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Applied Materials 8-K Report, Financial Results (Feb 12, 2026)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed February 12, 2026
Period End
February 12, 2026
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. Leadership change8-K · Jul ’20Jul ’20
  3. Leadership change8-K · Oct ’22Oct ’22
  4. Material agreement8-K · Feb ’25Feb ’25

01—Abstract

Summary

Summary of the 8-K filed February 12, 2026. Cited figures are marked; the original filing is the authoritative source.

Applied Materials reported fiscal Q1 2026 (quarter ended January 25, 2026) revenue of $7.01 billiona, down 2% year over year, with GAAP EPS of $2.54 (up 75%) and non-GAAP EPS of $2.38 (flat).

The headline GAAP EPS jump is largely driven by a $484 millionb unrealized gain on strategic investments and a lower tax provision, while the underlying operating picture was softer: GAAP operating margin fell to 26.1% from 30.4%, and non-GAAP operating margin slipped to 30.0% from 30.6%. The results also include a $253 million legal settlement with the U.S. Commerce Department's Bureau of Industry and Security over an export controls compliance matter, which weighed on GAAP results. The quarter's operating story is strong demand in AI-related areas.

Semiconductor Systems revenue fell to $5.14 billionc from $5.60 billion, but DRAM rose to 34% of segment revenue from 27%, and management cited record DRAM revenue. Applied Global Services grew revenue 15% to $1.56 billion with a 28.1% operating margin, and management called out record services and spares revenue. Management said it expects its semiconductor equipment business to grow more than 20% in calendar 2026 and has increased inventories and system manufacturing capacity in preparation.

Looking ahead, management guided fiscal Q2 2026 revenue to $7.65 billiond (plus or minus $500 million) and non-GAAP EPS to $2.64 (plus or minus $0.20), implying meaningful sequential growth. Cash generation was solid, with operating cash flow of $1.69 billion and non-GAAP free cash flow of $1.04 billion, nearly double the prior year.

The company returned $702 million to shareholders through $337 million in buybacks and $365 million in dividends. Investors should note that the segment reporting changed this quarter, with the 200-millimeter equipment business moved into Semiconductor Systems and corporate support costs fully allocated, so prior-period figures were recast.

02—Key points

Key Highlights

  1. Revenue of $7.01B, down 2% YoY; GAAP gross margin 49.0% and non-GAAP gross margin 49.1%
  2. GAAP EPS $2.54 (up 75% YoY) versus non-GAAP EPS $2.38 (flat YoY); the GAAP increase reflects a $484M unrealized gain on strategic investments
  3. $253M legal settlement with the U.S. Commerce Department BIS over an export controls compliance matter, reducing GAAP operating income
  4. Operating margin compression: GAAP operating margin 26.1% (down 4.3 points) and non-GAAP 30.0% (down 0.6 points)
  5. DRAM rose to 34% of Semiconductor Systems revenue (from 27%), with record DRAM revenue; Applied Global Services revenue up 15% to $1.56B with record services and spares revenue
  6. Q2 FY2026 guidance: revenue of $7.65B (±$500M) and non-GAAP EPS of $2.64 (±$0.20); management expects semiconductor equipment growth over 20% in calendar 2026
  7. Non-GAAP free cash flow of $1.04B, up 91% YoY; $702M returned to shareholders via buybacks ($337M) and dividends ($365M)

03—Questions

Frequently Asked Questions

  1. Why did GAAP EPS rise 75% while revenue and non-GAAP EPS were flat or down?

    The GAAP increase was driven mainly by a $484 million unrealized gain on strategic investments and a much lower GAAP tax provision ($302M versus $934M a year earlier, which included a $644M deferred tax remeasurement). These items are excluded from non-GAAP results, which is why non-GAAP EPS was flat at $2.38 and non-GAAP net income fell 2%.

  2. How significant is the $253 million legal settlement?

    It is a one-time charge tied to an agreed settlement with the U.S. Commerce Department's Bureau of Industry and Security over a previously disclosed export controls compliance matter. It reduced GAAP operating income and EPS by about $0.32 per share, and Applied excludes it from non-GAAP results. Investors should watch for any ongoing export compliance costs or regulatory restrictions.

  3. What is driving demand, and which segments are strongest?

    Management attributes demand to AI computing investment, particularly leading-edge logic, high-bandwidth memory, and advanced packaging. DRAM became a larger share of Semiconductor Systems revenue (34%, up from 27%), and Applied Global Services grew 15% with a 28.1% operating margin. Semiconductor Systems revenue declined 8% year over year, partly reflecting the segment reporting changes and a shift in mix.

  4. What does the Q2 FY2026 guidance imply?

    Guidance calls for revenue of $7.65 billion (±$500 million) and non-GAAP EPS of $2.64 (±$0.20), which is above Q1's $7.01 billion and $2.38. The EPS outlook includes a $0.04 per share net tax benefill and excludes $0.01 per share of known acquisition-related charges. The range is wide, so the actual outcome could differ materially.

  5. Is the company generating enough cash to fund its capacity build-out and shareholder returns?

    Yes, for now. Operating cash flow was $1.69 billion and non-GAAP free cash flow was $1.04 billion, even with capital expenditures rising to $646 million from $381 million. Cash and short-term investments were about $8.5 billion, and the company returned $702 million to shareholders. Inventories rose to $6.0 billion and other current assets increased, so working capital absorbed cash and is worth monitoring.

04—Continue

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