KLA delivered a strong QQ1 2026 quarter, underscored by revenue of $3.21 billion and non-GAAP diluted EPS of $8.81 (GAAP EPS $8.47), with a robust gross margin of 62.5% and non-GAAP operating margin of 43.2%. The company generated $1.161 billion of cash flow from operations and $1.07 billion in free cash flow, supporting a disciplined capital return program that included $545 million in share repurchases and $254 million in dividends in the quarter, and a 16th consecutive dividend increase announced earlier in 2025. Management highlighted AI infrastructure investments, rapid adoption of advanced packaging, and expanding process control intensity as key growth drivers, while noting China-related export controls as a near-term headwind with an estimated $300 million to $350 million revenue impact through calendar 2026. The December quarter guidance calls for revenue of $3.225 billion ± $150 million with a 62% gross margin, and GAAP/Non-GAAP EPS of $8.46 ± $0.78 and $8.70 ± $0.78, respectively. The long-run thesis centers on KLA’s differentiated process control portfolio, the expanding served markets in advanced packaging, and a multi-year growth trajectory that should allow it to outperform mid-to-high single-digit WFE growth while generating durable cash flow and shareholder value. Near-term risks include China-related market access restrictions and macro Cyclicality in WFE spend, but management remains confident in near-term demand and the runway for packaging and AI-driven design complexity.