Applied Materials

The following is a summary of the Applied Materials, Inc. (AMAT) Q3 2024 Earnings Call Transcript: Financial Performance: Applied Materials reported record Q3 revenue of $6.78 billion, which was up 5% year-over-year. Non-GAAP gross margin improved to 47.4%, up 100 basis points year-over-year. Non-GAAP EPS of $2.12, up 12% year-over-year. Operating cash flow and free cash flow were nearly $2.4 billion and over $2 billion, respectively. Q4 revenue and non-GAAP EPS expectations also indicate continued growth. Business Progress: Strong execution in device architecture shifts for AI, including leading-edge logic, high-performance DRAM, high-bandwidth memory, and advanced packaging. Expansion in services, with Applied Global Services delivering record revenue and expecting continued low double-digit growth. Increased investments in new product developments for ICAPS and advanced packaging technologies, expecting these segments to drive significant future growth. Opportunities: AI and datacenter computing trends driving demand across semiconductor systems, especially in DRAM, high-bandwidth memory, and advanced […]

Applied Materials CFO Brice Hill says this quarter’s artificial-intelligence-fueled profit and revenue boosts are a harbinger for accelerated growth in its fiscal 2025. “We’re not giving a guide for ’25, but we think there’s a lot of energy around the AI markets,” he says. Unlike competitor Intel, Applied says it has no plans to cut back expenditures. Rather, the company’s continued growth will require increased investments related to research and development. That’s because AI ambitions are driving increased demand for chips, “as well as the need for significant advances in semiconductor innovation,” CEO Gary Dickerson says. Applied posts higher profit and revenue in its fiscal 3Q, while shares fall 2.7% in after-hours trading.

Applied Materials Inc (NASDAQ:AMAT) reported better-than-expected financial results for the second quarter on Thursday. “Applied Materials continues to deliver strong performance in 2024, with fiscal second quarter revenue and earnings towards the high end of our guided range,” said Gary Dickerson, president and CEO of Applied Materials. “Applied Materials has the most enabling portfolio of materials engineering technologies for chips that underpin tectonic shifts in technology including AI, IoT, electric vehicles and clean energy, which puts us in a great position to grow along with these long-term, secular trends.” The company said it sees third-quarter revenue of $6.65 billion, plus or minus $400 million, versus estimates of $6.576 billion. The company projects third-quarter adjusted earnings to be between $1.83 and $2.19 per share, versus estimates of $1.98 per share. Applied Materials shares fell 1.6% to close at $214.03 on Thursday. These analysts made changes to their price targets on Applied Materials

The following is a summary of the Applied Materials, Inc. (NASDAQ:AMAT) Q2 2024 Earnings Call Transcript: Financial Performance: Applied Materials reported Q2 net sales of nearly $6.65 billion, a slight increase from previous quarters. AGS revenue grew 7% year over year to $1.53 billion. The company returned approximately $1.1 billion to shareholders, including $266 million in dividends and $820 million in buybacks. Non-GAAP gross margin increased by 70 basis points to 47.5%, while non-GAAP EPS grew by 4.5% to $2.09. For Q3, Applied Materials forecasts a revenue of $6.65 billion, plus or minus $400 million, and non-GAAP EPS of $2.01, plus or minus $0.18. Business Progress: Revenues from the advanced packaging product portfolio is expected to grow to about $1.7 billion this year and possibly double in future. Applied Materials is targeting to generate more than $2.5 billion in revenue from gate-all-around nodes this year and expects this to potentially

We raise our price target by $7 to $240, 25x our CY 25 EPS view ($9.61), near peers and above AMAT’s 3-year average (~16x) on rising AI momentum and improving conditions across multiple end markets. We raise our FY 24 (Oct.) EPS view by $0.07 to $8.45, raise FY 25’s by $0.19 to $9.41, and initiate a FY 26 view at $10.58. AMAT posts Apr-Q sales of $6.65B (flat Y/Y) and EPS of $2.09 (+5%), near consensus, while raising its ’24 advanced packaging sales projection by $0.2B to $1.7B on stronger HBM packaging growth and providing a bullish forecast for GAA-related equipment sales (~$2.5B of incremental sales expected in CY 25) as customers ramp 2-nm node activity. We see tailwinds from rising AI demand fueling further growth across both logic and memory, and we are encouraged by positive commentary on ICAPS strength considering global weakness in the auto / industrial

Applied Materials (AMAT) faces the prospect of softer China demand and “strong offsetting tailwinds” in logic chips and advanced semiconductor packaging after fiscal Q2 results topped consensus, Morgan Stanley said Friday in a note. “At the risk of sounding like a broken record, we do believe the company that China will trend back toward the more traditional 30% of revenue from the current 43%,” the note said. “We remain on the cautious side of that; a region that is less than 5% of the global manufacturing footprint in foundry and memory driving over 40% of equipment sales and driving growth in trailing edge ICAP revenues higher during the worst analog inventory correction in 30 years, has unsustainable elements that make us cautious,” Morgan Stanley said. Still, “several trends are likely to prove strong offsetting tailwinds as the company has positioned themselves well in advanced logic and advanced packaging,” the note

Applied Materials posted slightly higher revenue in the fiscal second quarter and forecast another rise on the top line in the current period, a positive sign for a recently down semiconductor market. The Santa Clara, Calif.-based semiconductor equipment company reported a profit of $1.72 billion, or $2.06 a share, in the quarter that ended April 28, compared with a profit of $1.58 billion, or $1.86 a share, a year earlier. Analysts polled by FactSet expected a per-share profit of $2. Stripping out certain one-time items, the company posted an adjusted profit of $2.09 a share, greater than the $1.99 expected by analysts surveyed by FactSet. Revenue rose from a year earlier to $6.65 billion, beating the $6.54 billion expected by analysts polled by FactSet, which would have represented a slight drop from a year earlier. A year-on-year drop in revenue from its semiconductor systems segment was offset by higher revenue

Bernstein analyst Stacy Rasgon maintains Applied Materials (NASDAQ:AMAT) with a Outperform and raises the price target from $230 to $240.

Applied Materials (AMAT) sales are expected to rebound to double-digit growth from fiscal year 2025 as the company is well leveraged in artificial intelligence silicon technologies like high-bandwidth memory, advanced packaging, and leading-edge logic, BofA Securities said in a note Friday. The investment firm expects growth in dynamic random access memory, or DRAM, shipments to China to either slow down or stabilize in fiscal H2, putting pressure on Applied Materials’ gross margin as the year progresses. This will be offset by increased demand for high-bandwidth memory and double data rate, BofA added. The company is also likely to face challenges as ICAPS is expected to decline this year, according to the note. BofA said Applied Materials’ competitors, which have a greater focus on leading-edge logic, might perform better. The firm said leading-edge logic will recover in fiscal H2 due to growth in gate-all-around, backside power delivery, and advanced packaging. BofA

Cantor Fitzgerald analyst C J Muse reiterates Applied Materials (NASDAQ:AMAT) with a Neutral and maintains $220 price target.

Applied Materials, Inc. (Nasdaq: AMAT) Stock Analyst Ratings Date Upside/Downside Analyst Firm Price Target Change Rating Change Previous / Current Rating 02/20/2024 16.62% Goldman Sachs $156 → $220 Maintains Buy 02/16/2024 19.27% Mizuho $185 → $225 Maintains Buy 02/16/2024 -1.93% UBS $180 → $185 Maintains Neutral 02/16/2024 16.62% Goldman Sachs $156 → $220 Maintains Buy 02/16/2024 11.85% Citigroup $170 → $211 Maintains Buy 02/16/2024 32.52% B. Riley Securities $220 → $250 Reiterates Buy → Buy 02/16/2024 19.27% Raymond James $180 → $225 Maintains Outperform 02/16/2024 21.92% Stifel $175 → $230 Maintains Buy 02/16/2024 -15.19% Susquehanna $138 → $160 Maintains Neutral 02/16/2024 27.22% Needham $180 → $240 Maintains Buy 02/12/2024 0.72% Morgan Stanley $142 → $190 Maintains Equal-Weight 02/12/2024 -4.59% Cantor Fitzgerald → $180 Reiterates Neutral → Neutral 02/12/2024 16.62% B. Riley Securities $175 → $220 Maintains Buy 01/23/2024 -4.59% Cantor Fitzgerald → $180 Initiates Coverage On → Neutral 01/19/2024 -4.59%

Applied Materials, Inc. (Nasdaq: AMAT) Stock Analyst Ratings Date Upside/Downside Analyst Firm Price Target Change Rating Change Previous / Current Rating 02/16/2024 13.52% Needham $180 → $240 Maintains Buy 02/12/2024 -10.13% Morgan Stanley $142 → $190 Maintains Equal-Weight 02/12/2024 -14.86% Cantor Fitzgerald → $180 Reiterates Neutral → Neutral 02/12/2024 4.06% B. Riley Securities $175 → $220 Maintains Buy 01/23/2024 -14.86% Cantor Fitzgerald → $180 Initiates Coverage On → Neutral 01/19/2024 -14.86% Raymond James $160 → $180 Maintains Outperform 01/16/2024 -33.78% Barclays $120 → $140 Maintains Underweight 12/12/2023 -12.5% TD Cowen $165 → $185 Maintains Outperform 11/22/2023 -17.23% Redburn Atlantic → $175 Upgrades Neutral → Buy 11/17/2023 -21.01% Mizuho $162 → $167 Maintains Buy 11/17/2023 -19.59% JP Morgan $165 → $170 Maintains Overweight 11/17/2023 -32.84% Morgan Stanley $139 → $142 Maintains Equal-Weight 11/17/2023 -14.86% Needham → $180 Reiterates Buy → Buy 10/13/2023 -14.86% Needham → $180 Upgrades Hold → Buy 10/05/2023