Applied Materials (NASDAQ:AMAT) Posts Earnings Results, Beats Estimates By $0.19 EPS

Applied Materials (NASDAQ:AMAT) issued its quarterly earnings data on Thursday. The manufacturing equipment provider reported $2.38 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.19 by $0.19, Zacks reports. The business had revenue of $7.01 billion for the quarter, compared to analysts’ expectations of $6.88 billion. Applied Materials had a return on equity of 39.26% and a net margin of 24.67%.The company’s revenue for the quarter was down 2.1% on a year-over-year basis. During the same period in the prior year, the firm earned $2.38 EPS. Applied Materials updated its Q2 2026 guidance to 2.440-2.840 EPS.

Here are the key takeaways from Applied Materials’ conference call:

• Applied expects to grow its semiconductor equipment business more than 20% in calendar 2026, with demand weighted to the second half and Q2 guidance of $7.65B ± $500M revenue and $2.64 ± $0.20 non‑GAAP EPS, and management says momentum should carry into 2027.
• Management emphasizes market leadership in AI‑driven segments—leading‑edge logic, HBM DRAM, and advanced packaging—and plans to launch a dozen+ new products this year while starting EPIC co‑development (with Samsung) to accelerate customer co‑innovation.
• Services and software are strengthening—Applied Global Services reported record revenue of $1.56B (up 15% YoY), and more than 30,000 chambers are connected to AIX, supporting faster response times and double‑digit services growth.
• Results were mixed—Q1 revenue was $7.0B (down 2% YoY) and non‑GAAP EPS of $2.38 was flat; China revenue declined 7% YoY and non‑GAAP operating profit fell 4%, which are near‑term headwinds to watch.
• GAAP results include a $252.5M accrual to resolve a U.S. export‑controls inquiry, and management has opportunistically built ~$500M of extra inventory (days ≈153) to support ramps—both items affect cash and execution risk.

Applied Materials Stock Performance

Shares of NASDAQ:AMAT opened at $328.46 on Friday. The firm has a 50 day moving average of $293.46 and a 200 day moving average of $235.24. The company has a quick ratio of 1.87, a current ratio of 2.61 and a debt-to-equity ratio of 0.32. The company has a market capitalization of $260.71 billion, a price-to-earnings ratio of 37.84, a price-to-earnings-growth ratio of 3.02 and a beta of 1.70. Applied Materials has a 52 week low of $123.74 and a 52 week high of $344.60.

Applied Materials Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, March 12th. Investors of record on Thursday, February 19th will be paid a $0.46 dividend. The ex-dividend date of this dividend is Thursday, February 19th. This represents a $1.84 dividend on an annualized basis and a yield of 0.6%. Applied Materials’s payout ratio is 21.20%.

Insiders Place Their Bets

In other news, SVP Teri A. Little sold 4,000 shares of the business’s stock in a transaction on Tuesday, November 25th. The stock was sold at an average price of $238.24, for a total value of $952,960.00. Following the completion of the transaction, the senior vice president directly owned 84,351 shares of the company’s stock, valued at approximately $20,095,782.24. The trade was a 4.53% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, CAO Adam Sanders sold 609 shares of the company’s stock in a transaction on Monday, December 1st. The stock was sold at an average price of $255.53, for a total value of $155,617.77. Following the sale, the chief accounting officer owned 4,413 shares of the company’s stock, valued at $1,127,653.89. This trade represents a 12.13% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 8,609 shares of company stock worth $2,044,898 over the last quarter. Company insiders own 0.30% of the company’s stock.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently modified their holdings of the company. Triumph Capital Management acquired a new stake in Applied Materials in the third quarter valued at approximately $38,000. Swiss RE Ltd. purchased a new stake in shares of Applied Materials during the 4th quarter valued at $75,000. Rakuten Securities Inc. boosted its position in shares of Applied Materials by 38.9% in the 2nd quarter. Rakuten Securities Inc. now owns 439 shares of the manufacturing equipment provider’s stock worth $80,000 after purchasing an additional 123 shares in the last quarter. McMillan Office Inc. acquired a new stake in shares of Applied Materials in the 4th quarter worth $90,000. Finally, Measured Wealth Private Client Group LLC purchased a new position in Applied Materials during the 3rd quarter worth $110,000. Hedge funds and other institutional investors own 80.56% of the company’s stock.

Trending Headlines about Applied Materials

Here are the key news stories impacting Applied Materials this week:

• Positive Sentiment: Q1 earnings and revenue beat — AMAT reported $2.38 EPS and $7.01B revenue, topping consensus and demonstrating healthy margins and profitability that underpin investor confidence. Applied Materials (AMAT) Beats Q1 Earnings and Revenue Estimates
• Positive Sentiment: Strong forward guidance — management set Q2 FY2026 EPS guidance (2.440–2.840) and revenue targets above Street expectations, signaling continued demand for semiconductor equipment driven by AI processors. This guidance is the key driver of the after‑hours rally. Applied Materials forecasts second-quarter sales above estimates
• Positive Sentiment: AI and industry positioning — analysts and commentary point to accelerating AI/HPC capex (DRAM, advanced logic, packaging) and recurring service revenue as structural growth drivers; several firms have raised targets and reiterated Buy ratings ahead of the print. How to Read Applied Materials Earnings: What Signals Move the Stock?
• Positive Sentiment: Strategic partnerships — Samsung agreed to join AMAT’s new $5B EPIC R&D center, reinforcing customer relationships and R&D scale that support long-term demand and product leadership. Applied Materials Announces Samsung Electronics Will Join the New, Multibillion-Dollar EPIC Center
• Neutral Sentiment: Regulatory closure reduces uncertainty — the DOJ and SEC have closed related investigations without action, which removes a material legal overhang and clarifies near-term risk. That reduced uncertainty likely helped investor reaction even though a settlement was paid. Applied Materials Announces First Quarter 2026 Results
• Negative Sentiment: $252.5M export settlement — AMAT agreed to pay $252.5M to the U.S. Department of Commerce to resolve alleged export-control violations for certain shipments to China (Nov 2020–Jul 2022). The payment is a one‑time hit and raises compliance/controls questions, though management frames the resolution as in shareholders’ best interest. Applied Materials to pay $252 million to resolve illegal chip exports, US says

Analyst Ratings Changes

A number of brokerages have recently issued reports on AMAT. Wells Fargo & Company boosted their target price on shares of Applied Materials from $290.00 to $350.00 and gave the company an “overweight” rating in a research note on Thursday, January 15th. Bank of America lifted their price objective on shares of Applied Materials from $300.00 to $350.00 and gave the company a “buy” rating in a report on Tuesday, January 13th. Stifel Nicolaus boosted their price objective on shares of Applied Materials from $250.00 to $340.00 and gave the company a “buy” rating in a research report on Wednesday, January 14th. Susquehanna raised shares of Applied Materials from a “neutral” rating to a “positive” rating and raised their target price for the stock from $180.00 to $400.00 in a research report on Sunday, January 11th. Finally, B. Riley Financial reaffirmed a “buy” rating on shares of Applied Materials in a research note on Monday. Twenty-four investment analysts have rated the stock with a Buy rating and eight have given a Hold rating to the company’s stock. According to MarketBeat, the stock has an average rating of “Moderate Buy” and a consensus target price of $315.15.

About Applied Materials

Applied Materials, Inc is a U.S.-based supplier of equipment, services and software used to manufacture semiconductor chips, flat panel displays and other advanced materials. Headquartered in Santa Clara, California, the company designs and sells capital equipment and related technologies that enable production of integrated circuits, display panels and materials used across the electronics supply chain.

Applied Materials’ offerings include process equipment and factory software that support critical steps in device fabrication, such as deposition, etch, implantation, inspection and metrology, as well as systems for packaging and advanced heterogeneous integration.