profit

Economic profit rose substantially from 252,779 thousand USD in 2020 to a peak of 2,124,953 thousand USD in 2022, highlighting strong value creation over cost of capital in these years. Although there was a slight decline in subsequent years through 2024, economic profit remained robust and rebounded to 2,273,360 thousand USD in 2025. The sustained positive economic profit underscores the company's ability to generate returns exceeding the cost of capital, signaling effective value-generating operations.

Overall, the data indicate a company experiencing steady growth in operating profits and invested capital, while managing to generate economic profits despite a rising cost of capital. The slight fluctuations in economic profit and NOPAT in the later years suggest some variability in operational efficiency or market conditions but do not detract from the overall positive performance trend.

The financial performance over the reviewed periods demonstrates notable fluctuations and growth patterns in key profitability metrics.

Net Income Attributable to KLA

The net income shows a strong upward trajectory from 1,216,785 thousand US dollars in mid-2020 to 3,381,277 thousand US dollars by mid-2023, indicating a substantial increase in profitability over the initial years. However, there is a decline in mid-2024 to 2,761,896 thousand US dollars, suggesting a temporary setback or increased expenses during this period. This is followed by a significant recovery and peak at 4,061,643 thousand US dollars in mid-2025, marking the highest profit level recorded in these periods.

Net Operating Profit After Taxes (NOPAT)

NOPAT trends closely follow the net income pattern, starting at 1,310,622 thousand US dollars in mid-2020 and rising steadily to 3,464,285 thousand US dollars by mid-2023. There is a minor decline to 3,284,868 thousand US dollars in mid-2024, aligning with the net income dip and possibly indicating operational challenges or market factors impacting earnings. By mid-2025, NOPAT recovers to 3,852,307 thousand US dollars, reflecting improved operational efficiency and profitability.

Overall, the data indicates robust growth in profitability over the five-year span with a minor interruption around mid-2024. The subsequent recovery in the latest period suggests resilience and effectiveness in addressing prior challenges.

The financial data reveals notable fluctuations in the taxation-related expenses over the analyzed periods.

Provision for Income Taxes

This item exhibits a generally increasing trend with some volatility. Starting from approximately 101.7 million USD in mid-2020, the provision saw a significant rise to 283.1 million USD by mid-2021. However, it then decreased to 167.2 million USD in mid-2022 before sharply increasing again to 401.8 million USD in mid-2023. The upward momentum continued, reaching 428.1 million USD in mid-2024 and further increasing to 582.8 million USD by mid-2025. Overall, there is a clear upward trajectory with a notable dip in the middle of the period.

Cash Operating Taxes

Cash operating taxes show a consistent and marked upward trend over the time horizon. Beginning at 224.5 million USD in mid-2020, the figure rose steadily to 360.2 million USD in mid-2021 and further climbed to 553.4 million USD by mid-2022. This increase continued substantially, reaching 805.2 million USD in mid-2023. A temporary decrease occurred in mid-2024 to 600.4 million USD, after which the amount surged again to a peak of 854.9 million USD by mid-2025. Despite the single-year decline in mid-2024, the overall pattern is one of significant growth in cash operating tax payments.

In summary, both provision for income taxes and cash operating taxes show increasing trends over the five-year period, indicative of either growth in taxable income, changes in tax rates, or adjustments in tax accounting. The volatility in the provision for income taxes suggests variability in anticipated tax expenses, while the cash operating taxes generally increase, reflecting the actual cash outflows related to tax payments with a minor temporary decline. These trends highlight growing fiscal obligations and possibly evolving tax strategies or financial conditions during the period analyzed.

The annual financial data reveals several notable trends in the company's capital structure from 2020 to the projected figures in 2025.

Total Reported Debt & Leases

The total reported debt and leases showed some volatility over the period analyzed. Initially, the debt level was approximately $3.57 billion in mid-2020, slightly decreasing to around $3.55 billion in mid-2021. Subsequently, there was a marked increase, with debt nearly doubling to about $6.77 billion by mid-2022. This peak was followed by a decline to approximately $6.06 billion in mid-2023. The debt rose again to an estimated $6.82 billion in mid-2024 before decreasing to roughly $6.09 billion by mid-2025. Overall, the company's debt levels experienced significant fluctuations, suggesting adjustments in financing strategy or capital needs during this period.

Total KLA Stockholders’ Equity

Stockholders’ equity grew from approximately $2.67 billion in mid-2020 to a peak near $3.38 billion in mid-2021. However, it then sharply declined to about $1.40 billion by mid-2022. This sudden drop contrasts with a recovery trend starting in mid-2023, when equity climbed back to nearly $2.92 billion, rising further to approximately $3.37 billion in mid-2024 and ultimately reaching an estimated $4.69 billion in mid-2025. This pattern indicates a strong rebound in equity after a significant contraction, possibly due to operational results, capital injections, or asset revaluations during this timeframe.

Invested Capital

Invested capital shows a consistent upward trend throughout the period examined. Starting at about $6.59 billion in mid-2020, it increased steadily each year to reach an estimated $9.24 billion by mid-2025. This gradual rise suggests ongoing investments in the business's productive assets, reflecting growth initiatives or expansion strategies employed by the company.

In summary, while invested capital demonstrated steady growth, the capital structure evidenced by debt and equity components experienced significant variability. The fluctuations in debt and equity, particularly the sharp decline and subsequent recovery in stockholders’ equity, signal dynamic financial management possibly responding to external conditions or strategic shifts. The overall increase in invested capital alongside these changes implies that the company is actively managing its financial resources to support its operations and growth outlook over the medium term.

Economic Profit

The economic profit demonstrates a notable upward trend over the observed periods. Initially, it increased sharply from 252,779 thousand US dollars in mid-2020 to 1,018,578 thousand in mid-2021. It continued to rise significantly to 2,124,953 thousand by mid-2022, followed by a slight decline in mid-2023 to 2,049,157 thousand. There was a further decrease in mid-2024 to 1,790,905 thousand, but the economic profit recovered in mid-2025, reaching 2,273,360 thousand. Overall, the figure shows strong growth with some fluctuations in the latter years.

Invested Capital

Invested capital shows a consistent increase throughout the entire period. Starting at 6,592,642 thousand US dollars in mid-2020, it rose steadily year-on-year to 9,244,891 thousand by mid-2025. This steady growth in invested capital suggests ongoing business expansion or increased asset base investment.

Economic Spread Ratio

The economic spread ratio exhibits significant variability but generally maintains a strong positive level. Starting at 3.83% in mid-2020, it surged sharply to 14.93% in mid-2021 and peaked at 26.31% in mid-2022. It then declined moderately to 24.03% in mid-2023 and further to 20.16% by mid-2024. In mid-2025, the ratio rebounded to 24.59%. Despite some declines after 2022, the spread remains significantly higher than the initial value, indicating enhanced profitability relative to invested capital over time.

Overall Analysis

The financial data reveal a period of substantial growth in economic profit and invested capital, reflecting robust business expansion. While economic profit has some volatility in later years, it remains at a high level. The economic spread ratio’s fluctuations suggest changing efficiency or returns on invested capital, but overall it indicates strong value creation. The combination of rising invested capital and sustained high economic spread ratios points to effective capital utilization leading to improved economic profit generation.

Economic Profit

The economic profit experienced a notable upward trend from mid-2020 through mid-2022, rising significantly from approximately 253 million to over 2.12 billion US dollars. This was followed by a slight decline in 2023 and 2024, with values decreasing to about 1.79 billion US dollars, before rebounding in 2025 to 2.27 billion US dollars. Overall, despite short-term fluctuations, economic profit demonstrated strong growth across the analyzed period.

Adjusted Revenues

Adjusted revenues showed a consistent increase over the years, starting from roughly 5.88 billion US dollars in 2020 and reaching approximately 12.09 billion US dollars in 2025. The most substantial growth occurred between 2021 and 2023, with revenues increasing by over 3 billion US dollars. A slight dip was observed in 2024, followed by a recovery in 2025. This trend indicates steady expansion in sales or service-related income before a minor temporary setback.

Economic Profit Margin

The economic profit margin demonstrated significant improvement from 4.3% in 2020 to over 22% in 2022, reflecting enhanced profitability relative to revenues. However, it declined to approximately 17.3% in 2024 before slightly improving again in 2025 to nearly 19%. These fluctuations suggest some volatility in cost management or pricing strategies impacting the proportion of economic profit generated from total revenues.

Summary of Trends

In summary, the financial data highlights a general pattern of growth in both economic profit and adjusted revenues, with economic profit margins showing cyclical variation. The rise in economic profit outpaced revenue growth until 2022, indicating improved operational efficiency or higher value creation. The subsequent dip in profit margin and economic profit suggests challenges in maintaining peak profitability, although the rebound in 2025 indicates a positive outlook for future financial performance.