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Applied Materials 8-K Report, Financial Results (Feb 15, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed February 15, 2024
Period End
February 15, 2024
Security
AMAT
In the record · 2016–202610-K1010-Q338-K102

AMAT filed 10 annual reports (10-K), 33 quarterly reports (10-Q) and 102 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Sep ’17Sep ’17
  2. Material agreement8-K · May ’20May ’20
  3. Leadership change8-K · Oct ’22Oct ’22
  4. Leadership change8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed February 15, 2024. Cited figures are marked; the original filing is the authoritative source.

Applied Materials reported first-quarter fiscal 2024 results (quarter ended January 28, 2024) with revenue of $6.71 billiona, essentially flat year over year ($6,707M vs. $6,739M).

Profitability held up well: GAAP gross margin expanded 1.1 points to 47.8%, GAAP operating margin was 29.3% (up 0.1 points), and non-GAAP operating margin was flat at 29.5%. GAAP diluted EPS rose 19% to $2.41b, but this was inflated by a $280 million unrealized gain on strategic investments (about $0.33 per share). Non-GAAP diluted EPS was $2.13, up 5% year over year, and the change in useful lives of certain PP&E added $0.03 to both GAAP and non-GAAP EPS.

Non-GAAP net income rose only 3% because the unrealized gain is excluded from that measure. Cash generation was solid, with $2.33 billionc in operating cash flow and $2.10 billion in non-GAAP free cash flow (up 6%). The company returned $966 million to shareholders, including $700 million in buybacks and $266 million in dividends.

Cash and cash equivalents rose to $6.85 billiond, and total stockholders' equity increased to $17.4 billion. The guidance for the second quarter of fiscal 2024 calls for revenue of approximately $6.50 billion (plus or minus $400 million) and non-GAAP diluted EPS of $1.79 to $2.15. The guidance range is wide, which reflects uncertainty.

The mix shift is also notable: China rose to 45% of revenue from 17% a year earlier, while Taiwan fell to 8% from 29%. Management emphasized that leadership at key semiconductor inflections should support outperformance as customers ramp chip technologies tied to AI and IoT. Investors should weigh the strong cash position and shareholder returns against flat core revenue, the heavy reliance on China, and the wide forward EPS range.

02—Key points

Key Highlights

  1. Revenue of $6.71B was flat year over year; GAAP gross margin rose 1.1 points to 47.8% and non-GAAP gross margin rose to 47.9%.
  2. GAAP diluted EPS of $2.41 (up 19%) was boosted by a $280M unrealized gain on strategic investments (~$0.33/share); non-GAAP EPS was $2.13 (up 5%).
  3. Non-GAAP operating margin held flat at 29.5%; Semiconductor Systems non-GAAP operating margin declined to 35.7% from 36.1%, while Applied Global Services improved to 28.3% from 25.2%.
  4. China revenue jumped to $3.0B (45% of total) from $1.1B (17%), while Taiwan fell to $559M (8%) from $1.97B (29%), signaling a major geographic mix shift.
  5. Operating cash flow of $2.33B and non-GAAP free cash flow of $2.10B (up 6%) supported $966M in shareholder returns ($700M buybacks, $266M dividends).
  6. Q2 FY2024 guidance: revenue of ~$6.50B (±$400M) and non-GAAP diluted EPS of $1.79–$2.15, a wide range that signals limited near-term visibility.
  7. Balance sheet strengthened: cash and equivalents rose to $6.85B and stockholders' equity increased to $17.4B, while total debt stayed roughly flat at about $5.6B.

03—Questions

Frequently Asked Questions

  1. Why did GAAP EPS grow 19% while non-GAAP EPS grew only 5%?

    The gap comes mainly from a $280 million unrealized gain on strategic investments, worth about $0.33 per diluted share. GAAP results include this gain, but non-GAAP results exclude it. Non-GAAP EPS of $2.13 is the better measure of underlying operating performance for the quarter.

  2. Is Applied Materials' revenue growing?

    Not in this quarter. Net revenue was $6.71B versus $6.74B a year earlier, essentially flat. The company attributed its resilience to leadership positions in key semiconductor inflections, but top-line growth was not evident in Q1 FY2024.

  3. How concentrated is the company's revenue by geography?

    Revenue is heavily concentrated in China, which accounted for 45% of Q1 FY2024 revenue ($2.997B), up from 17% a year earlier. Taiwan dropped to 8% from 29%, and the United States fell to 11% from 16%. This shift adds exposure to export-control and trade-policy risk, which the forward-looking statements explicitly flag.

  4. What should investors expect for the next quarter?

    Management guided Q2 FY2024 revenue to about $6.50B (±$400M) and non-GAAP diluted EPS to $1.79–$2.15. The range is wide, and it excludes unknown acquisition charges and other unusual items. Investors should expect meaningful uncertainty around the outlook.

  5. How is the company returning capital to shareholders?

    In Q1 FY2024 Applied returned $966M, including $700M in share repurchases and $266M in dividends. Repurchases rose sharply from $250M a year earlier, and the company generated enough free cash flow ($2.10B) to fund these returns while still building cash to $6.85B.

04—Continue

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