Summary
Applied Materials Inc. reported strong financial results for the first quarter of fiscal year 2018, with net sales surging 28% year-over-year to $4.204 billion. This growth was primarily driven by robust customer investments across all segments, particularly in semiconductor manufacturing equipment. The Semiconductor Systems segment saw a significant 32% increase in net sales, reflecting strong demand in foundry, logic, and memory markets. The Applied Global Services segment also experienced substantial growth of 30%, indicating strong demand for spares and services. Despite the impressive revenue growth and a 1.6 percentage point improvement in gross margin to 45.7%, net income saw a significant decrease of 81% to $135 million. This decline is largely attributable to a substantial $1.0 billion income tax expense related to the U.S. Tax Cuts and Jobs Act, which reduced earnings per diluted share by $0.94. Excluding this one-time tax impact and other adjustments, non-GAAP adjusted net income was $1.135 billion, and adjusted earnings per diluted share was $1.06, demonstrating the underlying operational strength of the business.
Financial Highlights
54 data points| Revenue | $4.20B |
| Cost of Revenue | $2.27B |
| Gross Profit | $1.94B |
| R&D Expenses | $489.00M |
| Operating Expenses | $725.00M |
| Operating Income | $1.22B |
| Interest Expense | $59.00M |
| Net Income | $165.00M |
| EPS (Basic) | $0.16 |
| EPS (Diluted) | $0.15 |
| Shares Outstanding (Basic) | 1.06B |
| Shares Outstanding (Diluted) | 1.07B |
Key Highlights
- 1Net sales increased significantly by 28% year-over-year to $4.204 billion, driven by strong demand across all segments.
- 2Semiconductor Systems segment showed robust growth with net sales up 32% to $2.847 billion, fueled by foundry, logic, and memory demand.
- 3Gross margin improved by 1.6 percentage points to 45.7%, benefiting from increased net sales and favorable product mix.
- 4A significant one-time income tax expense of $1.0 billion related to the U.S. Tax Cuts and Jobs Act dramatically reduced reported net income to $135 million and EPS to $0.13.
- 5Excluding the tax impact and other adjustments, non-GAAP adjusted net income was $1.135 billion, and adjusted EPS was $1.06, highlighting strong operational performance.
- 6The company repurchased $782 million of its common stock during the quarter, indicating a commitment to returning capital to shareholders.
- 7Cash generated from operating activities increased substantially to $1.466 billion, up from $792 million in the prior year period.