Applied Materials (NASDAQ:AMAT) Issues Earnings Results, Beats Expectations By $0.19 EPS

Applied Materials (NASDAQ:AMAT) issued its earnings results on Thursday. The manufacturing equipment provider reported $2.38 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $2.19 by $0.19, Zacks reports. The firm 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 38.52% and a net margin of 27.78%.The company’s revenue was down 2.1% compared to the same quarter last year. During the same quarter last year, the business earned $2.38 earnings per share. 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

NASDAQ:AMAT opened at $354.91 on Friday. The firm has a market capitalization of $281.70 billion, a P/E ratio of 36.33, a P/E/G ratio of 2.92 and a beta of 1.70. Applied Materials has a twelve month low of $123.74 and a twelve month high of $376.32. The company has a fifty day moving average of $295.20 and a 200-day moving average of $236.38. The company has a quick ratio of 1.87, a current ratio of 2.61 and a debt-to-equity ratio of 0.32.

Applied Materials Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, March 12th. Stockholders of record on Thursday, February 19th will be given a dividend of $0.46 per share. The ex-dividend date of this dividend is Thursday, February 19th. This represents a $1.84 annualized dividend and a dividend yield of 0.5%. Applied Materials’s dividend payout ratio (DPR) is 21.20%.

Insider Buying and Selling at Applied Materials

In other news, CAO Adam Sanders sold 609 shares of the company’s stock in a transaction dated Monday, December 1st. The shares were sold at an average price of $255.53, for a total transaction of $155,617.77. Following the transaction, the chief accounting officer owned 4,413 shares in the company, valued at approximately $1,127,653.89. This represents a 12.13% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, SVP Teri A. Little sold 4,000 shares of the firm’s stock in a transaction dated Tuesday, November 25th. The shares were sold at an average price of $238.24, for a total value of $952,960.00. Following the completion of the sale, the senior vice president owned 84,351 shares of the company’s stock, valued at approximately $20,095,782.24. This represents a 4.53% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last ninety days, insiders sold 8,609 shares of company stock valued at $2,044,898. Insiders own 0.30% of the company’s stock.

Institutional Trading of Applied Materials

Several hedge funds have recently bought and sold shares of the business. FORA Capital LLC raised its holdings in Applied Materials by 40.7% during the fourth quarter. FORA Capital LLC now owns 12,969 shares of the manufacturing equipment provider’s stock worth $3,333,000 after buying an additional 3,751 shares during the last quarter. Burton Enright Welch bought a new stake in shares of Applied Materials during the fourth quarter worth about $335,000. Kestra Advisory Services LLC raised its holdings in shares of Applied Materials by 20.6% in the 4th quarter. Kestra Advisory Services LLC now owns 108,779 shares of the manufacturing equipment provider’s stock worth $27,955,000 after acquiring an additional 18,609 shares during the last quarter. Transamerica Financial Advisors LLC raised its holdings in shares of Applied Materials by 61.4% in the 4th quarter. Transamerica Financial Advisors LLC now owns 489 shares of the manufacturing equipment provider’s stock worth $126,000 after acquiring an additional 186 shares during the last quarter. Finally, Maverick Capital Ltd. bought a new position in Applied Materials in the 4th quarter valued at about $290,727,000. Institutional investors and hedge funds own 80.56% of the company’s stock.

Wall Street Analyst Weigh In

AMAT has been the topic of a number of research reports. Wells Fargo & Company boosted their price objective on shares of Applied Materials from $350.00 to $435.00 and gave the stock an “overweight” rating in a research report on Friday. B. Riley Financial reaffirmed a “buy” rating on shares of Applied Materials in a report on Monday. KeyCorp raised their price objective on shares of Applied Materials from $380.00 to $450.00 and gave the stock an “overweight” rating in a research report on Friday. Summit Insights upgraded shares of Applied Materials from a “hold” rating to a “buy” rating in a research report on Friday. Finally, TD Cowen boosted their target price on shares of Applied Materials from $315.00 to $450.00 and gave the company a “buy” rating in a research report on Friday. Twenty-eight analysts have rated the stock with a Buy rating and six have assigned a Hold rating to the company’s stock. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average target price of $361.03.

Trending Headlines about Applied Materials

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

• Positive Sentiment: Q1 results beat consensus — EPS of $2.38 topped estimates and revenue of $7.01B beat expectations, evidence that services and AI-related demand are offsetting cyclical headwinds. This beat is the primary catalyst for the rally. Applied Materials Q1 Earnings Beat Estimates, Revenues Fall Y/Y
• Positive Sentiment: Strong guidance and AI-driven order cadence — management set Q2 EPS and revenue guidance above Street consensus and highlighted surging orders tied to AI processors and tightening memory demand, supporting a view of sustained equipment spending. Applied Materials jumps as AI demand drives chipmaking tool orders
• Positive Sentiment: Analyst upgrades and price-target increases — multiple firms raised ratings/targets (examples cited include Needham, Mizuho, Citigroup, B. Riley), which amplifies buying momentum and reduces near-term downside from sell-side skepticism.
• Neutral Sentiment: Regulatory settlement resolved — Applied reached a $252.5M civil settlement with the U.S. Department of Commerce over prior export issues; DOJ and SEC closed related probes without action. The payment is a one-time cost but it removes regulatory overhang going forward. Applied Materials Reaches Resolution with the U.S. Department of Commerce
• Negative Sentiment: Valuation concerns and bear case commentary — some analysts and op-eds argue the stock’s run has left limited upside and warn of pricey multiples; this creates the risk of profit-taking if future execution or guidance lags. Applied Materials: Little Opportunity Left After A Monstrous Run

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.