New York, January 15, 2026, 18:10 EST — After-hours
- KLA shares jumped roughly 8% in late trading, riding a wave across the chip-equipment sector
- TSMC’s boost to its 2026 spending forecast sent shockwaves across the sector
- Ahead of KLA’s earnings report on Jan. 29, analysts are raising their price targets
KLA Corp shares climbed 7.7% to $1,544.96 in after-hours trading Thursday, following a session that saw the stock fluctuate between $1,487.53 and $1,571.19.
The boost came after Taiwan Semiconductor Manufacturing Co exceeded expectations and raised its 2026 capital expenditure forecast to $52 billion-$56 billion. That increase sparked fresh optimism about chipmaking investments, with some analysts suggesting it could ease concerns over a slowdown in AI-driven demand. “The market has underestimated again how large is the demand for AI, and the implementation is going faster than everybody expected,” said Han Dieperink, chief investment officer at Aureus. (Reuters)
KLA sees a clear takeaway: as chip features shrink, spending rises, driving demand for more inspection and measurement tools. These instruments are essential for “process control,” helping chipmakers spot defects and maintain yields even as manufacturing grows more complex.
Wells Fargo bumped KLA up to Overweight from Equal Weight, lifting its price target to $1,600 from $1,250. The firm highlighted ongoing strength in advanced nodes like 2-nanometer manufacturing and a pickup in high-performance computing demand. (Investing)
Stifel bumped up its price target on KLA to $1,600 from $1,260, maintaining a Buy rating. The firm pointed out that spending on process control usually remains steady even when the equipment cycle declines. It also highlighted growing use of extreme ultraviolet lithography (EUV), a chipmaking method for finer features, as a boost for demand in inspection and metrology. (Investing)
Bernstein SocGen kicked off coverage on KLA with an Outperform rating and set a $1,700 price target. The firm projects low double-digit revenue growth alongside mid-double-digit earnings gains in the coming years, despite noting the stock’s valuation appears high compared to peers. (Investing)
The rally wasn’t confined to TSMC’s U.S.-listed shares. Chip-tool makers mostly climbed as well, with investors betting on a pickup in spending across the equipment supply chain, including names like Applied Materials and Lam Research. (Barron’s)
That said, the situation is a double-edged sword. Capex plans often shift quickly if end-demand falters, and tool orders can delay despite chipmakers’ upbeat spending talk. Export controls and customer concentration continue to weigh heavily on U.S. equipment suppliers, while rapid gains leave little margin for any earnings shortfall.
KLA is set to report its second-quarter fiscal 2026 earnings on Jan. 29 at 2 p.m. PT, with the results coming after the U.S. market closes. (Kla)
