01—Abstract
Summary
Summary of the 10-K filed December 12, 2025. Cited figures are marked; the original filing is the authoritative source.
Applied Materials, Inc. (AMAT) reported solid performance for the fiscal year ending October 25, 2025, with net revenue increasing 4% to $28.4 billiona.
The company's core Semiconductor Systems segment continued to be the primary revenue driver, demonstrating strength fueled by strategic customer investments in new capacity and technology transitions, particularly in leading-edge manufacturing and NAND upgrades. The Applied Global Services (AGS) segment also saw growth, primarily from service agreements and spares. Despite a challenging global economic environment and ongoing geopolitical uncertainties that present risks to demand and supply chains, AMAT has maintained strong operational execution.
The company continues to invest significantly in Research, Development, and Engineering (RD&E) to maintain its technology leadership, essential for navigating the rapid pace of innovation in the semiconductor industry. Management expresses confidence that operating cash flow, current cash reserves, and available credit facilities are sufficient to meet liquidity needs for the next 12 months.
02—Key points
Key Highlights
- Net revenue grew 4% year-over-year to $28.4 billion, driven by strong performance in the Semiconductor Systems segment.
- Semiconductor Systems segment revenue increased 4%, fueled by customer investments in leading-edge logic and NAND fabrication.
- Applied Global Services (AGS) segment revenue rose 3%, supported by increased spending on service agreements and spares.
- Gross margin improved to 48.7% from 47.5% due to favorable product mix, higher ASPs, and lower manufacturing costs.
- Operating income saw a 5% increase to $8.3 billion, with operating margin slightly improving to 29.2%.
- The company maintained a strong cash position, with cash and cash equivalents totaling $7.2 billion and total cash, cash equivalents, and investments at $12.9 billion.
- AMAT repurchased $4.9 billion of its common stock in fiscal 2025 and declared $1.4 billion in dividends, reflecting a commitment to returning capital to shareholders.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2025, Applied Materials kept $0.25.
- Revenue$28.37B100.0%
- Cost of revenue−$14.56B51.3%
- Gross profit$13.81B48.7%
- Operating costs−$5.52B19.5%
- Operating income$8.29B29.2%
- Interest, other & tax−$1.29B4.6%
- Net income$7.00B24.7%
Where FY2025 revenue went
$28.37B- Cost of revenue: $14.56B, 51% of revenue
- Net income: $7.00B, 25% of revenue
- R&D: $3.57B, 13% of revenue
- SG&A: $1.77B, 6.2% of revenue
- Other operating costs: $181.0M, 0.6% of revenue
- Interest, other & tax: $1.29B, 4.6% of revenue
Kept 25% as net incomeOther operating costs $181.0M · 0.6%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2025filed December 12, 2025Financial Statements
FY2025 against FY2024
| Line item | FY2025FY2024 | Change |
|---|---|---|
| Revenue | $28.37B$27.18B | +4.4% |
| Cost of Revenue | $14.56B$14.28B | +2.0% |
| Gross Profit | $13.81B$12.90B | +7.1% |
| R&D Expenses | $3.57B$3.23B | +10.4% |
| SG&A Expenses | $1.77B$1.80B | −1.6% |
| Operating Expenses | $5.52B$5.03B | +9.7% |
| Operating Income | $8.29B$7.87B | +5.4% |
| Net Income | $7.00B$7.18B | −2.5% |
| EPS (Basic) | $8.71$8.68 | +0.3% |
| EPS (Diluted) | $8.66$8.61 | +0.6% |
| Shares Outstanding (Basic) | 804.00M827.00M | −2.8% |
| Shares Outstanding (Diluted) | 808.00M834.00M | −3.1% |
05—Questions
Frequently Asked Questions
What are the primary drivers of Applied Materials' revenue growth?
Applied Materials' revenue is primarily driven by customer investments in semiconductor manufacturing equipment and services. Key growth drivers include strategic customer investments in new capacity, technological transitions (such as leading-edge logic and advanced packaging), demand for AI and data center computing, and the growth of emerging end-market drivers like the Internet of Things and autonomous vehicles. The Applied Global Services segment also contributes through services, spares, and factory automation software.
What are the major risks facing Applied Materials?
Applied Materials faces several significant risks, including the cyclical and volatile nature of the semiconductor industry, which can lead to unpredictable customer demand. Other key risks include global economic uncertainty, geopolitical issues affecting trade policies and export regulations (particularly concerning China), supply chain disruptions, intense competition, and cybersecurity threats. The company also notes risks related to managing a global business and potential impacts from new tax laws and regulations.
How is Applied Materials managing its investment in Research, Development, and Engineering (RD&E)?
Applied Materials continues to prioritize significant investments in RD&E as a core part of its long-term growth strategy. These investments are aimed at developing new materials engineering solutions and products that anticipate technology inflections and meet evolving customer requirements. This proactive approach allows customers to incorporate AMAT's latest technologies into their manufacturing plans early in their technology selection process, maintaining the company's competitive edge.
What is the company's approach to returning capital to shareholders?
Applied Materials demonstrates a commitment to returning capital to shareholders through both share repurchases and dividends. In fiscal year 2025, the company repurchased approximately $4.9 billion of its common stock under an expanded $10 billion repurchase program, and paid approximately $1.4 billion in cash dividends. The company anticipates continuing quarterly dividend payments, subject to Board discretion and financial performance.
06—Continue