Why Kulicke and Soffa (KLIC) Shares Are Falling Today

Anthony Lee /
2024/02/01 1:35 pm EST

What Happened:

Shares of semiconductor production equipment company Kulicke & Soffa (NASDAQ: KLIC) fell 8.8% in the afternoon session after the company reported first-quarter results with revenue narrowly missing analysts' expectations. In addition, its free cash flow fell short of estimates, and its revenue and EPS guidance for the next quarter significantly missed analysts' projections. Furthermore, its operating margin shrunk. The company noted that continued weakness in its automotive and power end markets negatively impacted demand-commentary, which is consistent with its Q4 2023 remarks. Lastly, the management team is expecting its semiconductor unit growth to normalize later this year. Overall, this was a weaker quarter for Kulicke and Soffa.

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What is the market telling us:

Kulicke and Soffa's shares are quite volatile and over the last year have had 3 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

Kulicke and Soffa is down 11.3% since the beginning of the year, and at $46.80 per share it is trading 22% below its 52-week high of $59.98 from July 2023. Investors who bought $1,000 worth of Kulicke and Soffa's shares 5 years ago would now be looking at an investment worth $2,127.

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