Applied Materials (AMAT)
Information Technology · $366B market cap · SEC CIK 0000006951
fundamentals score out of 100
Next reports on Nov 12, 2026, after the close, with analysts expecting $4.14 in earnings per share.
The case for AMAT
- Earns 40% back on shareholder equity.
- Generated $5.7B of free cash flow in FY2025, 20% of revenue.
- 30% of revenue drops through to net profit.
- Holds more cash ($7.2B) than long-term debt ($6.5B).
- Earnings per share up 38.4%.
- Has compounded revenue at 10.5% a year over five years.
The case against
- Pricey at 39.5× earnings, against a long-run market average nearer 20×.
- Swings harder than the market (beta 1.63).
- Priced at 11.9× sales with revenue growing only 7.8%.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Information Technology companies (momentum is judged against fixed thresholds only), and the five are blended by weight. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings, sales, assets and cash | 32 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 58 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 74 |
| Momentumhow the price has behaved lately | 52 |
| Stabilityhow violently it moves, what it owes and what it pays you | 40 |
- Each factor except momentum is half fixed thresholds, half rank among the 73 Information Technology companies.
Key numbers
| Price / earnings | 39.5× |
|---|---|
| Price / book | 16.01× |
| Price / sales | 11.9× |
| Revenue growth (YoY) | +7.8% |
| EPS growth (YoY) | +38.4% |
| Gross margin | 49% |
| Operating margin | 30% |
| Net margin | 30% |
| Return on equity | 40% |
| Debt / equity | 0.26× |
| Current ratio | 2.42 |
| Dividend yield | 0.85% |
| Beta | 1.63 |
| 52-week range | $188.66 – $739.67 |
| Position in that range | 52% of the way up |
| 3-month return | -24.8% |
| 1-year return | +144.2% |
Five years of financials, as filed
Pulled from Applied Materials's XBRL filings on SEC EDGAR. Italic rows are derived from the rows above.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue | $28.4B | $27.2B | $26.5B | $25.8B | $23.1B |
| Gross profit | $13.8B | $12.9B | $12.4B | $12.0B | $10.9B |
| Operating income | $8.3B | $7.9B | $7.7B | $7.8B | $6.9B |
| Net income | $7.0B | $7.2B | $6.9B | $6.5B | $5.9B |
| Operating cash flow | $8.0B | $8.7B | $8.7B | $5.4B | $5.4B |
| Capital expenditure | $2.3B | $1.2B | $1.1B | $787M | $668M |
| Total assets | $37.6B | $33.3B | $31.5B | $28.0B | $25.4B |
| Total liabilities | $15.9B | $14.7B | $14.1B | $14.5B | $13.5B |
| Shareholder equity | $21.7B | $18.6B | $17.4B | $13.4B | $11.9B |
| Cash | $7.2B | $6.3B | $6.9B | $3.5B | $5.3B |
| Long-term debt | $6.5B | $5.5B | $5.5B | $5.5B | $5.5B |
| Free cash flow | $5.7B | $7.5B | $7.6B | $4.6B | $4.8B |
| Gross margin | 48.7% | 47.5% | 46.7% | 46.5% | 47.3% |
| Operating margin | 29.2% | 28.9% | 28.9% | 30.2% | 29.9% |
| Net margin | 24.7% | 26.4% | 25.9% | 25.3% | 25.5% |
| Diluted shares | 808M | 834M | 845M | 877M | 919M |
Share count is down 12.1% over 4 years. Buybacks have been shrinking the pie.
What Applied Materials says it does
Applied Materials, Inc. is the leader in the materials engineering solutions used to produce virtually every semiconductor in the world. Semiconductors provide the foundation for advances in technology that are reshaping the global economy, including artificial intelligence, the internet of things, robotics, electric and autonomous vehicles, and clean energy. We are experts in the design, development, production, and servicing of the critical wafer fabrication tools our customers need to manufacture semiconductors. Our customers’ products are used across personal computing devices, mobile phones, artificial intelligence (AI) and data center servers, automobiles, connected devices, industrial applications and consumer electronics. We are well positioned to address the increasing complexity in manufacturing semiconductors, by leveraging the semiconductor capital equipment industry’s most comprehensive portfolio of products to connect and…
Risk factors AMAT lists in its 10-K
- The industries we serve can be volatile and difficult to predict
- We are exposed to risks associated with an uncertain global economy
- We are exposed to the risks of operating a global business
- We are exposed to risks and uncertainty related to changes in trade policies, and increased tariffs and trade disputes
- We are exposed to risks associated with a highly concentrated customer base
- We are exposed to various factors that impact the industries in which we operate, including factors specific to the semiconductor industry
- The industries in which we operate are highly competitive and subject to rapid technological and market changes
- We are exposed to risks related to government incentives and other agreements that may involve government entities
- We are exposed to factors specific to the display industry
- We are exposed to risks associated with expanding into new and related markets and industries
- We are exposed to risks related to the use of AI by us and our competitors
- We are exposed to risks related to protection and enforcement of intellectual property rights
- We are exposed to cybersecurity threats and incidents
- We are exposed to risks associated with business combinations, acquisitions, strategic investments and divestitures