Applied Materials Delivers the Best Quarter in Its 50-Year History
August 17 2017 - 4:01PM
Applied Materials, Inc. (NASDAQ:AMAT), which celebrates its
fiftieth corporate anniversary on November 10, today reported
record results in its third quarter ended July 30, 2017.
Compared to the same period last year, the company
grew net sales by 33 percent to $3.74 billion; increased gross
margin by 3.1 points to 45.4 percent; grew operating margin by 6.2
points to 27.3 percent; and increased earnings per share (EPS) by
85 percent to $0.85. On a non-GAAP adjusted basis, the company
increased gross margin by 2.9 points to 46.6 percent, grew
operating margin by 5.9 points to 28.7 percent, and increased EPS
by 72 percent to $0.86.
The company generated a record $1.37 billion in
cash from operations, which represented 36 percent of revenue, and
returned $482 million to shareholders through stock repurchases and
cash dividends.
“With revenue and profits at all-time highs,
Applied has tremendous momentum and a very positive outlook for the
future,” said Gary Dickerson, president and CEO. “Our markets are
growing with a broader set of demand drivers, and the breadth of
Applied’s technology enables us to play a larger and more valuable
role advancing the innovation roadmap in semiconductor and
display.”
Quarterly Results Summary
|
|
|
|
|
|
|
Q3 FY2017 |
|
Q3 FY2016 |
|
Change |
|
(In millions, except per share amounts and
percentages) |
Net sales |
$ |
3,744 |
|
|
$ |
2,821 |
|
|
33 |
% |
Gross margin |
45.4 |
% |
|
42.3 |
% |
|
3.1 |
points |
Operating margin |
27.3 |
% |
|
21.1 |
% |
|
6.2 |
points |
Net income |
$ |
925 |
|
|
$ |
505 |
|
|
83 |
% |
Diluted earnings per
share |
$ |
0.85 |
|
|
$ |
0.46 |
|
|
85 |
% |
Non-GAAP Adjusted Results |
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted gross
margin |
46.6 |
% |
|
43.7 |
% |
|
2.9 |
points |
Non-GAAP adjusted
operating margin |
28.7 |
% |
|
22.8 |
% |
|
5.9 |
points |
Non-GAAP adjusted net
income |
$ |
927 |
|
|
$ |
550 |
|
|
69 |
% |
Non-GAAP adjusted
diluted EPS |
$ |
0.86 |
|
|
$ |
0.50 |
|
|
72 |
% |
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of the GAAP and non-GAAP adjusted
results is provided in the financial tables included in this
release. See also “Use of Non-GAAP Adjusted Financial Measures”
section.
Business Outlook
In the fourth quarter of fiscal 2017, Applied
expects net sales to be in the range of $3.85 billion to $4.0
billion; the midpoint of the range would be an increase of
approximately 19 percent, year over year. Non-GAAP adjusted diluted
EPS is expected to be in the range of $0.86 to $0.94; the midpoint
of the range would be an increase of approximately 36 percent, year
over year.
This outlook for non-GAAP adjusted diluted EPS
excludes known charges related to completed acquisitions of $0.04
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
Semiconductor
Systems |
Q3 FY2017 |
|
Q3 FY2016 |
|
(In millions, except percentages) |
Net sales |
$ |
2,532 |
|
|
$ |
1,786 |
|
Foundry |
39 |
% |
|
37 |
% |
DRAM |
15 |
% |
|
11 |
% |
Flash |
38 |
% |
|
41 |
% |
Logic and
other |
8 |
% |
|
11 |
% |
Operating income |
874 |
|
|
511 |
|
Operating margin |
34.5 |
% |
|
28.6 |
% |
Non-GAAP
Adjusted Results |
|
|
|
|
|
|
|
Non-GAAP adjusted
operating income |
$ |
920 |
|
|
$ |
556 |
|
Non-GAAP adjusted
operating margin |
36.3 |
% |
|
31.1 |
% |
Applied Global
Services |
Q3 FY2017 |
|
Q3 FY2016 |
|
(In millions, except percentages) |
Net sales |
$ |
786 |
|
|
$ |
657 |
|
Operating income |
213 |
|
|
175 |
|
Operating margin |
27.1 |
% |
|
26.6 |
% |
Non-GAAP
Adjusted Results |
|
|
|
|
|
|
|
Non-GAAP adjusted
operating income |
$ |
215 |
|
|
$ |
176 |
|
Non-GAAP adjusted
operating margin |
27.4 |
% |
|
26.8 |
% |
Display and
Adjacent Markets |
Q3 FY2017 |
|
Q3 FY2016 |
|
(In millions, except percentages) |
Net sales |
$ |
410 |
|
|
$ |
313 |
|
Operating income |
91 |
|
|
63 |
|
Operating margin |
22.2 |
% |
|
20.1 |
% |
Non-GAAP
Adjusted Results |
|
|
|
|
|
|
|
Non-GAAP adjusted
operating income |
$ |
93 |
|
|
$ |
63 |
|
Non-GAAP adjusted
operating margin |
22.7 |
% |
|
20.1 |
% |
|
|
|
|
|
|
Use of Non-GAAP Adjusted Financial
Measures
Applied provides investors with certain non-GAAP
adjusted financial measures, which are adjusted to exclude the
impact of certain costs, expenses, gains and losses, including
certain items related to mergers and acquisitions; restructuring
charges and any associated adjustments; impairments of assets, or
investments; gain or loss on sale of strategic investments; income
tax items and certain other discrete adjustments. 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 adjusted 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 our 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 we do not believe are indicative of our
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 will be available at www.appliedmaterials.com. A
replay will be available on the website beginning at 5:00 p.m.
Pacific Time today.
Forward-Looking Statements
This press release contains forward-looking
statements, including those regarding anticipated growth and trends
in our businesses and markets, industry outlooks, technology
transitions, our business and financial performance and market
share positions, our capital allocation, our development of new
products and technologies, our business outlook for the fourth
quarter of fiscal 2017, 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 and industry conditions; consumer demand
for electronic products; the demand for semiconductors; 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; 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; 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; 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; and other risks and uncertainties
described in our SEC filings, including our most recent Forms 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 used to produce virtually every
new chip and advanced display in the world. Our expertise in
modifying materials at atomic levels and on an industrial scale
enables customers to transform possibilities into reality. At
Applied Materials, our innovations make possible the technology
shaping the future. Learn more at www.appliedmaterials.com.
Contact:
Ricky Gradwohl (editorial/media)
408.235.4676Michael Sullivan (financial community)
408.986.7977
APPLIED MATERIALS, INC. |
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF
OPERATIONS |
|
|
Three Months Ended |
|
Nine Months Ended |
(In millions, except
per share amounts) |
July 30, 2017 |
|
July 31, 2016 |
|
July 30, 2017 |
|
July 31, 2016 |
Net sales |
$ |
3,744 |
|
|
$ |
2,821 |
|
|
$ |
10,568 |
|
|
$ |
7,528 |
|
Cost of products
sold |
2,044 |
|
|
1,629 |
|
|
5,823 |
|
|
4,416 |
|
Gross profit |
1,700 |
|
|
1,192 |
|
|
4,745 |
|
|
3,112 |
|
Operating
expenses: |
|
|
|
|
|
|
|
Research,
development and engineering |
454 |
|
|
386 |
|
|
1,308 |
|
|
1,146 |
|
Marketing
and selling |
117 |
|
|
107 |
|
|
351 |
|
|
315 |
|
General
and administrative |
106 |
|
|
103 |
|
|
316 |
|
|
276 |
|
Total operating
expenses |
677 |
|
|
596 |
|
|
1,975 |
|
|
1,737 |
|
Income from
operations |
1,023 |
|
|
596 |
|
|
2,770 |
|
|
1,375 |
|
Interest expense |
59 |
|
|
38 |
|
|
141 |
|
|
117 |
|
Interest and other
income, net |
14 |
|
|
6 |
|
|
28 |
|
|
15 |
|
Income before income
taxes |
978 |
|
|
564 |
|
|
2,657 |
|
|
1,273 |
|
Provision for income
taxes |
53 |
|
|
59 |
|
|
205 |
|
|
162 |
|
Net income |
$ |
925 |
|
|
$ |
505 |
|
|
$ |
2,452 |
|
|
$ |
1,111 |
|
Earnings per
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.86 |
|
|
$ |
0.47 |
|
|
$ |
2.28 |
|
|
$ |
1.00 |
|
Diluted |
$ |
0.85 |
|
|
$ |
0.46 |
|
|
$ |
2.26 |
|
|
$ |
0.99 |
|
Weighted average number
of shares: |
|
|
|
|
|
|
|
Basic |
1,071 |
|
|
1,083 |
|
|
1,076 |
|
|
1,115 |
|
Diluted |
1,083 |
|
|
1,093 |
|
|
1,087 |
|
|
1,123 |
|
APPLIED MATERIALS, INC. |
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS |
|
(In millions) |
July 30, 2017 |
|
October 30, 2016 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and
cash equivalents |
$ |
5,278 |
|
|
$ |
3,406 |
|
Short-term investments |
1,953 |
|
|
343 |
|
Accounts
receivable, net |
2,258 |
|
|
2,279 |
|
Inventories |
2,876 |
|
|
2,050 |
|
Other
current assets |
366 |
|
|
275 |
|
Total current
assets |
12,731 |
|
|
8,353 |
|
Long-term
investments |
1,059 |
|
|
929 |
|
Property, plant and
equipment, net |
996 |
|
|
937 |
|
Goodwill |
3,357 |
|
|
3,316 |
|
Purchased technology
and other intangible assets, net |
461 |
|
|
575 |
|
Deferred income taxes
and other assets1 |
474 |
|
|
460 |
|
Total assets |
$ |
19,078 |
|
|
$ |
14,570 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts
payable, notes payable and accrued expenses |
2,255 |
|
|
2,256 |
|
Customer
deposits and deferred revenue |
2,116 |
|
|
1,376 |
|
Total current
liabilities |
4,371 |
|
|
3,632 |
|
Long-term debt1 |
5,303 |
|
|
3,125 |
|
Other liabilities |
688 |
|
|
596 |
|
Total liabilities |
10,362 |
|
|
7,353 |
|
Total stockholders’
equity |
8,716 |
|
|
7,217 |
|
Total liabilities and
stockholders’ equity |
$ |
19,078 |
|
|
$ |
14,570 |
|
|
1 Balances
reflect the effects of the retrospective adoption of the
authoritative guidance in the first quarter of fiscal 2017, which
required debt issuance costs to be presented as a direct reduction
from the carrying amount of the related debt liability. These
amounts were originally recorded under Other Assets. |
APPLIED MATERIALS, INC. |
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH
FLOWS |
|
(In
millions) |
Three Months Ended |
|
Nine Months Ended |
July 30, 2017 |
|
July 31, 2016 |
July 30, 2017 |
|
July 31, 2016 |
Cash flows from
operating activities: |
|
|
|
|
|
|
|
Net
income |
$ |
925 |
|
|
$ |
505 |
|
|
$ |
2,452 |
|
|
$ |
1,111 |
|
Adjustments required to reconcile net income to cash provided by
operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
102 |
|
|
97 |
|
|
302 |
|
|
289 |
|
Share-based compensation |
55 |
|
|
48 |
|
|
162 |
|
|
150 |
|
Excess
tax benefits from share-based compensation |
(3 |
) |
|
(5 |
) |
|
(51 |
) |
|
(18 |
) |
Deferred
income taxes |
(3 |
) |
|
21 |
|
|
6 |
|
|
14 |
|
Other |
6 |
|
|
5 |
|
|
15 |
|
|
20 |
|
Net
change in operating assets and liabilities |
284 |
|
|
310 |
|
|
24 |
|
|
103 |
|
Cash provided by
operating activities |
1,366 |
|
|
981 |
|
|
2,910 |
|
|
1,669 |
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
Capital
expenditures |
(80 |
) |
|
(50 |
) |
|
(221 |
) |
|
(165 |
) |
Cash paid
for acquisitions, net of cash acquired |
(30 |
) |
|
3 |
|
|
(56 |
) |
|
(5 |
) |
Proceeds
from sales and maturities of investments |
935 |
|
|
208 |
|
|
1,822 |
|
|
681 |
|
Purchases
of investments |
(1,174 |
) |
|
(483 |
) |
|
(3,542 |
) |
|
(947 |
) |
Cash used in investing
activities |
(349 |
) |
|
(322 |
) |
|
(1,997 |
) |
|
(436 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
Debt
borrowings, net of issuance costs |
— |
|
|
— |
|
|
2,176 |
|
|
— |
|
Debt
repayments |
(205 |
) |
|
(2 |
) |
|
(205 |
) |
|
(1,207 |
) |
Proceeds
from common stock issuances and others |
1 |
|
|
— |
|
|
47 |
|
|
44 |
|
Common
stock repurchases |
(375 |
) |
|
(196 |
) |
|
(787 |
) |
|
(1,721 |
) |
Excess
tax benefits from share-based compensation |
3 |
|
|
5 |
|
|
51 |
|
|
18 |
|
Payments
of dividends to stockholders |
(107 |
) |
|
(108 |
) |
|
(323 |
) |
|
(336 |
) |
Cash provided by (used
in) financing activities |
(683 |
) |
|
(301 |
) |
|
959 |
|
|
(3,202 |
) |
Increase (decrease) in
cash and cash equivalents |
334 |
|
|
358 |
|
|
1,872 |
|
|
(1,969 |
) |
Cash and cash
equivalents — beginning of period |
4,944 |
|
|
2,470 |
|
|
3,406 |
|
|
4,797 |
|
Cash and cash
equivalents — end of period |
$ |
5,278 |
|
|
$ |
2,828 |
|
|
$ |
5,278 |
|
|
$ |
2,828 |
|
Supplemental cash flow
information: |
|
|
|
|
|
|
|
Cash
payments for income taxes |
$ |
103 |
|
|
$ |
49 |
|
|
$ |
168 |
|
|
$ |
144 |
|
Cash
refunds from income taxes |
$ |
9 |
|
|
$ |
1 |
|
|
$ |
17 |
|
|
$ |
104 |
|
Cash
payments for interest |
$ |
35 |
|
|
$ |
34 |
|
|
$ |
110 |
|
|
$ |
110 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
APPLIED MATERIALS, INC. |
UNAUDITED SUPPLEMENTAL INFORMATION |
|
|
Corporate and Other |
|
(In millions) |
Q3 FY2017 |
|
Q3 FY2016 |
Unallocated net
sales |
$ |
16 |
|
|
$ |
65 |
|
Unallocated cost of
products sold and expenses |
(116 |
) |
|
(170 |
) |
Share-based
compensation |
(55 |
) |
|
(48 |
) |
Total |
$ |
(155 |
) |
|
$ |
(153 |
) |
|
Additional Information |
|
|
Q3 FY2017 |
|
Q3 FY2016 |
Net Sales by Geography
(In millions) |
|
|
|
|
|
|
|
United States |
|
359 |
|
|
|
289 |
|
% of
Total |
|
10 |
% |
|
|
10 |
% |
Europe |
|
191 |
|
|
|
124 |
|
% of
Total |
|
5 |
% |
|
|
5 |
% |
Japan |
|
444 |
|
|
|
321 |
|
% of
Total |
|
12 |
% |
|
|
11 |
% |
Korea |
|
1,265 |
|
|
|
472 |
|
% of
Total |
|
34 |
% |
|
|
17 |
% |
Taiwan |
|
607 |
|
|
|
741 |
|
% of
Total |
|
16 |
% |
|
|
26 |
% |
Southeast Asia |
|
104 |
|
|
|
303 |
|
% of
Total |
|
2 |
% |
|
|
11 |
% |
China |
|
774 |
|
|
|
571 |
|
% of
Total |
|
21 |
% |
|
|
20 |
% |
|
|
|
|
|
|
|
Employees (In
thousands) |
|
|
|
|
|
|
Regular Full Time |
|
17.6 |
|
|
|
15.2 |
|
APPLIED MATERIALS, INC. |
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED
RESULTS |
|
|
Three Months Ended |
|
Nine Months Ended |
(In millions, except
percentages) |
July 30, 2017 |
|
July 31, 2016 |
|
July 30, 2017 |
|
July 31, 2016 |
Non-GAAP Adjusted Gross
Profit |
|
|
|
|
|
|
|
Reported gross profit -
GAAP basis |
$ |
1,700 |
|
|
$ |
1,192 |
|
|
$ |
4,745 |
|
|
$ |
3,112 |
|
Certain items
associated with acquisitions1 |
44 |
|
|
42 |
|
|
127 |
|
|
125 |
|
Inventory reversals
related to restructuring2 |
— |
|
|
(1 |
) |
|
— |
|
|
(2 |
) |
Non-GAAP adjusted gross
profit |
$ |
1,744 |
|
|
$ |
1,233 |
|
|
$ |
4,872 |
|
|
$ |
3,235 |
|
Non-GAAP adjusted gross
margin |
46.6 |
% |
|
43.7 |
% |
|
46.1 |
% |
|
43.0 |
% |
Non-GAAP Adjusted
Operating Income |
|
|
|
|
|
|
|
Reported operating
income - GAAP basis |
$ |
1,023 |
|
|
$ |
596 |
|
|
$ |
2,770 |
|
|
$ |
1,375 |
|
Certain items
associated with acquisitions1 |
49 |
|
|
47 |
|
|
142 |
|
|
141 |
|
Acquisition integration
costs |
1 |
|
|
2 |
|
|
3 |
|
|
2 |
|
Reversals related to
restructuring, net2 |
— |
|
|
(1 |
) |
|
— |
|
|
(3 |
) |
Other gains, losses or
charges, net |
— |
|
|
— |
|
|
(3 |
) |
|
— |
|
Non-GAAP adjusted
operating income |
$ |
1,073 |
|
|
$ |
644 |
|
|
$ |
2,912 |
|
|
$ |
1,515 |
|
Non-GAAP adjusted
operating margin |
28.7 |
% |
|
22.8 |
% |
|
27.6 |
% |
|
20.1 |
% |
Non-GAAP Adjusted Net
Income |
|
|
|
|
|
|
|
Reported net income -
GAAP basis |
$ |
925 |
|
|
$ |
505 |
|
|
$ |
2,452 |
|
|
$ |
1,111 |
|
Certain items
associated with acquisitions1 |
49 |
|
|
47 |
|
|
142 |
|
|
141 |
|
Acquisition integration
costs |
1 |
|
|
2 |
|
|
3 |
|
|
2 |
|
Reversals related to
restructuring, net2 |
— |
|
|
(1 |
) |
|
— |
|
|
(3 |
) |
Impairment (gain on
sale) of strategic investments, net |
(1 |
) |
|
— |
|
|
4 |
|
|
(3 |
) |
Loss on early
extinguishment of debt |
5 |
|
|
— |
|
|
5 |
|
|
5 |
|
Other gains, losses or
charges, net |
— |
|
|
— |
|
|
(3 |
) |
|
— |
|
Reinstatement of
federal R&D tax credit, resolution of prior years’ income tax
filings and other tax items3 |
(46 |
) |
|
1 |
|
|
(68 |
) |
|
(12 |
) |
Income tax effect of
non-GAAP adjustments4 |
(6 |
) |
|
(4 |
) |
|
(15 |
) |
|
(13 |
) |
Non-GAAP adjusted net
income |
$ |
927 |
|
|
$ |
550 |
|
|
$ |
2,520 |
|
|
$ |
1,228 |
|
1 |
These
items are incremental charges attributable to completed
acquisitions, consisting of amortization of purchased intangible
assets. |
|
|
2 |
Results for the three and nine months ended July 31, 2016 included
favorable adjustments associated with the cost reductions in the
solar business. |
|
|
3 |
Results for the three and nine months ended July 30, 2017 included
the recognition of previously unrecognized foreign tax
credits. |
|
|
4 |
These
amounts represent non-GAAP adjustments above multiplied by the
effective tax rate within the jurisdictions that the adjustments
affect. |
APPLIED MATERIALS, INC. |
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED
RESULTS |
|
|
Three Months Ended |
|
Nine Months Ended |
(In millions, except
per share amounts) |
July 30, 2017 |
|
July 31, 2016 |
|
July 30, 2017 |
|
July 31, 2016 |
Non-GAAP Adjusted
Earnings Per Diluted Share |
|
|
|
|
|
|
|
Reported earnings per
diluted share - GAAP basis |
$ |
0.85 |
|
|
$ |
0.46 |
|
|
$ |
2.26 |
|
|
$ |
0.99 |
|
Certain items
associated with acquisitions |
0.04 |
|
|
0.04 |
|
|
0.12 |
|
|
0.11 |
|
Reinstatement of
federal R&D tax credit, resolution of prior years’ income tax
filings and other tax items |
(0.04 |
) |
|
— |
|
|
(0.06 |
) |
|
(0.01 |
) |
Other gains, losses or
charges, net |
0.01 |
|
|
— |
|
|
— |
|
|
— |
|
Non-GAAP adjusted
earnings per diluted share |
$ |
0.86 |
|
|
$ |
0.50 |
|
|
$ |
2.32 |
|
|
$ |
1.09 |
|
Weighted average number
of diluted shares |
1,083 |
|
|
1,093 |
|
|
1,087 |
|
|
1,123 |
|
APPLIED MATERIALS, INC. |
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED
RESULTS |
|
|
Three Months Ended |
|
Nine Months Ended |
(In millions, except
percentages) |
July 30, 2017 |
|
July 31, 2016 |
|
July 30, 2017 |
|
July 31, 2016 |
Semiconductor Systems
Non-GAAP Adjusted Operating Income |
|
|
|
|
|
|
|
Reported operating
income - GAAP basis |
$ |
874 |
|
|
$ |
511 |
|
|
$ |
2,372 |
|
|
$ |
1,140 |
|
Certain items
associated with acquisitions1 |
46 |
|
|
45 |
|
|
138 |
|
|
138 |
|
Non-GAAP adjusted
operating income |
$ |
920 |
|
|
$ |
556 |
|
|
$ |
2,510 |
|
|
$ |
1,278 |
|
Non-GAAP adjusted
operating margin |
36.3 |
% |
|
31.1 |
% |
|
35.4 |
% |
|
26.9 |
% |
AGS Non-GAAP Adjusted
Operating Income |
|
|
|
|
|
|
|
Reported operating
income - GAAP basis |
$ |
213 |
|
|
$ |
175 |
|
|
$ |
585 |
|
|
$ |
489 |
|
Certain items
associated with acquisitions1 |
1 |
|
|
1 |
|
|
1 |
|
|
1 |
|
Acquisition integration
costs |
1 |
|
|
— |
|
|
3 |
|
|
— |
|
Non-GAAP adjusted
operating income |
$ |
215 |
|
|
$ |
176 |
|
|
$ |
589 |
|
|
$ |
490 |
|
Non-GAAP adjusted
operating margin |
27.4 |
% |
|
26.8 |
% |
|
26.9 |
% |
|
25.8 |
% |
Display and Adjacent
Markets Non-GAAP Adjusted Operating Income |
|
|
|
|
|
|
|
Reported operating
income - GAAP basis |
$ |
91 |
|
|
$ |
63 |
|
|
$ |
290 |
|
|
$ |
142 |
|
Certain items
associated with acquisitions1 |
2 |
|
|
— |
|
|
2 |
|
|
— |
|
Non-GAAP adjusted
operating income |
$ |
93 |
|
|
$ |
63 |
|
|
$ |
292 |
|
|
$ |
142 |
|
Non-GAAP adjusted
operating margin |
22.7 |
% |
|
20.1 |
% |
|
23.9 |
% |
|
18.8 |
% |
1 |
These
items are incremental charges attributable to completed
acquisitions, consisting of amortization of purchased intangible
assets. |
|
|
Note: The
reconciliation of GAAP and non-GAAP adjusted segment results above
does not include certain revenues, costs of products sold and
operating expenses that are reported within corporate and other and
included in consolidated operating income. |
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