KLA Corp

KLAC: XNAS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$667.00	Jlyzy	Tdryxjplxw

KLA's Process Diagnostic and Control Leadership Merits a Wide Economic Moat

William Kerwin

May 25, 2023

Business Strategy and Outlook

KLA dominates the process diagnostic and control, or PDC, segment of the semiconductor equipment industry. During the fabrication process, wafers must be inspected for defects and proper critical dimensions to identify and rectify problem sources. As chipmaking customers continue pursuing Moore's law, smaller chips must meet more precise specifications, which in turn increase the need for advanced PDC tools from the likes of KLA. These tools help customers improve yields, accelerate development and product ramps, and ultimately maximize profitability. We think KLA boasts a wide economic moat and is well positioned for healthy growth going forward.

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