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1. Company Snapshot

1.a. Company Description

Kulicke and Soffa Industries, Inc.designs, manufactures, and sells capital equipment and tools used to assemble semiconductor devices.It operates through two segments, Capital Equipment, and Aftermarket Products and Services (APS).


The company manufactures and sells advanced displays; die-transfer, flip-chip, and TCB advanced packaging products; ball bonder, die-attach, electronics assembly, lithography, wafer-level bonder, and wedge bonder products; consumables, such as capillaries, dicing blades, and wedge bonds; and auto offline programming, KNet PLUS, and new product introduction/manufacturing execution system software products.It also services, maintains, repairs, and upgrades equipment.The company serves semiconductor device manufacturers, integrated device manufacturers, outsourced semiconductor assembly and test providers, other electronics manufacturers, industrial manufacturers, and automotive electronics suppliers primarily in the United States and the Asia/Pacific region.


Kulicke and Soffa Industries, Inc.was founded in 1951 and is headquartered in Singapore.

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1.b. Last Insights on KLIC

Kulicke and Soffa Industries' recent performance was negatively impacted by the company's guidance calling for a streak of quarterly revenue declines to continue, despite beating Q1 earnings and revenue estimates. The latest report suggests that the downturn in the industry may not be over, with China's influence being a significant concern. Additionally, the company's guidance negated the better-than-expected quarterly results, indicating that the positive momentum may be short-lived.

1.c. Company Highlights

2. K&S Posts Strong Q4 Revenue with Improving End Market Dynamics

Kulicke and Soffa's (K&S) fiscal fourth quarter 2025 revenue was $177.6 million, with GAAP earnings per share of $0.12 and non-GAAP earnings per share of $0.28, beating analyst estimates of $0.222. The company's revenue breakdown showed a significant increase in general semiconductor revenue, up 24% sequentially, while memory-related revenue jumped nearly 60% sequentially to $24.4 million. Utilization rates for high-volume general semiconductor and memory applications were over 80%, indicating a strong operational performance.

Publication Date: Nov -21

📋 Highlights
  • Q4 2025 Revenue & Earnings:: Revenue reached $177.6 million, with non-GAAP EPS at $0.28 amid strong market transitions.
  • Sequential Revenue Growth:: General semiconductor revenue rose 24% sequentially; memory revenue surged nearly 60% to $24.4 million.
  • Share Repurchases:: Fiscal 2025 repurchases totaled $96.5 million, covering 2.4 million shares (5% of outstanding shares).
  • 2026 Growth Drivers:: Expected 7% sequential Q1 2026 revenue ($190 million) with 47% gross margin and $71 million non-GAAP operating expenses.
  • Vertical Wire Business:: Projected to generate $10 million in 2026, with significant growth anticipated in 2027 due to power semiconductor transitions.

Revenue Growth Drivers

The company's advanced packaging, advanced dispense, and power semiconductor transitions are progressing well, with improving end market dynamics. The general semiconductor market is rebounding, driven by smartphone and high-performance computer demand. Additionally, the automotive and industrial markets are showing early signs of improvement, with revenue expected to increase sequentially in Q1. K&S expects FY '26 to be a better year for auto industrial, driven by technology transition on power semi for cleantech and EV.

Financial Outlook and Guidance

K&S expects revenue to increase by approximately 7% sequentially to $190 million in the December quarter, with gross margins at 47%. Non-GAAP operating expenses are expected to be $71 million. The company is optimistic about fiscal 2026, with anticipated growth driven by technology transitions, share gains, and cyclical recovery. Half of the incremental growth is expected to come from technology transitions, such as thermocompression and vertical wire applications.

Valuation and Growth Prospects

With a P/E Ratio of 95.45 and an EV/EBITDA of 64.74, K&S's valuation suggests high expectations for future growth. Analysts estimate next year's revenue growth at 14.3%. The company's entry into the HBM market with a thermocompression bonding tool is expected to perform well as standards change and density increases. The vertical wire business is expected to ramp in 2026, with revenue of around $10 million, growing significantly in 2027 and beyond.

Share Repurchase and Leadership Transition

During the September quarter, K&S repurchased 464,000 shares for $16.7 million, and over fiscal year 2025, they repurchased 2.4 million shares, representing nearly 5% of shares outstanding for $96.5 million. The company is confident in its capabilities and technology leadership, prepared to navigate the near-term macro environment. Fusen, former K&S CEO, is retiring, and Lester Wong, the new CEO, expressed gratitude to Fusen for his vision and strategy that drove the company's growth through technology transition.

3. NewsRoom

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Ceredex Value Advisors LLC Sells 57,063 Shares of Kulicke and Soffa Industries, Inc. $KLIC

Nov -29

Source: defenseworld.net

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Kulicke and Soffa Industries, Inc. (NASDAQ:KLIC) Receives Consensus Recommendation of “Moderate Buy” from Analysts

Nov -29

Source: defenseworld.net

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Touchstone Small Company Fund Q3 2025 Performance Review

Nov -27

Source: seekingalpha.com

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Will Kulicke and Soffa (KLIC) Gain on Rising Earnings Estimates?

Nov -26

Source: zacks.com

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Kulicke and Soffa Industries, Inc. $KLIC Shares Purchased by Creative Planning

Nov -26

Source: defenseworld.net

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Creative Planning Grows Stock Holdings in Kulicke and Soffa Industries, Inc. $KLIC

Nov -26

Source: defenseworld.net

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Kulicke and Soffa (KLIC) Upgraded to Strong Buy: Here's What You Should Know

Nov -25

Source: zacks.com

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Why Kulicke & Soffa Industries Stock Triumphed on Thursday

Nov -21

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.17%)

6. Segments

Ball Bonding Equipment

Expected Growth: 10%

The 10% growth of Ball Bonding Equipment from Kulicke and Soffa Industries, Inc. is driven by increasing demand for advanced packaging technologies, rising adoption of 5G and IoT devices, and growing need for miniaturization and high-performance interconnects in the semiconductor industry.

Wedge Bonding Equipment

Expected Growth: 9%

The 9% growth of Wedge Bonding Equipment from Kulicke and Soffa Industries, Inc. is driven by increasing demand for advanced packaging technologies, rising adoption of 5G and IoT devices, and growing need for miniaturization and heterogeneous integration in the semiconductor industry.

Aftermarket Products and Services

Expected Growth: 12%

The 12% growth in aftermarket products and services from Kulicke and Soffa Industries, Inc. is driven by increasing demand for semiconductor assembly and testing, growing adoption of electric vehicles, and rising need for advanced packaging technologies. Additionally, the company's expanding customer base, strategic partnerships, and continuous innovation in wire bonding and die attach equipment also contribute to this growth.

Advanced Solutions

Expected Growth: 11%

Kulicke and Soffa Industries' Advanced Solutions segment growth is driven by increasing demand for miniaturization and electrification in the automotive and industrial markets, as well as the adoption of 5G and IoT technologies. The company's innovative wire bonding and advanced packaging solutions are key enablers of these trends, resulting in an 11% growth rate.

All Others

Expected Growth: 8%

Kulicke and Soffa Industries' 8% growth in All Others segment is driven by increasing demand for semiconductor assembly and packaging, growth in automotive and industrial markets, and expansion of its product portfolio through strategic acquisitions and partnerships.

7. Detailed Products

LED Chips

Kulicke and Soffa Industries, Inc. offers a range of LED chips used in various applications such as automotive, consumer electronics, and industrial lighting.

Wire Bonders

The company provides wire bonders used in the assembly and packaging of semiconductor devices.

Die Attach

Kulicke and Soffa Industries, Inc. offers die attach products used in the assembly and packaging of semiconductor devices.

Wedgewedge Bonders

The company provides wedgewedge bonders used in the assembly and packaging of semiconductor devices.

Ribbon Bonders

Kulicke and Soffa Industries, Inc. offers ribbon bonders used in the assembly and packaging of semiconductor devices.

Copper Wire Bonders

The company provides copper wire bonders used in the assembly and packaging of semiconductor devices.

8. Kulicke and Soffa Industries, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Kulicke and Soffa Industries, Inc. is moderate due to the availability of alternative semiconductor equipment and materials.

Bargaining Power Of Customers

The bargaining power of customers for Kulicke and Soffa Industries, Inc. is low due to the company's strong relationships with its customers and the lack of concentration in the industry.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Kulicke and Soffa Industries, Inc. is moderate due to the presence of multiple suppliers and the company's ability to negotiate prices.

Threat Of New Entrants

The threat of new entrants for Kulicke and Soffa Industries, Inc. is low due to the high barriers to entry in the semiconductor equipment industry, including the need for significant capital investment and technological expertise.

Intensity Of Rivalry

The intensity of rivalry for Kulicke and Soffa Industries, Inc. is high due to the competitive nature of the semiconductor equipment industry, with multiple players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 3.96%
Debt Cost 3.95%
Equity Weight 96.04%
Equity Cost 11.37%
WACC 11.07%
Leverage 4.12%

11. Quality Control: Kulicke and Soffa Industries, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Kulicke and Soffa

A-Score: 4.7/10

Value: 1.6

Growth: 3.3

Quality: 6.6

Yield: 1.7

Momentum: 5.5

Volatility: 9.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

49.21$

Current Price

49.21$

Potential

-0.00%

Expected Cash-Flows