Overview
Semiconductor equipment maker's Q1 revenue fell 2% yr/yr, beating analyst expectations
Adjusted EPS for Q1 remained flat yr/yr, beating analyst expectations
Company achieved record DRAM and services revenue in Q1
Outlook
Applied Materials expects Q2 FY2026 revenue of $7.65 bln +/- $500 mln
Company anticipates Q2 FY2026 non-GAAP EPS of $2.64 +/- $0.20
Applied Materials expects semiconductor equipment business growth over 20% in 2026
Result Drivers
AI INVESTMENTS - Co said results were driven by increased industry investments in AI computing, boosting demand for high-performance chips
RECORD DRAM REVENUE - Semiconductor Systems segment achieved record DRAM revenue in Q1
RECORD SERVICES REVENUE - Applied Global Services delivered record services and spares revenue
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q1 Sales | Beat | $7.01 bln | $6.87 bln (25 Analysts) |
Q1 Adjusted EPS | Beat | $2.38 | $2.20 (25 Analysts) |
Q1 EPS | $2.54 | ||
Q1 Net Income | $2.03 bln | ||
Q1 Adjusted Free Cash Flow | $1.04 bln | ||
Q1 Adjusted Gross Margin | 49.1% | ||
Q1 Adjusted Operating Margin | 30% |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 28 "strong buy" or "buy", 9 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the semiconductor equipment & testing peer group is "buy"
Wall Street's median 12-month price target for Applied Materials Inc is $360.00, about 5.9% above its February 11 closing price of $339.88
The stock recently traded at 33 times the next 12-month earnings vs. a P/E of 25 three months ago
Press Release: ID:nGNX2wJ01b
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)