KLA shareholders withheld 187 million votes as rival Lam Research authorized a $25 billion buyback

KLA▲+7.35% — KLA, up 7.35 percent today Corporation's board asked shareholders for a routine endorsement at its annual meeting on November 4 ¹. The ledger it filed with the SEC on November 6↗ records a different answer: three of nine directors drew between 48.8 million and 87.2 million votes against, about 187 million shares withheld in total, roughly 16% of the 1.166 billion shares voted ¹.

The other six directors each drew under 7.3 million ¹. Say-on-pay took 76.8 million votes against ¹. The 8-K records the counts and nothing else: it gives no reason for the concentration of withheld votes on Robert Calderoni, Kevin Kennedy and Michael McMullen ¹.

The vote happened the same week the market marked the stock down

The meeting closed on November 4 ². On November 5 KLA fell 13.3%, and the board declared a $0.23 quarterly dividend that same day, a 0.7% yield on a $180 billion company, payable December 1 ¹²³. By November 6 the stock had lost 30% since August 8, against a 4.7% drop for the S&P 500↗; Applied Materials▲+4.61% — Applied Materials, up 4.61 percent today fell 38% and Lam Research▲+8.64% — Lam Research, up 8.64 percent today 36% over the same stretch ².

The operating case does not explain the sell-off

The September quarter was KLA's best on record: revenue of $4.14 billion, up 29% year over year, a 46.1% operating margin, the first time above 46% in company history, $1.34 billion of free cash flow, and backlog near $13 billion, up about 60% from fiscal 2025 ⁴. December guidance of about $4.7 billion↗ sits above the $4.49 billion Street estimate ⁴. Investors still paid 34.4 times trailing earnings at the November 6 close against 21.8 for the index ².

The capital-return gap is the part shareholders can vote on

Lam Research, the etch-and-deposition toolmaker and closest rival, roughly the same size, authorized a $25 billion buyback on November 5↗, about 9% of its shares outstanding, on top of a $0.33 quarterly dividend ⁵. KLA, the largest maker of chip-inspection equipment, returns 0.7% a year and its insiders sold $42.2 million of stock in 90 days↗, including CEO Richard Wallace's 72,019 shares at $171.88 in September ³⁶.

The votes shareholders withheld from three directors are the instrument they have when the dividend is small and the insider tape is one-sided. What to watch before the next annual meeting is whether KLA's board answers: with capital returns closer to its rival's, with a pay structure fewer shareholders oppose, or with director accountability. The record quarter and the 16% withhold campaign now sit on the same desk ².