KLA Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

LEASES

LEASES

9 Months Ended

Mar. 31, 2023

We have operating leases for facilities, vehicles and other equipment. Our facility leases are primarily used for administrative functions, research and development (“R&D”), manufacturing, and storage and distribution. Our finance leases are not material.

Our existing leases do not contain significant restrictive provisions or residual value guarantees; however, certain leases contain provisions for the payment of maintenance, real estate taxes or insurance costs by us. Our leases have remaining lease terms ranging from less than one year to 29 years, including periods covered by options to extend the lease when it is reasonably certain that the option will be exercised.

Lease expense was $10.1 million and $29.2 million for the three and nine months ended March 31, 2023, respectively, and $9.2 million and $27.5 million for the three and nine months ended March 31, 2022, respectively. Expense related to short-term leases, which are not recorded on the Condensed Consolidated Balance Sheets, was not material for the three and nine months ended March 31, 2023 and 2022. As of March 31, 2023 and June 30, 2022, the weighted-average remaining lease term was 6.5 and 4.8 years, respectively, and the weighted-average discount rate for operating leases was 3.26% and 2.18%, respectively.

Supplemental cash flow information related to leases was as follows:


	Nine Months Ended March 31,
In thousands	2023		2022
Operating cash outflows from operating leases	$	29,630	$	28,680
Right of use assets obtained in exchange for new operating lease liabilities	$	85,911	$	20,698

Maturities of lease liabilities as of March 31, 2023 were as follows:


Fiscal Year Ending June 30:	(In thousands)
2023 (remaining three months)	$	10,503
2024	33,605
2025	32,942
2026	26,363
2027	21,511
2028 and thereafter	72,457
Total lease payments	197,381
Less imputed interest	(26,048)
Total	$	171,333

As of March 31, 2023, we did not have material leases that had not yet commenced.