Applied Materials (NASDAQ: AMAT) lifts Q3 revenue to $9.12B
Rhea-AI Filing Summary
Applied Materials, Inc. reported record third-quarter fiscal 2026 revenue of $9.12 billion, up 25% year over year. GAAP gross margin was 50.3% and non-GAAP gross margin 50.4%. GAAP operating income reached a record $3.08 billion (33.7% margin) and non-GAAP operating income was $3.10 billion (34.0% margin). GAAP EPS was $3.17 and record non-GAAP EPS was $3.50, up 43% and 41%, respectively.
The company generated record cash from operations of $3.04 billion and returned $860 million to shareholders via $440 million of share repurchases and $420 million in dividends. Semiconductor Systems revenue was $7.04 billion with a 55.3% gross margin and 37.7% operating margin; Applied Global Services revenue was $1.78 billion with a 35.6% gross margin.
For the fourth quarter of fiscal 2026, Applied Materials expects total revenue of about $10.25 billion +/- $0.50 billion and non-GAAP diluted EPS of $4.02 +/- $0.20. Management highlighted strong AI-driven demand, ongoing gross margin expansion and additional capacity investments to support projected demand through the end of the decade.
Positive
- Record Q3 FY2026 revenue of $9.12 billion, a 25% year-over-year increase, reflecting strong demand across Semiconductor Systems and services.
- Profitability strengthened with GAAP EPS rising to $3.17 and non-GAAP EPS to a record $3.50, up 43% and 41% year over year, alongside higher gross and operating margins.
- Robust cash generation with record cash from operations of $3.04 billion and $2.33 billion in non-GAAP free cash flow, enabling $860 million of capital returns to shareholders.
- Constructive outlook, with Q4 FY2026 guidance for revenue around $10.25 billion and non-GAAP diluted EPS of about $4.02, indicating expectations for continued growth.
Negative
- None.
Insights
Analyzing...
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q3 FY2026 Revenue: $9,115 million
Q3 GAAP Diluted EPS: $3.17
Q3 Non-GAAP Diluted EPS: $3.50
+5 more
8 metrics
Q3 FY2026 Revenue
$9,115 million
Record quarterly revenue, up 25% from $7,302 million in Q3 FY2025
Q3 GAAP Diluted EPS
$3.17
Earnings per diluted share for Q3 FY2026, up 43% year over year
Q3 Non-GAAP Diluted EPS
$3.50
Record non-GAAP EPS for Q3 FY2026, 41% higher than $2.48 in Q3 FY2025
Q3 Cash from Operations
$3,037 million
Record cash provided by operating activities in Q3 FY2026
Capital Returned to Shareholders
$860 million
Q3 FY2026 returns via $440 million share repurchases and $420 million dividends
Q4 FY2026 Revenue Guidance Midpoint
$10,250 million
Total revenue outlook for Q4 FY2026 of $10,250 million +/- $500 million
Q4 FY2026 Non-GAAP EPS Guidance Midpoint
$4.02
Non-GAAP diluted EPS outlook for Q4 FY2026 of $4.02 +/- $0.20
Semiconductor Systems Q3 Revenue
$7,040 million
Segment revenue in Q3 FY2026 with 55.3% GAAP gross margin and 37.7% operating margin
Key Terms
non-GAAP free cash flow, EPIC Center, hybrid bonding, valuation allowance, +2 more
6 terms
non-GAAP free cash flow financial
"Non-GAAP free cash flow | $ | 2,330 | | | | | $ | 2,050"
Non-GAAP free cash flow is a company’s reported cash generated from operations after paying for routine investments in property and equipment, adjusted by management to exclude or include certain items that aren’t part of standard accounting rules. Investors watch it as a practical measure of the cash a business has available for dividends, stock buybacks, debt repayment or reinvestment — like a household’s usable savings after adjusting for one-time or unusual expenses — but calculations vary between firms, so comparisons require caution.
EPIC Center technical
"Announced three additional EPIC Center partnerships. The EPIC Center is designed"
hybrid bonding technical
"variation control, which is particularly critical for hybrid bonding."
Hybrid bonding is a chip-assembly method that joins two silicon pieces face-to-face using very small metal and insulating connections, creating many tiny direct electrical links instead of relying on larger external wires. For investors, it matters because it lets device makers build smaller, faster and more energy-efficient processors and memory stacks, potentially improving product performance, reducing manufacturing costs, and creating competitive advantages along the semiconductor supply chain.
valuation allowance financial
"recognition of a $410 million valuation allowance against deferred tax assets"
A valuation allowance is a reserve set aside to reduce the value of certain assets on a company's financial records when there is uncertainty about whether they will generate the expected benefits. It acts like a caution sign, indicating that some assets might not be fully recoverable or worth their recorded amount. This matters to investors because it provides a more realistic picture of a company's financial health and potential risks.
intra-entity intangible asset transfers financial
"net income tax benefit related to intra-entity intangible asset transfers"
advanced packaging technical
"for advanced packaging, the Opta Quad continuously monitors wafer conditions"
Advanced packaging describes modern methods for arranging, connecting and enclosing semiconductor chips so they work together more efficiently in a smaller space—think of stacking and wiring tiny electronic building blocks instead of leaving them as separate items on a circuit board. It matters to investors because these techniques can boost product speed, reduce power use, shrink device size and lower manufacturing costs, all of which influence a maker’s competitiveness, profit margins and market share.
Earnings Snapshot
Revenue: $9,115 million · Guidance included
Q3 FY2026 (three months ended July 26, 2026)
Revenue
$9,115 million
25% year-over-year increase from $7,302 million
GAAP diluted EPS
$3.17
43% year-over-year increase from $2.22
Non-GAAP diluted EPS
$3.50
41% year-over-year increase from $2.48
GAAP operating margin
33.7%
Up from 30.6% in Q3 FY2025
Non-GAAP operating margin
34.0%
Up from 30.7% in Q3 FY2025
Cash from operations
$3,037 million
Up from $2,634 million in Q3 FY2025
Guidance
For Q4 FY2026, Applied Materials expects total revenue of $10,250 million +/- $500 million and non-GAAP diluted EPS of $4.02 +/- $0.20, excluding specified acquisition-related and certain tax items.
FAQ
How did Applied Materials (AMAT) perform financially in Q3 fiscal 2026?
Applied Materials delivered record Q3 FY2026 revenue of $9.12 billion, up 25% year over year. GAAP EPS was $3.17 and record non-GAAP EPS was $3.50, up 43% and 41% respectively, with GAAP gross margin at 50.3%.
What guidance did Applied Materials (AMAT) give for Q4 fiscal 2026?
For Q4 FY2026, Applied Materials expects total revenue of about $10.25 billion +/- $0.50 billion and non-GAAP diluted EPS of $4.02 +/- $0.20. This outlook excludes certain known acquisition-related charges and potential unknown non-operational items.
How did Applied Materials’ (AMAT) main segments perform in Q3 fiscal 2026?
Semiconductor Systems revenue was $7.04 billion with GAAP gross margin of 55.3% and operating margin of 37.7%. Applied Global Services revenue reached $1.78 billion with GAAP gross margin of 35.6% and operating margin of 30.1%.
What were the key non-GAAP metrics for Applied Materials (AMAT) in Q3 2026?
Key non-GAAP metrics included gross margin of 50.4%, operating margin of 34.0%, non-GAAP net income of $2.80 billion, and non-GAAP diluted EPS of $3.50. Non-GAAP free cash flow for the quarter was $2.33 billion.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________________________________
FORM 8-K
____________________________________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 13, 2026
____________________________________________________________________
Applied Materials, Inc.
(Exact name of registrant as specified in its charter)
____________________________________________________________________
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of principal executive offices)
Registrant’s telephone number, including area code: (408 ) 727-5555
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
| Emerging Growth Company | |||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act). ☐
Item 2.02 Results of Operations and Financial Condition.
On August 13, 2026, Applied Materials, Inc. (“Applied Materials”) announced its financial results for its third quarter ended July 26, 2026. A copy of Applied Materials’ press release is attached hereto as Exhibit 99.1.
The information in this Form 8-K, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section, and shall not be deemed to be incorporated by reference in any filing of Applied Materials under the Securities Act of 1933, as amended, or the Exchange Act, unless expressly incorporated by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |||||||
| 99.1 | Press Release issued by Applied Materials, Inc. dated August 13, 2026 | |||||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL) | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Applied Materials, Inc. (Registrant) | ||||||||||||||
| Date: | August 13, 2026 | By: | /s/ Teri A. Little | |||||||||||
| Teri A. Little | ||||||||||||||
| Senior Vice President, Chief Legal Officer and Corporate Secretary | ||||||||||||||
Exhibit 99.1
Investor Relations Contact:
Mike Sullivan (408) 986-7977
mike_sullivan@amat.com
Media Contact:
Ricky Gradwohl (408) 235-4676
ricky_gradwohl@amat.com
APPLIED MATERIALS ANNOUNCES THIRD QUARTER 2026 RESULTS
•Record revenue $9.12 billion, up 25 percent year over year
•GAAP gross margin 50.3 percent and non-GAAP gross margin 50.4 percent
•GAAP EPS $3.17 and record non-GAAP EPS $3.50, up 43 percent and 41 percent year over year, respectively
•EPIC Center R&D partnerships expand to 11 engagements with leading chipmakers, universities and innovation partners
SANTA CLARA, Calif., Aug. 13, 2026 — Applied Materials, Inc. (NASDAQ: AMAT) today reported results for its third quarter ended July 26, 2026.
Third Quarter Results
Applied generated record revenue of $9.12 billion. On a GAAP basis, the company reported gross margin of 50.3 percent, record operating income of $3.08 billion or 33.7 percent of revenue, and earnings per share (EPS) of $3.17.
On a non-GAAP basis, the company reported gross margin of 50.4 percent, record operating income of $3.10 billion or 34.0 percent of revenue, and record EPS of $3.50.
The company generated record cash from operations of $3.04 billion and distributed $860 million to shareholders through $440 million in share repurchases and $420 million in dividends.
“Applied Materials delivered another record-breaking quarter, including the highest sequential revenue growth in the company’s history,” said Gary Dickerson, President and CEO. “As the rapid global adoption of AI drives unprecedented demand for our materials engineering solutions, we are further raising our Semiconductor Systems revenue expectations for calendar 2026 and are confident we will grow faster than the market this year. Based on the increased demand visibility we are receiving from our customers, we expect another strong growth year for Applied Materials in 2027.”
“Applied Materials achieved its 13th consecutive quarter of year-over-year gross margin expansion, demonstrating the increasing value we create by enabling better chips, systems and fab returns,” said Brice Hill, Senior Vice President and CFO. “We expect continued strong revenue growth in the second half of the calendar year, particularly in DRAM as well as leading-edge foundry-logic and advanced packaging. Looking further ahead, we are making additional manufacturing capacity investments to support projected demand through the end of the decade.”
Applied Materials, Inc.
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Results Summary
| Q3 FY2026 | Q3 FY2025 | Change | |||||||||||||||
| (In millions, except per share amounts and percentages) | |||||||||||||||||
| Revenue | $ | 9,115 | $ | 7,302 | 25% | ||||||||||||
| Gross margin | 50.3 | % | 48.8 | % | 1.5 points | ||||||||||||
| Operating margin | 33.7 | % | 30.6 | % | 3.1 points | ||||||||||||
| Net income | $ | 2,538 | $ | 1,779 | 43% | ||||||||||||
| Diluted earnings per share | $ | 3.17 | $ | 2.22 | 43% | ||||||||||||
| Non-GAAP Results | |||||||||||||||||
| Non-GAAP gross margin | 50.4 | % | 48.9 | % | 1.5 points | ||||||||||||
| Non-GAAP operating margin | 34.0 | % | 30.7 | % | 3.3 points | ||||||||||||
| Non-GAAP net income | $ | 2,795 | $ | 1,989 | 41% | ||||||||||||
| Non-GAAP diluted EPS | $ | 3.50 | $ | 2.48 | 41% | ||||||||||||
| Non-GAAP free cash flow | $ | 2,330 | $ | 2,050 | 14% | ||||||||||||
A reconciliation of the GAAP and non-GAAP results is provided in the financial tables included in this release. See also “Use of Non-GAAP Financial Measures” section.
Recent Highlights
New Products and Technologies
•Introduced six new chipmaking systems for DRAM and advanced packaging.
•Enhanced Centura™ Prime™ Epi: selectively grows doped silicon germanium and silicon phosphorous in transistor source/drain regions, combining advanced strain engineering with precise doping control. The result is higher drive current and transistor efficiency, enabling faster, more power-efficient DRAM and high bandwidth memory (HBM).
•Opta™ Quad CMP: engineered specifically for advanced packaging, the Opta Quad continuously monitors wafer conditions during polish and dynamically adjusts in real time, improving within-wafer uniformity and total thickness variation control, which is particularly critical for hybrid bonding.
•Nokota™ VMax™ 2 ECD: high-precision copper plating across a broad range of applications for next-generation packaging, from TSV fill for 3D stacking to fine-pitch interconnects such as microbump formation. Nokota VMax 2 introduces Adaptive Pattern Tuning (APT), which dynamically shapes the electric field to correct for layout-driven variation and improve plating uniformity across the wafer.
•Producer™ Avila™ 2 PECVD: improves the mechanical stability of ultra-thin DRAM dies by depositing stress-balanced dielectric films around TSVs, enabling reliable stacking of 12, 16 and future high-layer-count HBM designs.
•VeritySEM™ 7AP Metrology: critical dimension eBeam metrology enables precise measurement of features on thick, heterogeneous and highly warped substrates common in HBM and chiplet architectures. VeritySEM AP systems automatically reconfigure to support a range of sizes and materials, while delivering sub-10nm sensitivity—orders of magnitude better than optical tools.
•SEMVision™ G7AP Defect Analysis: extends Applied’s leadership in eBeam defect analysis into advanced packaging, enabling high-resolution defect review and automated classification across silicon, organic and glass substrates. The system can accelerate yield learning by helping customers quickly distinguish critical defects from nuisance signals.
Applied Materials, Inc.
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•Introduced new deposition and etch systems that help chipmakers extend scaling in logic and memory to deliver higher performance, improved energy efficiency and better manufacturing yield for next-generation AI chips.
•Centris™ Spectral™ SiN ALD: leverages innovative microwave plasma technology to deliver uniform silicon nitride deposition in challenging 3D structures.
•Producer™ Selectra™ Mo Etch: selectively removes molybdenum for wordline separation to enable 3D NAND scaling.
•Unveiled SENZ™, an integrated ambient visual platform that combines waveguide optics, light engine, sensing, vision correction and electronic dimming technology in a single system designed for AI-powered next-generation display smart glasses.
Corporate Initiatives
•Announced three additional EPIC Center partnerships. The EPIC Center is designed to dramatically reduce the time it takes to commercialize breakthrough technologies from early-stage research to full-scale manufacturing.
•Broadcom Inc. will join EPIC as an innovation partner to accelerate development of advanced chip packaging technologies critical to next-generation AI systems.
•The University of California, Berkeley will join the EPIC Center as a research collaborator. Working side by side with Applied’s scientists and engineers, UC Berkeley faculty and students will pursue high-impact research programs to accelerate the material and process innovations that are foundational to AI computing.
•SCREEN Semiconductor Solutions Co., Ltd. (SCREEN SPE) will join the EPIC Center as an innovation partner, bringing together SCREEN SPE’s expertise in wafer cleaning technology with Applied's leadership in materials engineering to develop co-optimized process solutions for the world’s most advanced chips.
•Expanded our manufacturing and R&D operations in Singapore to support the global build-out of AI infrastructure. The new US$500 million Tampines Campus more than doubles Applied’s advanced cleanroom capacity in Singapore and strengthens the company’s global manufacturing footprint.
•Announced a long-term joint development agreement with EssilorLuxottica to accelerate the commercialization of next-generation intelligent optical systems for augmented reality and AI-powered smart eyewear.
•Published our latest Impact Report highlighting how Applied is progressing toward its sustainability goals and helping reduce the resources required to manufacture the semiconductors and technologies that support more energy-efficient computing in use.
Applied Materials, Inc.
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Business Outlook
Applied’s total revenue and non-GAAP diluted EPS for the fourth quarter of fiscal 2026 are expected to be as follows:
| Q4 FY2026 | |||||||||||||||||
| (In millions, except per share amounts) | |||||||||||||||||
| Total revenue | $ | 10,250 | +/- | $ | 500 | ||||||||||||
| Non-GAAP diluted EPS | $ | 4.02 | +/- | $ | 0.20 | ||||||||||||
This outlook for non-GAAP diluted EPS excludes known charges related to completed acquisitions of $0.01 per share, includes the normalized tax benefit of share-based compensation of $0.01 per share and includes a net income tax benefit related to intra-entity intangible asset transfers of $0.05 per share, but does not reflect any items that are unknown at this time, such as any additional charges related to acquisitions or other non-operational or unusual items, as well as other tax-related items, which we are not able to predict without unreasonable efforts due to their inherent uncertainty.
Third Quarter Reportable Segment Information
Effective in the first quarter of fiscal 2026, management moved our 200-millimeter equipment business to Semiconductor Systems. The business was previously included in Applied Global Services. Additionally, effective in the first quarter of fiscal 2026, management began fully allocating corporate support costs to our operating segments. Prior-period numbers have been recast to conform to the current-year presentation. Display operating segment financial results are included in the Other category balances below.
| Semiconductor Systems | Q3 FY2026 | Q3 FY2025 | |||||||||
| (in millions, except percentages) | |||||||||||
| Revenue | $ | 7,040 | $ | 5,564 | |||||||
| Foundry, logic and other | 67 | % | 69 | % | |||||||
| DRAM | 26 | % | 22 | % | |||||||
| Flash memory | 7 | % | 9 | % | |||||||
| Gross margin | 55.3 | % | 53.4 | % | |||||||
| Operating income | $ | 2,657 | $ | 1,837 | |||||||
| Operating margin | 37.7 | % | 33.0 | % | |||||||
| Non-GAAP Results | |||||||||||
| Non-GAAP gross margin | 55.4 | % | 53.5 | % | |||||||
| Non-GAAP operating income | $ | 2,673 | $ | 1,849 | |||||||
| Non-GAAP operating margin | 38.0 | % | 33.2 | % | |||||||
| Applied Global Services | Q3 FY2026 | Q3 FY2025 | |||||||||
| (in millions, except percentages) | |||||||||||
| Revenue | $ | 1,781 | $ | 1,463 | |||||||
| Gross margin | 35.6 | % | 33.8 | % | |||||||
| Operating income | $ | 536 | $ | 400 | |||||||
| Operating margin | 30.1 | % | 27.3 | % | |||||||
| Non-GAAP Results | |||||||||||
| Non-GAAP gross margin | 35.6 | % | 33.8 | % | |||||||
| Non-GAAP operating income | $ | 536 | $ | 400 | |||||||
| Non-GAAP operating margin | 30.1 | % | 27.3 | % | |||||||
| Other | Q3 FY2026 | Q3 FY2025 | |||||||||
| (in millions) | |||||||||||
| Revenue | $ | 294 | $ | 275 | |||||||
| Cost of products sold and expenses | (412) | (279) | |||||||||
| Operating income (loss) | $ | (118) | $ | (4) | |||||||
Applied Materials, Inc.
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Use of Non-GAAP Financial Measures
Applied provides investors with certain non-GAAP financial measures, which are adjusted for the impact of certain costs, expenses, gains and losses, including, as applicable, certain items related to mergers and acquisitions; restructuring and severance charges and any associated adjustments; legal settlement charges; impairments of assets; gain or loss, dividends and impairments on strategic investments; certain income tax items; and other discrete adjustments. On a non-GAAP basis, the tax effect related to share-based compensation is recognized ratably over the fiscal year. Reconciliations of these non-GAAP measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are provided in the financial tables included in this release.
Management uses these non-GAAP financial measures to evaluate the company’s operating and financial performance and for planning purposes, and as performance measures in its executive compensation program. Applied believes these measures enhance an overall understanding of its performance and investors’ ability to review the company’s business from the same perspective as the company’s management, and facilitate comparisons of this period’s results with prior periods on a consistent basis by excluding items that management does not believe are indicative of Applied's ongoing operating performance. There are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles, may be different from non-GAAP financial measures used by other companies, and may exclude certain items that may have a material impact upon our reported financial results. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP.
Webcast Information
Applied Materials will discuss these results during an earnings call that begins at 1:30 p.m. Pacific Time today. A live webcast and related slide presentation will be available at https://ir.appliedmaterials.com. A replay will be available on the website beginning at 5:00 p.m. Pacific Time today.
Applied Materials, Inc.
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Forward-Looking Statements
This press release contains forward-looking statements, including those regarding anticipated growth and trends in our businesses and markets, industry outlooks and demand drivers, technology transitions, our business and financial performance and market share positions, our capital allocation and cash deployment strategies, our investment and growth strategies, our development of new products and technologies, the plans and expectations for the EPIC Center, legal matters, our business outlook for the fourth quarter of fiscal 2026 and beyond, and other statements that are not historical facts. These statements and their underlying assumptions are subject to risks and uncertainties and are not guarantees of future performance. Factors that could cause actual results to differ materially from those expressed or implied by such statements include, without limitation: the level of demand for our products; global economic, political and industry conditions, including changes in interest rates and prices for goods and services; global trade issues, changes in trade and export regulations, license requirements, and their interpretation, and our ability to obtain licenses or authorizations on a timely basis, if at all; changes in tariffs, any retaliatory measures, and our ability to mitigate the impact of tariffs; the effects of geopolitical turmoil or conflicts; demand for semiconductor chips and electronic devices; customers’ technology and capacity requirements; the introduction of new and innovative technologies, and the timing of technology transitions; our ability to develop, deliver and support new products and technologies; our ability to meet customer demand, and our suppliers’ ability to meet our demand requirements; the concentrated nature of our customer base; our ability to expand our current markets, increase market share and develop new markets; market acceptance of existing and newly developed products; our ability to obtain and protect intellectual property rights in key technologies; cybersecurity incidents affecting us or our suppliers, customers or vendors; our ability to achieve the objectives of operational and strategic initiatives, align our resources and cost structure with business conditions, and attract, motivate and retain key employees; acquisitions, investments and divestitures; changes in income tax laws; the variability of operating expenses and results among products and segments, and our ability to accurately forecast future results, market conditions, customer requirements and business needs; our ability to ensure compliance with applicable law, rules and regulations; and other risks and uncertainties described in our filings with the Securities and Exchange Commission, including our most recent Forms 10-K, 10-Q and 8-K. All forward-looking statements are based on management’s current estimates, projections and assumptions, and we assume no obligation to update them.
About Applied Materials
Applied Materials, Inc. (Nasdaq: AMAT) is the leader in materials engineering solutions that are at the foundation of virtually every new semiconductor and advanced display in the world. The technology we create is essential to advancing AI and accelerating the commercialization of next-generation chips. At Applied, we push the boundaries of science and engineering to deliver material innovation that changes the world. Learn more at www.appliedmaterials.com.
Applied Materials, Inc.
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APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| (In millions, except per share amounts) | July 26, 2026 | July 27, 2025 | July 26, 2026 | July 27, 2025 | |||||||||||||||||||
| Revenue | $ | 9,115 | $ | 7,302 | $ | 24,037 | $ | 21,568 | |||||||||||||||
| Cost of products sold | 4,529 | 3,740 | 12,069 | 11,025 | |||||||||||||||||||
| Gross profit | 4,586 | 3,562 | 11,968 | 10,543 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research, development and engineering | 1,100 | 901 | 3,055 | 2,653 | |||||||||||||||||||
| Marketing and selling | 249 | 224 | 704 | 646 | |||||||||||||||||||
| General and administrative | 162 | 204 | 515 | 667 | |||||||||||||||||||
| Legal settlement | — | — | 253 | — | |||||||||||||||||||
| Restructuring charges | — | — | 12 | — | |||||||||||||||||||
| Total operating expenses | 1,511 | 1,329 | 4,539 | 3,966 | |||||||||||||||||||
| Income from operations | 3,075 | 2,233 | 7,429 | 6,577 | |||||||||||||||||||
| Interest expense | 68 | 66 | 206 | 198 | |||||||||||||||||||
| Interest and other income (expense), net | (100) | 396 | 1,237 | 625 | |||||||||||||||||||
| Income before income taxes | 2,907 | 2,563 | 8,460 | 7,004 | |||||||||||||||||||
| Provision for income taxes | 369 | 784 | 1,090 | 1,903 | |||||||||||||||||||
| Net income | $ | 2,538 | $ | 1,779 | $ | 7,370 | $ | 5,101 | |||||||||||||||
| Earnings per share: | |||||||||||||||||||||||
| Basic | $ | 3.20 | $ | 2.23 | $ | 9.29 | $ | 6.32 | |||||||||||||||
| Diluted | $ | 3.17 | $ | 2.22 | $ | 9.22 | $ | 6.29 | |||||||||||||||
| Weighted average number of shares: | |||||||||||||||||||||||
| Basic | 794 | 798 | 794 | 807 | |||||||||||||||||||
| Diluted | 800 | 802 | 799 | 811 | |||||||||||||||||||
Applied Materials, Inc.
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APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
| (In millions) | July 26, 2026 | October 26, 2025 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 7,037 | $ | 7,241 | |||||||
| Short-term investments | 2,196 | 1,332 | |||||||||
| Accounts receivable, net | 7,691 | 5,185 | |||||||||
| Inventories | 6,564 | 5,915 | |||||||||
| Other current assets | 1,607 | 1,208 | |||||||||
| Total current assets | 25,095 | 20,881 | |||||||||
| Long-term investments | 5,268 | 4,327 | |||||||||
| Property, plant and equipment, net | 5,606 | 4,610 | |||||||||
| Goodwill | 3,873 | 3,707 | |||||||||
| Purchased technology and other intangible assets, net | 315 | 226 | |||||||||
| Deferred income taxes and other assets | 3,365 | 2,548 | |||||||||
| Total assets | $ | 43,522 | $ | 36,299 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Short-term debt | $ | 1,299 | $ | 100 | |||||||
| Accounts payable and accrued expenses | 5,787 | 5,333 | |||||||||
| Contract liabilities | 3,271 | 2,566 | |||||||||
| Total current liabilities | 10,357 | 7,999 | |||||||||
| Long-term debt | 5,245 | 6,455 | |||||||||
| Income taxes payable | 880 | 356 | |||||||||
| Other liabilities | 1,414 | 1,074 | |||||||||
| Total liabilities | 17,896 | 15,884 | |||||||||
| Total stockholders’ equity | 25,626 | 20,415 | |||||||||
| Total liabilities and stockholders’ equity | $ | 43,522 | $ | 36,299 | |||||||
Applied Materials, Inc.
Page 9 of 14
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
| (In millions) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||
| July 26, 2026 | July 27, 2025 | July 26, 2026 | July 27, 2025 | ||||||||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||||||||
| Net income | $ | 2,538 | $ | 1,779 | $ | 7,370 | $ | 5,101 | |||||||||||||||
| Adjustments required to reconcile net income to cash provided by operating activities: | |||||||||||||||||||||||
| Depreciation and amortization | 151 | 113 | 413 | 321 | |||||||||||||||||||
| Restructuring charges | — | — | 12 | — | |||||||||||||||||||
| (Gain) / loss and impairment on investments | 229 | (294) | (909) | (270) | |||||||||||||||||||
| Share-based compensation | 169 | 158 | 545 | 512 | |||||||||||||||||||
| Deferred income taxes | (49) | 280 | 25 | 952 | |||||||||||||||||||
| Other | (15) | 10 | (11) | (28) | |||||||||||||||||||
| Net change in operating assets and liabilities | 14 | 588 | (1,877) | (1,458) | |||||||||||||||||||
| Cash provided by operating activities | 3,037 | 2,634 | 5,568 | 5,130 | |||||||||||||||||||
| Cash flows from investing activities: | |||||||||||||||||||||||
| Capital expenditures | (707) | (584) | (1,988) | (1,475) | |||||||||||||||||||
| Cash paid for acquisitions, net of cash acquired | (87) | — | (262) | (29) | |||||||||||||||||||
| Proceeds from asset sale | — | — | 6 | 33 | |||||||||||||||||||
| Proceeds from sales and maturities of investments | 1,351 | 793 | 4,585 | 3,937 | |||||||||||||||||||
| Purchases of investments | (1,970) | (2,176) | (5,493) | (5,109) | |||||||||||||||||||
| Cash provided by (used in) investing activities | (1,413) | (1,967) | (3,152) | (2,643) | |||||||||||||||||||
| Cash flows from financing activities: | |||||||||||||||||||||||
| Proceeds from issuance of commercial paper | 99 | 100 | 399 | 400 | |||||||||||||||||||
| Repayments of commercial paper | — | (100) | (400) | (400) | |||||||||||||||||||
| Proceeds from common stock issuances | — | — | 131 | 129 | |||||||||||||||||||
| Common stock repurchases | (440) | (1,056) | (1,177) | (4,044) | |||||||||||||||||||
| Tax withholding payments for vested equity awards | (128) | (33) | (437) | (210) | |||||||||||||||||||
| Payments of dividends to stockholders | (420) | (368) | (1,150) | (1,019) | |||||||||||||||||||
| Payments of debt issuance costs | — | — | — | (2) | |||||||||||||||||||
| Cash used in financing activities | (889) | (1,457) | (2,634) | (5,146) | |||||||||||||||||||
| Increase (decrease) in cash, cash equivalents and restricted cash equivalents | 735 | (790) | (218) | (2,659) | |||||||||||||||||||
| Cash, cash equivalents and restricted cash equivalents—beginning of period | 6,359 | 6,244 | 7,312 | 8,113 | |||||||||||||||||||
| Cash, cash equivalents and restricted cash equivalents — end of period | $ | 7,094 | $ | 5,454 | $ | 7,094 | $ | 5,454 | |||||||||||||||
| Reconciliation of cash, cash equivalents, and restricted cash equivalents | |||||||||||||||||||||||
| Cash and cash equivalents | $ | 7,037 | $ | 5,384 | $ | 7,037 | $ | 5,384 | |||||||||||||||
| Restricted cash equivalents included in deferred income taxes and other assets | 57 | 70 | 57 | 70 | |||||||||||||||||||
| Total cash, cash equivalents, and restricted cash equivalents | $ | 7,094 | $ | 5,454 | $ | 7,094 | $ | 5,454 | |||||||||||||||
| Supplemental cash flow information: | |||||||||||||||||||||||
| Cash payments for income taxes | $ | 169 | $ | 436 | $ | 819 | $ | 1,269 | |||||||||||||||
| Cash refunds from income taxes | $ | 6 | $ | 4 | $ | 22 | $ | 79 | |||||||||||||||
| Cash payments for interest | $ | 73 | $ | 51 | $ | 192 | $ | 171 | |||||||||||||||
Applied Materials, Inc.
Page 10 of 14
Additional Information
| Q3 FY2026 | Q3 FY2025 | ||||||||||
Revenue by Geography (In millions) | |||||||||||
| United States | $ | 1,367 | $ | 683 | |||||||
| % of Total | 15 | % | 9 | % | |||||||
| Europe | $ | 483 | $ | 160 | |||||||
| % of Total | 5 | % | 2 | % | |||||||
| Japan | $ | 839 | $ | 713 | |||||||
| % of Total | 9 | % | 10 | % | |||||||
| Korea | $ | 1,521 | $ | 1,160 | |||||||
| % of Total | 17 | % | 16 | % | |||||||
| Taiwan | $ | 2,025 | $ | 1,843 | |||||||
| % of Total | 22 | % | 25 | % | |||||||
| Southeast Asia | $ | 374 | $ | 195 | |||||||
| % of Total | 4 | % | 3 | % | |||||||
| China | $ | 2,506 | $ | 2,548 | |||||||
| % of Total | 28 | % | 35 | % | |||||||
Employees (In thousands) | |||||||||||
| Regular Full Time | 38.9 | 36.1 | |||||||||
Applied Materials, Inc.
Page 11 of 14
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP RESULTS
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| (In millions, except percentages) | July 26, 2026 | July 27, 2025 | July 26, 2026 | July 27, 2025 | |||||||||||||||||||
| Non-GAAP Gross Profit | |||||||||||||||||||||||
| GAAP reported gross profit | $ | 4,586 | $ | 3,562 | $ | 11,968 | $ | 10,543 | |||||||||||||||
Certain items associated with acquisitions1 | 11 | 7 | 24 | 20 | |||||||||||||||||||
| Non-GAAP gross profit | $ | 4,597 | $ | 3,569 | $ | 11,992 | $ | 10,563 | |||||||||||||||
| Non-GAAP gross margin | 50.4 | % | 48.9 | % | 49.9 | % | 49.0 | % | |||||||||||||||
| Non-GAAP Operating Income | |||||||||||||||||||||||
| GAAP reported operating income | $ | 3,075 | $ | 2,233 | $ | 7,429 | $ | 6,577 | |||||||||||||||
Certain items associated with acquisitions1 | 16 | 11 | 37 | 34 | |||||||||||||||||||
| Acquisition integration and deal costs | 5 | 1 | 8 | 4 | |||||||||||||||||||
Legal settlement2 | — | — | 253 | — | |||||||||||||||||||
Restructuring charges3 | — | — | 12 | — | |||||||||||||||||||
| Non-GAAP operating income | $ | 3,096 | $ | 2,245 | $ | 7,739 | $ | 6,615 | |||||||||||||||
| Non-GAAP operating margin | 34.0 | % | 30.7 | % | 32.2 | % | 30.7 | % | |||||||||||||||
| Non-GAAP Net Income | |||||||||||||||||||||||
| GAAP reported net income | $ | 2,538 | $ | 1,779 | $ | 7,370 | $ | 5,101 | |||||||||||||||
Certain items associated with acquisitions1 | 16 | 11 | 37 | 34 | |||||||||||||||||||
| Acquisition integration and deal costs | 5 | 1 | 8 | 4 | |||||||||||||||||||
Legal settlement2 | — | — | 253 | — | |||||||||||||||||||
Restructuring charges3 | — | — | 12 | — | |||||||||||||||||||
| Realized loss (gain), dividends and impairments on strategic investments, net | (7) | 16 | 22 | (11) | |||||||||||||||||||
| Unrealized loss (gain) on strategic investments, net | 220 | (314) | (949) | (288) | |||||||||||||||||||
| Foreign exchange loss (gain) related to purchase of strategic investment | — | — | — | 23 | |||||||||||||||||||
| Loss (gain) on asset sale | — | — | — | (44) | |||||||||||||||||||
Income tax effect of share-based compensation4 | 10 | 7 | (4) | 1 | |||||||||||||||||||
Income tax effects related to intra-entity intangible asset transfers5 | 33 | 32 | 96 | 738 | |||||||||||||||||||
Resolution of prior years’ income tax filings and other tax items6 | (46) | 460 | 3 | 320 | |||||||||||||||||||
Income tax effect of non-GAAP adjustments7 | 26 | (3) | 132 | (3) | |||||||||||||||||||
| Non-GAAP net income | $ | 2,795 | $ | 1,989 | $ | 6,980 | $ | 5,875 | |||||||||||||||
| 1 | These items are incremental charges attributable to completed acquisitions, consisting of amortization of purchased intangible assets. | ||||
| 2 | Charge of $253 million for settlement with the U.S. Commerce Department Bureau of Industry and Security to resolve a previously disclosed export controls compliance matter. | ||||
| 3 | The restructuring charges related to a workforce reduction plan announced in the fourth quarter of fiscal 2025. | ||||
| 4 | GAAP basis tax benefit related to share-based compensation is recognized ratably over the fiscal year on a non-GAAP basis. | ||||
| 5 | Amount for the nine months ended July 27, 2025, included changes to the income tax provision of $94 million from amortization of intangibles and a $644 million remeasurement of deferred tax assets resulting from new tax incentive agreements in Singapore in the first quarter of fiscal 2025. | ||||
| 6 | Amounts for the three and nine months ended July 27, 2025 included the impact of the recognition of a $410 million valuation allowance against deferred tax assets related to corporate alternative minimum tax credits. | ||||
| 7 | Adjustment to provision for income taxes related to non-GAAP adjustments reflected in income before income taxes. | ||||
Applied Materials, Inc.
Page 12 of 14
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP RESULTS
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| (In millions, except per share amounts) | July 26, 2026 | July 27, 2025 | July 26, 2026 | July 27, 2025 | |||||||||||||||||||
| Non-GAAP Earnings Per Diluted Share | |||||||||||||||||||||||
| GAAP reported earnings per diluted share | $ | 3.17 | $ | 2.22 | $ | 9.22 | $ | 6.29 | |||||||||||||||
| Certain items associated with acquisitions | 0.02 | 0.01 | 0.04 | 0.04 | |||||||||||||||||||
| Acquisition integration and deal costs | 0.01 | — | 0.01 | — | |||||||||||||||||||
| Legal settlement | — | — | 0.32 | — | |||||||||||||||||||
| Restructuring charges | — | — | 0.01 | — | |||||||||||||||||||
| Realized loss (gain), dividends and impairments on strategic investments, net | (0.01) | 0.02 | 0.02 | (0.02) | |||||||||||||||||||
| Unrealized loss (gain) on strategic investments, net | 0.31 | (0.39) | (1.01) | (0.36) | |||||||||||||||||||
| Foreign exchange loss (gain) related to purchase of strategic investment | — | — | — | 0.03 | |||||||||||||||||||
| Loss (gain) on asset sale | — | — | — | (0.04) | |||||||||||||||||||
| Income tax effect of share-based compensation | 0.02 | 0.01 | — | — | |||||||||||||||||||
Income tax effects related to intra-entity intangible asset transfers1 | 0.04 | 0.04 | 0.12 | 0.91 | |||||||||||||||||||
Resolution of prior years’ income tax filings and other tax items2 | (0.06) | 0.57 | — | 0.40 | |||||||||||||||||||
| Non-GAAP earnings per diluted share | $ | 3.50 | $ | 2.48 | $ | 8.73 | $ | 7.25 | |||||||||||||||
| Weighted average number of diluted shares | 800 | 802 | 799 | 811 | |||||||||||||||||||
| 1 | Amount for the nine months ended July 27, 2025, included changes to the income tax provision of $0.12 per diluted share from amortization of intangibles and $0.79 per diluted share from a remeasurement of deferred tax assets resulting from new tax incentive agreements in Singapore in the first quarter of fiscal 2025. | ||||
| 2 | Amounts for the three and nine months ended July 27, 2025 included a $0.51 per diluted share impact of the recognition of a valuation allowance against deferred tax assets related to corporate alternative minimum tax credits. | ||||
Applied Materials, Inc.
Page 13 of 14
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP RESULTS
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| (In millions, except percentages) | July 26, 2026 | July 27, 2025 | July 26, 2026 | July 27, 2025 | |||||||||||||||||||
| Semiconductor Systems Non-GAAP Gross Profit | |||||||||||||||||||||||
| GAAP reported gross profit | $ | 3,892 | $ | 2,970 | $ | 9,950 | $ | 8,845 | |||||||||||||||
Certain items associated with acquisitions1 | 11 | 7 | 24 | 20 | |||||||||||||||||||
| Non-GAAP gross profit | $ | 3,903 | $ | 2,977 | $ | 9,974 | $ | 8,865 | |||||||||||||||
| Non-GAAP gross margin | 55.4 | % | 53.5 | % | 55.0 | % | 53.5 | % | |||||||||||||||
| Applied Global Services Non-GAAP Gross Profit | |||||||||||||||||||||||
| GAAP reported gross profit | $ | 634 | $ | 494 | $ | 1,748 | $ | 1,407 | |||||||||||||||
| Non-GAAP gross profit | $ | 634 | $ | 494 | $ | 1,748 | $ | 1,407 | |||||||||||||||
| Non-GAAP gross margin | 35.6 | % | 33.8 | % | 34.9 | % | 33.2 | % | |||||||||||||||
| Semiconductor Systems Non-GAAP Operating Income | |||||||||||||||||||||||
| GAAP reported operating income | $ | 2,657 | $ | 1,837 | $ | 6,176 | $ | 5,479 | |||||||||||||||
Certain items associated with acquisitions1 | 16 | 11 | 37 | 34 | |||||||||||||||||||
| Acquisition integration and deal costs | — | 1 | — | 3 | |||||||||||||||||||
Legal settlement2 | — | — | 253 | — | |||||||||||||||||||
| Non-GAAP operating income | $ | 2,673 | $ | 1,849 | $ | 6,466 | $ | 5,516 | |||||||||||||||
| Non-GAAP operating margin | 38.0 | % | 33.2 | % | 35.6 | % | 33.3 | % | |||||||||||||||
| Applied Global Services Non-GAAP Operating Income | |||||||||||||||||||||||
| GAAP reported operating income | $ | 536 | $ | 400 | $ | 1,461 | $ | 1,114 | |||||||||||||||
| Acquisition integration and deal costs | — | — | — | 1 | |||||||||||||||||||
| Non-GAAP operating income | $ | 536 | $ | 400 | $ | 1,461 | $ | 1,115 | |||||||||||||||
| Non-GAAP operating margin | 30.1 | % | 27.3 | % | 29.2 | % | 26.3 | % | |||||||||||||||
| 1 | These items are incremental charges attributable to completed acquisitions, consisting of amortization of purchased intangible assets. | ||||
| 2 | Charge of $253 million for settlement with the U.S. Commerce Department Bureau of Industry and Security to resolve a previously disclosed export controls compliance matter. | ||||
Note: The reconciliation of GAAP and non-GAAP segment results above does not include certain revenues, costs of products sold and operating expenses that are reported within other and included in consolidated operating income.
Applied Materials, Inc.
Page 14 of 14
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP EFFECTIVE INCOME TAX RATE
| Three Months Ended | |||||
| (In millions, except percentages) | July 26, 2026 | ||||
GAAP provision for income taxes (a) | $ | 369 | |||
| Income tax effect of share-based compensation | (10) | ||||
| Income tax effects related to intra-entity intangible asset transfers | (33) | ||||
| Resolutions of prior years’ income tax filings and other tax items | 46 | ||||
| Income tax effect of non-GAAP adjustments | (26) | ||||
Non-GAAP provision for income taxes (b) | $ | 346 | |||
GAAP income before income taxes (c) | $ | 2,907 | |||
| Certain items associated with acquisitions | 16 | ||||
| Acquisition integration and deal costs | 5 | ||||
| Realized loss (gain), dividends and impairments on strategic investments, net | (7) | ||||
| Unrealized loss (gain) on strategic investments, net | 220 | ||||
Non-GAAP income before income taxes (d) | $ | 3,141 | |||
GAAP effective income tax rate (a/c) | 12.7 | % | |||
Non-GAAP effective income tax rate (b/d) | 11.0 | % | |||
UNAUDITED RECONCILIATION OF NON-GAAP FREE CASH FLOW
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| (In millions) | July 26, 2026 | July 27, 2025 | July 26, 2026 | July 27, 2025 | |||||||||||||||||||
| Cash provided by operating activities | $ | 3,037 | $ | 2,634 | $ | 5,568 | $ | 5,130 | |||||||||||||||
| Capital expenditures | (707) | (584) | (1,988) | (1,475) | |||||||||||||||||||
| Non-GAAP free cash flow | $ | 2,330 | $ | 2,050 | $ | 3,580 | $ | 3,655 | |||||||||||||||