10-KPeriod: FY2015

APPLIED MATERIALS INC /DE Annual Report, Year Ended Oct 25, 2015

Filed December 9, 2015For Securities:AMAT

Summary

Applied Materials, Inc. (AMAT) reported solid performance in its fiscal year ending October 24, 2015, with net sales reaching $9.66 billion, a 6% increase year-over-year. The company's core Silicon Systems segment continued to be the largest revenue driver, showing a 3% increase in net sales to $6.14 billion, bolstered by increased investment from memory customers. The Applied Global Services segment also demonstrated robust growth with a 15% increase in net sales to $2.53 billion, indicating the company's success in capturing the after-market services business. The company's strategic investments in Research, Development, and Engineering (RD&E) remained a priority, with $1.45 billion allocated in fiscal 2015, focusing on advancements in etch, chemical vapor deposition, and inspection technologies. While the Display segment saw a significant 27% jump in net sales to $780 million, the Energy and Environmental Solutions segment experienced a decline in net sales by 24% to $213 million, reflecting ongoing challenges in the solar industry. Overall, Applied Materials demonstrated resilience in a dynamic market, supported by strong demand in its key semiconductor-related businesses and a commitment to innovation.

Financial Highlights

60 data points
Beta

Revenue

$9.66B

40.9% Gross Margin

Net Income

$1.38B

14.3% Net Margin

EPS (Diluted)

$1.12

Total Assets

$15.31B

Cash & Equivalents

$4.80B

Free Cash Flow

$948.00M

Financial Statements
Beta
Revenue$9.66B
Cost of Revenue$5.71B
Gross Profit$3.95B
R&D Expenses$1.45B
Operating Expenses$2.26B
Operating Income$1.69B
Interest Expense$103.00M
Net Income$1.38B
EPS (Basic)$1.13
EPS (Diluted)$1.12
Shares Outstanding (Basic)1.21B
Shares Outstanding (Diluted)1.23B

Key Highlights

  • 1Net sales increased by 6% to $9.66 billion in fiscal 2015, driven by growth in semiconductor and services segments.
  • 2The Silicon Systems segment, the largest contributor, saw net sales of $6.14 billion, up 3%, with memory customers increasing investments.
  • 3Applied Global Services reported a 15% increase in net sales to $2.53 billion, highlighting the strength of the services business.
  • 4The Display segment experienced a significant 27% increase in net sales to $780 million.
  • 5Research, Development, and Engineering (RD&E) investments remained strong at $1.45 billion, focusing on key technology areas like etch and deposition.
  • 6The Energy and Environmental Solutions segment faced headwinds, with net sales declining 24% to $213 million due to ongoing solar industry challenges.
  • 7Backlog increased 8% to $3.14 billion by the end of fiscal 2015, signaling future revenue potential.

Frequently Asked Questions

In fiscal year 2015, Applied Materials achieved net sales of $9.66 billion, representing a 6% increase from the previous year. The company demonstrated growth across its key segments, particularly in Silicon Systems and Applied Global Services, driven by investments in semiconductor technology and a strong services business.

The Silicon Systems segment, representing 64% of net sales, grew 3% to $6.14 billion, primarily due to increased investment from memory customers. The Applied Global Services segment saw a robust 15% increase in net sales to $2.53 billion. The Display segment also performed well with a 27% rise in net sales to $780 million. However, the Energy and Environmental Solutions segment experienced a 24% decline in net sales to $213 million, reflecting continued softness in the solar market.

Applied Materials continues to prioritize innovation, investing $1.45 billion in Research, Development, and Engineering (RD&E) in fiscal 2015. These investments are focused on developing new products and technologies to address key customer challenges in areas such as advanced etch, chemical vapor deposition, and inspection technologies, crucial for enabling next-generation semiconductor devices.

The company expects the mobility trend to remain a primary driver for the semiconductor industry and its Silicon Systems segment in fiscal 2016. Applied anticipates continued demand for semiconductor equipment from foundry and memory customers, as well as healthy performance in semiconductor spares and services, and display equipment.