KLA Corp. (NASDAQ:KLAC)

Net Operating Profit After Taxes (NOPAT)

The NOPAT demonstrates a general upward trend over the six-year period. Beginning at $1,310,622 thousand in 2020, the figure increases significantly to $3,852,307 thousand by 2025. The most substantial growth occurs between 2020 and 2022, with a slightly slower increase afterward. There is a minor decline observed in 2024 compared to 2023, but the profitability recovers strongly in 2025.

Invested Capital

Invested capital shows steady growth throughout the period. Starting at $6,592,642 thousand in 2020, it rises consistently each year, reaching $9,244,891 thousand by 2025. The growth in invested capital is more gradual relative to the increase in NOPAT, indicating a controlled expansion of the capital base.

Return on Invested Capital (ROIC)

The ROIC displays significant variations with an overall positive trend. It begins at 19.88% in 2020, experiences a sharp increase to 42.51% by 2022, and then fluctuates slightly but remains strong above 35% throughout the later years. There is a slight decline in 2024 to 36.99%, but the return recovers to 41.67% in 2025, suggesting effective utilization of invested capital for generating operating profits over time.

Overall Financial Performance Trends

Across the six years, the company has managed to substantially increase its NOPAT and invested capital, with profitability improvements outpacing capital growth, as reflected in the high ROIC percentages. The data suggests strong operational efficiency and effective capital management. Despite minor fluctuations in specific years, particularly 2024, the overall financial health shows robust performance and increasing value creation for investors.

Over the period analyzed, there are several notable trends in the financial performance ratios.

Operating Profit Margin (OPM)

The operating profit margin shows an overall increasing trend from 26.09% in 2020 to a peak of 41.73% in 2022. After 2022, the margin slightly decreased but remained relatively high, fluctuating between 37.54% and 39.78% through 2025. This suggests strong operational efficiency and profitability over the years, with a slight moderation in the more recent periods.

Turnover of Capital (TO)

The turnover of capital improved steadily from 0.89 ratio in 2020 to 1.31 in 2025, with consistent incremental increases each year except a small dip in 2024 to 1.17. This indicates enhanced asset utilization efficiency, enabling the company to generate more revenue per unit of capital employed.

1 – Effective Cash Tax Rate (CTR)

This metric remained relatively stable, fluctuating around the mid-80% range. Starting at 85.38% in 2020, it peaked slightly at 86.12% in 2022, followed by decreases and increases without a distinct trend, ending near 81.84% in 2025. The fluctuations suggest some variability in tax efficiency or tax-related adjustments over the years, but no significant improvement or deterioration.

Return on Invested Capital (ROIC)

Return on invested capital improved substantially from 19.88% in 2020, rising sharply to 42.51% in 2022. Subsequently, it exhibited minor fluctuations but remained high, maintaining above 36% from 2023 onwards and ending at 41.67% in 2025. This demonstrates increased effectiveness in generating returns from invested funds, highlighting strong value creation over time.

In summary, the company displayed marked improvements in profitability and capital efficiency from 2020 through 2022, with high but slightly variable levels maintained thereafter. The operating profit margin and ROIC both reached significantly higher levels, indicating enhanced operational performance and investment returns. Turnover of capital showed steady gains, reflecting better utilization of assets. Tax efficiency remained relatively stable without notable improvement. Overall, the trends suggest robust financial health with strong operational control and capital management throughout the period.

The financial data reveals significant growth in key performance metrics over the observed periods, with some fluctuations in profitability indicators that warrant attention.

Net Operating Profit Before Taxes (NOPBT)

The NOPBT demonstrates a strong upward trend from 1,535,117 thousand USD in mid-2020 to an estimated 4,707,242 thousand USD by mid-2025. This represents a more than threefold increase over five years, indicating enhanced operational efficiency and profitability capacity. There was a notable surge between 2021 and 2022, and despite a slight decline in 2024, the figure rebounds significantly in 2025, suggesting recovery and growth momentum.

Adjusted Revenues

Adjusted revenues steadily increase from 5,884,690 thousand USD in 2020 to an anticipated 12,087,609 thousand USD in 2025. The largest increment occurs between 2021 and 2023, with revenues peaking at over 10.7 billion USD. Although there is a minor decrease in 2024, the upward trajectory continues, reflecting expanded sales or service volume over time.

Operating Profit Margin (OPM)

The operating profit margin shows an improving trend from 26.09% in 2020 to a peak of 41.73% in 2022, signifying increased effectiveness in managing operating expenses relative to revenues. Post-2022, the margin mildly declines to 37.54% in 2024 before recovering slightly to 38.94% in 2025. This fluctuation could indicate varying cost pressures or pricing strategies but overall suggests sustained strong profitability levels.

In summary, the data implies robust growth in both revenue and operating profits over the examined time frame, accompanied by favorable operating margins. Temporary declines in certain years point to potential market or operational challenges but are outweighed by the overall positive trajectory. This pattern reflects a successful expansion strategy and effective cost management, positioning the entity for continued financial strength.

Adjusted Revenues

The adjusted revenues demonstrate a generally upward trend over the analyzed periods. Starting at approximately $5.88 billion in mid-2020, revenues increased significantly to about $9.55 billion by mid-2022, representing strong growth during this timeframe. After reaching a peak of approximately $10.73 billion in mid-2023, revenues experienced a slight dip to around $10.35 billion in mid-2024. The most recent period shows a recovery and further growth, with revenues rising to approximately $12.09 billion by mid-2025. Overall, the data indicate robust revenue expansion with a minor fluctuation between 2023 and 2024.

Invested Capital

Invested capital has followed a steady upward path over the years. Beginning at $6.59 billion in mid-2020, it increased incrementally each year to reach approximately $9.24 billion by mid-2025. The growth rate in invested capital appears consistent, reflecting ongoing capital investment activities. This stable rise suggests a commitment to expanding or maintaining asset bases to support company operations and revenue growth.

Turnover of Capital (TO)

The turnover of capital ratio exhibits a positive evolution, indicating enhanced efficiency in using capital to generate revenue. The ratio improved from 0.89 in 2020 to 1.26 by mid-2023, signifying a more effective deployment of invested capital. Although there was a minor decline to 1.17 in mid-2024, the ratio rebounded strongly to 1.31 in mid-2025, reaching its highest level in the observed period. This pattern suggests ongoing improvements in operational performance and capital utilization over the long term.

Overall Insights

The data reveal a company experiencing solid growth in revenues and invested capital, coupled with improving capital efficiency. Despite a slight revenue dip in mid-2024, the general trajectory is upward, supported by a steady increase in invested capital and a favorable trend in capital turnover. This indicates effective management of resources and a strengthening operational capability to translate assets into sales, which bodes well for future financial performance.

Cash Operating Taxes

The cash operating taxes show a general upward trend over the period, increasing from $224,495 thousand in mid-2020 to $854,935 thousand in mid-2025. The growth is not strictly linear; there is a notable jump between 2021 and 2023, reaching a peak of $805,213 thousand in mid-2023 before a slight decrease in mid-2024 followed by another increase in mid-2025.

Net Operating Profit Before Taxes (NOPBT)

The net operating profit before taxes displays a strong growth trajectory from $1,535,117 thousand in mid-2020 to $4,707,242 thousand in mid-2025. The most substantial increases occur between mid-2020 and mid-2023, with a marginal decline in mid-2024, before rising again in mid-2025. This suggests underlying operational strength with some fluctuations in profitability.

Effective Cash Tax Rate (CTR)

The effective cash tax rate exhibits moderate variability over the years. It starts at 14.62% in mid-2020, declines slightly to about 13.88% in mid-2022, then rises sharply to 18.86% in mid-2023. Following that peak, the tax rate decreases to 15.45% in mid-2024 and increases again to 18.16% in mid-2025. This fluctuation may indicate changes in tax regulations, corporate tax strategies, or variations in taxable income composition over time.