UPDATE 3-KLA-Tencor profit beats Street, shares tick up

Thu Oct 29, 2009 7:40pm EDT

* Q1 EPS ex-items 15 cents vs Street view 2 cents

* Q1 revenue $343 mln vs Street view $332.5 mln

* Shares rise 0.7 pct after-hours (Updates shares, adds executive comment, outlook)

By Ian Sherr

SAN FRANCISCO, Oct 29 (Reuters) - Chip-equipment maker KLA-Tencor Corp (KLAC.O) gave stronger-than-expected forecasts for current quarter revenue and earnings, underscoring a semiconductor industry rebound.

KLA-Tencor, which managed a slim fiscal first-quarter profit after losing money the three previous quarters, had been expected to turn in a strong performance after good numbers from rivals such as Novellus Systems NVLS.O, which raised its fourth-quarter outlook as demand for consumer electronics begins to recover. [ID:nN21508048]

On Thursday, KLA forecast second-quarter adjusted earnings of 24 to 30 cents a share on revenue of $420 million to $450 million. Analysts had been forecasting, on average, 12 cents of earnings on revenue of $376.2 million.

"At this point, it feels like the worst is behind us," said KLA-Tencor Chief Executive Richard Wallace, adding that the company is seeing a broader range of customers moving ahead with capital investment plans.

The company also said it will consider stock buybacks.

KLA-Tencor, which competes with Applied Materials Inc (AMAT.O) to provide systems that monitor and analyze chip products, on Thursday reported net income of $20 million, or 12 cents a share, compared with $19 million, or 11 cents a share, a year earlier.

Excluding items, it earned 15 cents a share, sharply ahead of the average analysts' estimate of 2 cents a share, according to Thomson Reuters I/B/E/S.

Revenue for the first quarter fell to $343 million but exceeded the average Wall Street estimate of $332.5 million.

KLA-Tencor's results are the latest positive sign from the semiconductor industry as demand for consumer electronics begins to recover, particularly spending on personal computers.

Shares of KLA-Tencor closed 3.1 percent higher at $34.28 in regular trading on the Nasdaq and rose another 0.7 percent to $34.51 in after-hours trading. (Editing by Leslie Gevirtz and Steve Orlofsky)

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

Find your dream retirement town

Florida? Hawaii? Reuters has teamed up with Zillow to give you the power to customize a list of your best places to retire.  Video | Full Article