KLA's median time to tool retirement has expanded from 4 yrs in 2000 to 24 years today, well above customer depreciation cycle of 5-7 years. Longer shelf life of process nodes contributed to this. The class of 1995 still generates $100M in annual service revenue 30 years later. KLA raised its service business CAGR from 12-14% to 13-15% as the trend of longer shelf life for nodes continue. The service revenue at semicap companies effectively funds dividends.
Source: Sravan Kundojjala
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