Kulicke and Soffa Industries 2025 Q2 Earnings Misses Targets as Net Income Falls 17.7%

Kulicke and Soffa Industries (KLIC) reported its fiscal 2025 Q2 earnings on May 07th, 2025. The company fell short of expectations, missing revenue and earnings targets as it reported a net loss of $84.52 million, which represents a 17.7% reduction from the previous year's net loss. Guidance for the upcoming quarter remains cautious, with revenue projected to be approximately $145 million, plus or minus $10 million. Despite the challenging financial results, the company remains resolute in its strategic direction, emphasizing growth in key technology areas.

Revenue
The total revenue of Kulicke and Soffa Industries decreased by 5.9% to $161.99 million in 2025 Q2, down from $172.07 million in 2024 Q2.

Earnings/Net Income
Kulicke and Soffa Industries narrowed losses to $1.59 per share in 2025 Q2 from a loss of $1.83 per share in 2024 Q2, representing a 13.1% improvement. The EPS reflects ongoing challenges, indicating continued financial pressure.

Post-Earnings Price Action Review
The strategy of buying KLIC shares after a quarter-over-quarter revenue increase and holding for 30 days yielded a 2.75% return over the past five years. This performance significantly lagged behind the benchmark's 84.08% return. The strategy's Sharpe ratio was notably low at 0.07, pointing to inadequate risk-adjusted returns. Furthermore, it experienced a maximum drawdown of -10.92%, underscoring its high risk and emphasizing the necessity of risk management. These figures highlight the strategy's underperformance and the importance of reassessing investment approaches in light of market volatility and company-specific challenges.

CEO Commentary
Fusen Chen, President and Chief Executive Officer, emphasized that Kulicke & Soffa's decision to discontinue the electronics assembly equipment business was essential for aligning with long-term technology trends, aiming for improved competitiveness and financial performance. He highlighted a 38% sequential increase in semiconductor demand driven by low wage and thermal compression bonder markets in the U.S. and China. Chen expressed confidence in the industry's resilience despite current macro uncertainties and the ongoing strategic focus on vertical wire, power semiconductor, and advanced dispense technologies to enhance growth prospects.

Guidance
Kulicke & Soffa anticipates revenue of $145 million, plus or minus $10 million, for the June quarter, with gross margins expected to be 46.5%. The company projects a GAAP EPS loss of $0.09 and a non-GAAP EPS gain of $0.05 per share. Chen noted that the semiconductor unit growth would continue to improve through fiscal 2025, supported by ongoing capacity digestion and utilization rate enhancements.

Additional News
Kulicke & Soffa Industries recently announced a share buyback program, repurchasing 0.5 million shares at a cost of $21.3 million, reflecting confidence in its long-term value despite current challenges. The company is also undergoing significant strategic shifts, including the planned cessation of its Electronics Assembly equipment business. This move, approved by the Board of Directors, is aimed at aligning with evolving technology trends and enhancing financial performance. Additionally, Kulicke & Soffa is focusing on expanding its capabilities in Vertical Wire, Power-Semiconductor, Advanced Dispense, and Thermo-Compression technologies to fortify its market position and drive future growth.