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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
10-Q
(Mark one)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2022
or
☐TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission File Number 000-09992
KLA CORPORATION
(Exact name of registrant as specified in its charter)
 
Delaware 04-2564110
(State or other jurisdiction of
incorporation or organization)		 (I.R.S. Employer
Identification No.)
One Technology Drive,Milpitas,California95035
(Address of Principal Executive Offices)(Zip Code)
(408) 875-3000
(Registrant’s telephone number, including area code) 
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.001 par value per shareKLACThe Nasdaq Stock Market, LLC
The Nasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer☒Accelerated filer ☐
Non-accelerated filer ☐Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐    No  ☒
As of October 17, 2022, there were 141,718,327 shares of the registrant’s Common Stock, $0.001 par value per share, outstanding.

INDEX
 
  Page
Number
PART IFINANCIAL INFORMATION
Item 1.
Condensed Consolidated Balance Sheets as of September 30, 2022 and June 30, 2022
Item 2.
Item 3.
Item 4.
PART IIOTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.


 
2
PART I. FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS
KLA CORPORATION
Condensed Consolidated Balance Sheets
(Unaudited)
 
(In thousands)September 30,
2022		June 30,
2022
ASSETS
Current assets:
Cash and cash equivalents$1,819,280 $1,584,908 
Marketable securities1,134,240 1,123,100 
Accounts receivable, net1,857,320 1,811,877 
Inventories2,408,325 2,146,889 
Other current assets424,774 502,137 
Total current assets7,643,939 7,168,911 
Land, property and equipment, net913,002 849,929 
Goodwill2,278,827 2,320,049 
Deferred income taxes662,408 579,173 
Purchased intangible assets, net1,131,445 1,194,414 
Other non-current assets494,031 484,612 
Total assets$13,123,652 $12,597,088 
LIABILITIES, NON-CONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$479,707 $443,338 
Deferred system revenue440,477 500,969 
Deferred service revenue362,832 381,737 
Other current liabilities1,856,348 1,545,039 
Total current liabilities3,139,364 2,871,083 
Long-term debt6,312,749 6,660,718 
Deferred tax liabilities557,832 658,937 
Deferred service revenue129,861 124,618 
Other non-current liabilities881,772 882,642 
Total liabilities11,021,578 11,197,998 
Commitments and contingencies (Notes 9, 14 and 15)
Stockholders’ equity:
Common stock and capital in excess of par value1,041,948 1,061,940 
Retained earnings1,118,967 366,882 
Accumulated other comprehensive loss(58,841)(27,471)
Total KLA stockholders’ equity2,102,074 1,401,351 
Non-controlling interest in consolidated subsidiaries— (2,261)
Total stockholders’ equity2,102,074 1,399,090 
Total liabilities and stockholders’ equity$13,123,652 $12,597,088 
See accompanying notes to Condensed Consolidated Financial Statements (unaudited).
3
KLA CORPORATION
Condensed Consolidated Statements of Operations
(Unaudited)
 
Three Months Ended September 30,
(In thousands, except per share amounts)20222021
Revenues:
Product$2,195,609 $1,629,888 
Service528,815 453,950 
Total revenues2,724,424 2,083,838 
Costs and expenses:
Costs of revenues1,041,226 813,624 
Research and development318,515 258,153 
Selling, general and administrative253,980 193,261 
Interest expense74,395 38,312 
Loss on extinguishment of debt13,286 — 
Other expense (income), net(47,006)14,140 
Income before income taxes1,070,028 766,348 
Provision (benefit) for income taxes43,963 (302,137)
Net income1,026,065 1,068,485 
Less: Net loss attributable to non-controlling interest74 68 
Net income attributable to KLA$1,025,991 $1,068,417 
Net income per share attributable to KLA
Basic$7.23 $7.01 
Diluted$7.20 $6.96 
Weighted-average number of shares:
Basic141,829 152,330 
Diluted142,563 153,410 
See accompanying notes to Condensed Consolidated Financial Statements (unaudited).
4
KLA CORPORATION
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
Three Months Ended September 30,
(In thousands)20222021
Net income $1,026,065 $1,068,485 
Other comprehensive income (loss):
Currency translation adjustments:
Cumulative currency translation adjustments(19,712)(2,755)
Income tax benefit— 317 
Net change related to currency translation adjustments(19,712)(2,438)
Cash flow hedges:
Net unrealized gains arising during the period1,768 852 
Reclassification adjustments for net gains included in net income(10,175)(1,218)
Income tax (provision) benefit1,188 (61)
Net change related to cash flow hedges(7,219)(427)
Net change related to unrecognized losses and transition obligations in connection with defined benefit plans891 628 
Available-for-sale securities:
Net unrealized losses arising during the period(6,964)(317)
Reclassification adjustments for net (gains) losses included in net income174 (1)
Income tax benefit1,460 68 
Net change related to available-for-sale securities(5,330)(250)
Other comprehensive loss(31,370)(2,487)
Less: Comprehensive loss attributable to non-controlling interest74 68 
Total comprehensive income attributable to KLA$994,621 $1,065,930 
See accompanying notes to Condensed Consolidated Financial Statements (unaudited).
5
KLA CORPORATION
Condensed Consolidated Statements of Stockholders’ Equity
(Unaudited)
Common Stock and
Capital in Excess of
Par Value		Retained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)
Total KLA
Stockholders’
Equity
Non-
Controlling
Interest
Total
Stockholders’
Equity
(In thousands, except per share amounts)SharesAmount
Balances as of June 30, 2022141,804 $1,061,940 $366,882 $(27,471)$1,401,351 $(2,261)$1,399,090 
Net income attributable to KLA— — 1,025,991 — 1,025,991 — 1,025,991 
Net income attributable to non-controlling interest— — — — — 74 74 
Other comprehensive loss — — — (31,370)(31,370)— (31,370)
Net issuance under employee stock plans171 (54,950)— — (54,950)— (54,950)
Repurchase of common stock(257)(1,926)(87,690)— (89,616)— (89,616)
Cash dividends ($1.30 per share) and dividend equivalents declared
— — (186,216)— (186,216)— (186,216)
Stock-based compensation expense— 34,982 — — 34,982 — 34,982 
Purchase of non-controlling interest— 1,902 — — 1,902 (6,196)(4,294)
Disposal of non-controlling interest— — — — — 8,383 8,383 
Balances as of September 30, 2022141,718 $1,041,948 $1,118,967 $(58,841)$2,102,074 $— $2,102,074 

Common Stock and
Capital in Excess of
Par Value		Retained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)
Total KLA
Stockholders’
Equity
Non-
Controlling
Interest
Total
Stockholders’
Equity
(In thousands, except per share amounts)SharesAmount
Balances as of June 30, 2021152,776 $2,175,988 $1,277,123 $(75,557)$3,377,554 $(1,912)$3,375,642 
Net income attributable to KLA— — 1,068,417 — 1,068,417 — 1,068,417 
Net income attributable to non-controlling interest— — — — — 68 68 
Other comprehensive loss — — — (2,487)(2,487)— (2,487)
Net issuance under employee stock plans160 (46,532)— — (46,532)— (46,532)
Repurchase of common stock(1,190)(16,966)(382,711)— (399,677)— (399,677)
Cash dividends ($1.05 per share) and dividend equivalents declared
— — (161,561)— (161,561)— (161,561)
Stock-based compensation expense— 25,216 — — 25,216 — 25,216 
Balances as of September 30, 2021151,746 $2,137,706 $1,801,268 $(78,044)$3,860,930 $(1,844)$3,859,086 
See accompanying notes to Condensed Consolidated Financial Statements (unaudited).
6

KLA CORPORATION
Condensed Consolidated Statements of Cash Flows
(Unaudited)
 Three Months Ended September 30,
(In thousands)20222021
Cash flows from operating activities:
Net income$1,026,065 $1,068,485 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization101,938 84,824 
Loss on extinguishment of debt13,286 — 
Unrealized foreign exchange loss and other1,783 15,639 
Asset impairment charges9,156 5,962 
Disposal of non-controlling interest8,270 — 
Stock-based compensation expense34,982 25,216 
Gain on sale of business(29,687)— 
Deferred income taxes(156,226)(427,970)
Changes in assets and liabilities, net of assets acquired and liabilities assumed in business acquisitions:
Accounts receivable(55,073)(180,354)
Inventories(265,530)(138,189)
Other assets45,637 4,673 
Accounts payable36,472 41,868 
Deferred system revenue(60,492)33,469 
Deferred service revenue(12,411)4,912 
Other liabilities313,375 325,262 
Net cash provided by operating activities1,011,545 863,797 
Cash flows from investing activities:
Net proceeds from sale of business75,358 — 
Business acquisitions, net of cash acquired(27,144)(37,986)
Capital expenditures(84,352)(68,955)
Purchases of available-for-sale securities(256,793)(264,000)
Proceeds from sale of available-for-sale securities26,608 14,954 
Proceeds from maturity of available-for-sale securities211,465 178,414 
Purchases of trading securities(19,512)(22,896)
Proceeds from sale of trading securities19,875 25,163 
Proceeds from other investments1,020 — 
Net cash used in investing activities(53,475)(175,306)
Cash flows from financing activities:
Payment of debt issuance costs(6,515)— 
Proceeds from revolving credit facility300,000 300,000 
Repayment of debt(662,250)(300,000)
Common stock repurchases(89,846)(399,677)
Payment of dividends to stockholders(187,984)(162,821)
Issuance of common stock115 — 
Tax withholding payments related to vested and released restricted stock units(54,952)(46,532)
Purchase of non-controlling interest(4,295)— 
Net cash used in financing activities(705,727)(609,030)
Effect of exchange rate changes on cash and cash equivalents(17,971)(4,507)
Net increase in cash and cash equivalents234,372 74,954 
Cash and cash equivalents at beginning of period1,584,908 1,434,610 
Cash and cash equivalents at end of period$1,819,280 $1,509,564 
Supplemental cash flow disclosures:
Income taxes paid, net$101,061 $57,532 
Interest paid$44,216 $39,717 
Non-cash activities:
Contingent consideration payable - financing activities$145 $12,810 
Dividends payable - financing activities$1,942 $1,783 
Unsettled common stock repurchase - financing activities$— $5,999 
Accrued purchases of land, property and equipment - investing activities$34,027 $22,962 
See accompanying notes to Condensed Consolidated Financial Statements (unaudited).
7
KLA CORPORATION
Notes to Condensed Consolidated Financial Statements
(Unaudited)

NOTE 1 – BASIS OF PRESENTATION
Basis of Presentation. For purposes of this report, “KLA,” the “Company,” “we,” “our,” “us” or similar references mean KLA Corporation and its majority-owned subsidiaries unless the context requires otherwise. The Condensed Consolidated Financial Statements have been prepared by us pursuant to the rules and regulations of the U.S. Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations.
The unaudited interim Condensed Consolidated Financial Statements do not include all of the information and footnotes required by GAAP for audited financial statements. The balance sheet as of June 30, 2022 was derived from the Company’s audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2022 but does not include all disclosures required by GAAP for audited financial statements. The unaudited interim Condensed Consolidated Financial Statements reflect all adjustments (consisting only of normal, recurring adjustments) necessary for a fair statement of the financial position, results of operations, comprehensive income, stockholders’ equity and cash flows for the periods indicated. These Condensed Consolidated Financial Statements and notes, however, should be read in conjunction with Item 8 “Financial Statements and Supplementary Data” included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2022.
The Condensed Consolidated Financial Statements include the accounts of KLA and its majority-owned subsidiaries. All significant intercompany balances and transactions have been eliminated.
The results of operations for the three months ended September 30, 2022 are not necessarily indicative of the results that may be expected for any other interim period or for the full fiscal year ending June 30, 2023.
Management Estimates. The preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions in applying our accounting policies that affect the reported amounts of assets and liabilities (and related disclosure of contingent assets and liabilities) at the date of the Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.
Significant Accounting Policies. There have been no material changes to our significant accounting policies summarized in Note 1 “Description of Business and Summary of Significant Accounting Policies” to our Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2022.
Recent Accounting Pronouncements
Recently Adopted
None

Updates Not Yet Effective
In October 2021, the Financial Accounting Standards Board issued Accounting Standards Update 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. The new guidance requires companies to apply revenue guidance to recognize and measure contract assets and contract liabilities from contracts with customers acquired in a business combination at carrying value. Under the current business combination guidance, such assets and liabilities are recognized by the acquirer at fair value on the acquisition date. This update is effective for us in the first quarter of our fiscal year ending June 30, 2024, and should be applied on a prospective basis. Early adoption is permitted. The impact of adopting this update will depend on the magnitude of contract assets and contract liabilities acquired in future acquisitions.
8
NOTE 2 – REVENUE
Contract Balances
The following table represents the opening and closing balances of accounts receivable, net, contract assets and contract liabilities as of the indicated dates.
As ofAs of
(Dollar amounts in thousands)September 30, 2022June 30, 2022$ Change% Change
Accounts receivable, net$1,857,320 $1,811,877 $45,443 3 %
Contract assets$114,086 $114,747 $(661)(1)%
Contract liabilities$933,170 $1,007,324 $(74,154)(7)%
Our payment terms and conditions vary by contract type, although the terms generally include a requirement of payment of 70% to 90% of total contract consideration within 30 to 60 days of product shipment, with the remainder payable within 30 days of acceptance.
The change in contract assets during the three months ended September 30, 2022 was mainly due to $49.6 million of contract assets reclassified to net accounts receivable as our right to consideration for these contract assets became unconditional, largely offset by $49.3 million of revenue recognized for which the payment is subject to conditions other than passage of time. Contract assets are included in other current assets on our Condensed Consolidated Balance Sheets.
The change in contract liabilities during the three months ended September 30, 2022 was mainly due to the recognition in revenue of $489.5 million that was included in contract liabilities as of June 30, 2022, partially offset by an increase in the value of products and services billed to customers for which control of the products and services has not transferred to the customers. The change in contract liabilities during the three months ended September 30, 2021 was mainly due to an increase in the value of products and services billed to customers for which control of the products and services has not transferred to the customers, partially offset by the recognition in revenue of $303.0 million that was included in contract liabilities as of June 30, 2021. Contract liabilities are included in current and non-current liabilities on our Condensed Consolidated Balance Sheets.

Remaining Performance Obligations

As of September 30, 2022, we had $13.65 billion of remaining performance obligations, which represents our obligation to deliver products and services, and primarily consists of sales orders where written customer requests have been received. This amount excludes contract liabilities of $0.93 billion as described above. We expect to recognize approximately 45% to 55% of these performance obligations as revenue beyond the next 12 months, but this estimate is subject to constant change depending upon supply chain constraints, customer slot change requests and potential elevated demand levels, which could require even longer lead times. In October 2022, the U.S. government issued new regulations to control U.S. semiconductor and high-performance computing technology (including wafer fab equipment) and related support by U.S. persons to the People’s Republic of China (“China”). The regulations impose export license requirements effectively on all KLA products and services to customers located in China that fabricate certain advanced logic, NAND and DRAM integrated circuits (“IC”). KLA is also restricted from providing certain U.S. origin tools, software and technology to certain wafer fab equipment manufacturers and maskshops located in China, absent an export license. These regulations are complex, and we are working on assessing their potential impact. We are taking appropriate measures to comply with these regulations and are applying for export licenses, when required, to avoid disruption to our customers’ operations. While some export licenses have been obtained by us or our customers, there can be no assurance that export licenses applied for by either us or our customers will be granted.
Refer to Note 18 “Segment Reporting and Geographic Information” to our Condensed Consolidated Financial Statements for information related to revenues by geographic region as well as significant product and service offerings.
NOTE 3 – FAIR VALUE MEASUREMENTS
Our financial assets and liabilities are measured and recorded at fair value, except for our debt and certain equity investments in privately held companies. Equity investments without a readily available fair value are accounted for using the measurement alternative. The measurement alternative is calculated as cost minus impairment, if any, plus or minus changes resulting from observable price changes. See Note 8 “Debt” to our Condensed Consolidated Financial Statements for disclosure of the fair value of our Senior Notes, as defined in that Note.
Our non-financial assets, such as goodwill, intangible assets, and land, property and equipment, are assessed for impairment when an event or circumstance indicates that an other-than-temporary decline in value may have occurred.
9
Fair Value of Financial Instruments. We have evaluated the estimated fair value of financial instruments using available market information and valuations as provided by third-party sources. The use of different market assumptions and/or estimation methodologies could have a significant effect on the estimated fair value amounts. The fair value of our cash equivalents, accounts receivable, accounts payable and other current assets and liabilities approximate their carrying amounts due to the relatively short maturity of these items.
Fair Value Hierarchy. The authoritative guidance for fair value measurements establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:
Level 1Valuations based on quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
Level 2Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.
Level 3Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. There were no transfers between Level 1, Level 2 and Level 3 fair value measurements during the three months ended September 30, 2022.
The types of instruments valued based on quoted market prices in active markets include money market funds, certain U.S. Treasury securities, U.S. Government agency securities and equity securities. Such instruments are generally classified within Level 1 of the fair value hierarchy.
The types of instruments valued based on other observable inputs include corporate debt securities, sovereign securities, municipal securities, and certain U.S. Treasury securities. The market inputs used to value these instruments generally consist of market yields, reported trades and broker/dealer quotes. Such instruments are generally classified within Level 2 of the fair value hierarchy.
The principal market in which we execute our foreign currency contracts is the institutional market in an over-the-counter environment with a relatively high level of price transparency. The market participants generally are large financial institutions. Our foreign currency contracts’ valuation inputs are based on quoted prices and quoted pricing intervals from public data sources and do not involve management judgment. These contracts are typically classified within Level 2 of the fair value hierarchy.
The fair values of deferred payments and contingent consideration payable, the majority of which were recorded in connection with business combinations, were classified as Level 3 and estimated using significant inputs that were not observable in the market. See Note 6 “Business Combinations and Dispositions” to our Condensed Consolidated Financial Statements for additional information.
10
Financial assets (excluding cash held in operating accounts and time deposits) and liabilities measured at fair value on a recurring basis, as of the date indicated below, were presented on our Condensed Consolidated Balance Sheets as follows:
Quoted Prices in Active Markets for Identical AssetsSignificant Other Observable InputsLittle or No Market Activity Inputs
As of September 30, 2022 (In thousands)Total (Level 1) (Level 2) (Level 3)
Assets
Cash equivalents:
Money market funds and other$1,050,327 $1,050,327 $— $— 
U.S. Treasury securities4,992 — 4,992 — 
Marketable securities:
Corporate debt securities465,354 — 465,354 — 
Municipal securities48,971 — 48,971 — 
Sovereign securities5,979 — 5,979 — 
U.S. Government agency securities76,702 76,702 — — 
U.S. Treasury securities427,226 408,477 18,749 — 
Equity securities13,086 13,086 — — 
Total cash equivalents and marketable securities(1)
2,092,637 1,548,592 544,045 — 
Other current assets:
Derivative assets44,989 — 44,989 — 
Other non-current assets:
Executive Deferred Savings Plan213,824 167,944 45,880 — 
Total financial assets(1)
$2,351,450 $1,716,536 $634,914 $— 
Liabilities
Derivative liabilities$(43,087)$— $(43,087)$— 
Deferred payments(2,425)— — (2,425)
Contingent consideration payable(23,820)— — (23,820)
Total financial liabilities$(69,332)$— $(43,087)$(26,245)
________________
(1) Excludes cash of $591.1 million held in operating accounts and time deposits of $269.8 million (of which $172.8 million were cash equivalents) as of September 30, 2022.
11
Financial assets (excluding cash held in operating accounts and time deposits) and liabilities measured at fair value on a recurring basis, as of the date indicated below, were presented on our Condensed Consolidated Balance Sheets as follows: 
Quoted Prices in Active Markets for Identical AssetsSignificant Other Observable InputsLittle or No Market Activity Inputs
As of June 30, 2022 (In thousands)Total(Level 1)(Level 2)(Level 3)
Assets
Cash equivalents:
Corporate debt securities$922 $— $922 $— 
Money market funds and other948,027 948,027 — — 
U.S. Treasury securities22,485 — 22,485 — 
Marketable securities:
Corporate debt securities472,047 — 472,047 — 
Municipal securities60,724 — 60,724 — 
Sovereign securities5,990 — 5,990 — 
U.S. Government agency securities91,116 91,116 — — 
U.S. Treasury securities348,026 344,559 3,467 — 
Equity securities11,035 11,035 — — 
Total cash equivalents and marketable securities(1)
1,960,372 1,394,737 565,635 — 
Other current assets:
Derivative assets40,311 — 40,311 — 
Other non-current assets:
Executive Deferred Savings Plan224,188 176,928 47,260 — 
Total financial assets(1)
$2,224,871 $1,571,665 $653,206 $— 
Liabilities
Derivative liabilities$(34,315)$— $(34,315)$— 
Deferred payments(2,350)— — (2,350)
Contingent consideration payable(23,674)— — (23,674)
Total financial liabilities$(60,339)$— $(34,315)$(26,024)
________________
(1) Excludes cash of $472.8 million held in operating accounts and time deposits of $274.9 million (of which $140.7 million were cash equivalents) as of June 30, 2022.

12
NOTE 4 – FINANCIAL STATEMENT COMPONENTS
Condensed Consolidated Balance Sheets
As ofAs of
(In thousands)September 30, 2022June 30, 2022
Accounts receivable, net:
Accounts receivable, gross$1,884,328 $1,832,508 
Allowance for credit losses(27,008)(20,631)
$1,857,320 $1,811,877 
Inventories:
Customer service parts$422,983 $402,121 
Raw materials1,183,244 1,042,916 
Work-in-process527,359 451,782 
Finished goods274,739 250,070 
$2,408,325 $2,146,889 
Other current assets:
Deferred costs of revenues$117,341 $124,487 
Contract assets114,086 114,747 
Prepaid expenses100,027 108,942 
Prepaid income and other taxes31,009 89,713 
Other current assets62,311 64,248 
$424,774 $502,137 
Land, property and equipment, net:
Land$72,288 $67,846 
Buildings and leasehold improvements728,948 712,751 
Machinery and equipment805,466 819,191 
Office furniture and fixtures46,213 44,957 
Construction-in-process150,974 110,079 
1,803,889 1,754,824 
Less: accumulated depreciation(