AMAT Q2 goes past estimates to record high on AI-driven demand

Applied Materials, Inc.

Applied Materials, Inc.

AMAT

0.00


Overview

  • US semiconductor equipment maker's Q2 revenue rose 11%, beating analyst expectations

  • Adjusted EPS for Q2 beat analyst expectations, up 20% yr/yr

  • Company announced new EPIC Center partnerships and acquisition to accelerate chip innovation


Outlook

  • AMAT expects Q3 revenue of $8.95 bln +/- $500 mln

  • Company sees Q3 non-GAAP diluted EPS of $3.36 +/- $0.20

  • AMAT expects semiconductor equipment business to grow over 30% in calendar 2026


Result Drivers

  • AI INFRASTRUCTURE DEMAND - Co said rapid global build-out of AI computing infrastructure drove strong demand for semiconductor equipment

  • OPERATIONAL READINESS - Co increased build plan, inventory positions and logistics capacity to support customer growth and drive higher operating profit, per CFO Brice Hill

  • TECHNOLOGY PARTNERSHIPS - Co announced new EPIC Center partnerships and technology introductions to accelerate commercialization of next-generation semiconductor technologies


Company press release: ID:nGNX4q6KBJ


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q2 Sales

Beat

$7.91 bln

$7.65 bln (26 Analysts)

Q2 Adjusted EPS

Beat

$2.86

$2.66 (25 Analysts)

Q2 EPS

$3.51

Q2 Adjusted Net Income

Beat

$2.29 bln

$2.11 bln (23 Analysts)

Q2 Net Income

$2.81 bln

Q2 Adjusted Free Cash Flow

$210 mln

Q2 Adjusted Gross Margin

50.00%

Q2 Adjusted Operating Margin

32.10%


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 33 "strong buy" or "buy", 6 "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the semiconductor equipment & testing peer group is "buy"

  • Wall Street's median 12-month price target for Applied Materials Inc is $450.00, about 3.1% above its May 13 closing price of $436.61

  • The stock recently traded at 34 times the next 12-month earnings vs. a P/E of 32 three months ago


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