10-QPeriod: Q2 FY2026

APPLIED MATERIALS INC /DE Quarterly Report for Q2 Ended Apr 26, 2026

Filed May 21, 2026For Securities:AMAT

Summary

Applied Materials, Inc. (AMAT) reported a strong financial performance for the quarter ending April 26, 2026, with significant year-over-year increases in revenue and net income. Revenue grew by 11% to $7.91 billion, driven by robust performance in both its Semiconductor Systems and Applied Global Services segments. Net income surged by approximately 31%, reaching $2.81 billion, translating to diluted earnings per share of $3.51, a substantial improvement from the prior year. The company's operational efficiency and strategic investments in research and development appear to be paying off, as evidenced by the expanded gross and operating margins. Despite increased R&D spending, the company managed its general and administrative expenses effectively, contributing to the overall profitability. The strong financial results, coupled with a healthy balance sheet and substantial cash reserves, position AMAT favorably within the dynamic semiconductor industry.

Financial Highlights

58 data points
Beta

Revenue

$7.91B

49.9% Gross Margin

Net Income

$2.81B

35.5% Net Margin

EPS (Diluted)

$3.51

Total Assets

$40.29B

Cash & Equivalents

$6.30B

Free Cash Flow

$210.00M

Financial Statements
Beta
Revenue$7.91B
Cost of Revenue$3.96B
Gross Profit$3.95B
R&D Expenses$1.03B
SG&A Expenses$397.00M
Operating Expenses$1.42B
Operating Income$2.52B
Net Income$2.81B
EPS (Basic)$3.53
EPS (Diluted)$3.51
Shares Outstanding (Basic)794.00M
Shares Outstanding (Diluted)799.00M

Key Highlights

  • 1Revenue increased 11% year-over-year to $7.91 billion for the quarter.
  • 2Net income significantly increased by 31% to $2.81 billion.
  • 3Diluted earnings per share (EPS) rose to $3.51 from $2.63 in the prior year's quarter.
  • 4Gross margin improved to 49.9% from 49.1% in the prior year's quarter.
  • 5Operating margin expanded to 31.9% from 30.5% in the prior year's quarter.
  • 6Cash flow from operations remained strong, totaling $2.53 billion for the first six months of the fiscal year.
  • 7The company continues to return value to shareholders through dividends and share repurchases, with $13.2 billion remaining available under its stock repurchase program.

Frequently Asked Questions

Revenue growth was primarily driven by strong performance in both the Semiconductor Systems segment, which saw a 10% increase year-over-year, and the Applied Global Services (AGS) segment, which experienced a 17% increase. This growth was supported by increased customer spending in Foundry, Logic, and DRAM markets, as well as higher long-term service agreement revenue and customer spending on spares within AGS.

While Research, Development, and Engineering (RD&E) expenses increased to support ongoing investments in product development, the company effectively managed other operating expenses. Marketing and selling expenses saw a modest increase, but General and Administrative (G&A) expenses decreased year-over-year. Notably, the company incurred a significant legal settlement charge of $253 million in the first six months of the fiscal year related to an export controls compliance matter.

The company's strong performance suggests a positive outlook. Management believes that cash generated from operations, combined with existing cash balances and borrowing capacity, will be sufficient to meet liquidity requirements for the next 12 months. Applied Materials continues to focus on returning capital to shareholders through dividends and an active share repurchase program, with a substantial amount still available for future repurchases.

The company faces risks related to the cyclical nature of the semiconductor industry, global economic volatility, geopolitical tensions, global trade issues and export regulations (particularly concerning China), supply chain disruptions, intense competition, intellectual property protection, cybersecurity threats, and the ability to attract and retain key talent. Significant investments in R&D and capital expenditures are ongoing.