On July 27, Chip-making tools manufacturer KLA Corp (KLAC. O) announced its first-quarter revenue and profit forecasts, which exceeded Wall Street expectations. The company's positive outlook is attributed to increased investments in artificial intelligence (AI). As consumers and investors show great interest in OpenAI's ChatGPT, businesses from various sectors are rushing to incorporate AI tools, benefiting companies like KLA that play a crucial role in the chip supply chain. KLA stated in a shareholder letter that it is capitalizing on the increasing demand for silicon wafer and photomask manufacturing, which both undergo general capacity expansion. Furthermore, as trade tensions with the US escalate, chip manufacturers are seeking to diversify their supply chains away from China, a trend that has also favored KLA. Major companies like Intel, TSMC, Samsung, Texas Instruments, and Micron are establishing new plants in the United States, resulting in higher demand for chip tools. KLA specializes in the production of tools for inspecting silicon wafer discs for defects, providently supporting the semiconductor industry.

For the first quarter, KLA expects an adjusted profit of $5. 35 per share, with a margin of plus or minus 60 cents, surpassing analysts' projections of $4. 75 per share according to Refinitiv data. In the quarter ending on June 30, the company achieved $2. 36 billion in revenue and an adjusted profit of $5. 40 per share, surpassing estimates of $2. 26 billion and $4. 85 respectively. Notably, 30% of KLA's revenue in the June quarter was derived from China, 21% from Taiwan, and 13% from North America. Additionally, KLA's client, Intel (INTC. O), surprised the market by reporting a profit as the PC market downturn began to stabilize after a challenging year. On a separate note, the top Republican and Democrat in the U. S. House Financial Services committee recently announced their failure to reach an agreement on a bill aimed at establishing a federal regulatory framework for stablecoins—a type of cryptocurrency that is often pegged to a traditional asset, usually the U. S. dollar.