Delaware | 000-06920 | 94-1655526 | ||||||||||||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
☐ | 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)) |
Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||
Common Stock, par value $.01 per share | AMAT | The NASDAQ Stock Market LLC |
Emerging Growth Company | ☐ |
Exhibit No. | Description | |||||||
99.1 | ||||||||
104 | Cover Page Interactive Data File (formatted as inline XBRL) |
Applied Materials, Inc. (Registrant) |
||||||||||||||
Date: | August 15, 2024 | By: | /s/ Teri A. Little | |||||||||||
Teri A. Little | ||||||||||||||
Senior Vice President, Chief Legal Officer and Corporate Secretary |
Q3 FY2024 | Q3 FY2023 | Change | |||||||||||||||
(In millions, except per share amounts and percentages) | |||||||||||||||||
Net revenue | $ | 6,778 | $ | 6,425 | 5% | ||||||||||||
Gross margin | 47.3 | % | 46.3 | % | 1.0 point | ||||||||||||
Operating margin | 28.7 | % | 28.0 | % | 0.7 points | ||||||||||||
Net income | $ | 1,705 | $ | 1,560 | 9% | ||||||||||||
Diluted earnings per share | $ | 2.05 | $ | 1.85 | 11% | ||||||||||||
Non-GAAP Results | |||||||||||||||||
Non-GAAP gross margin | 47.4 | % | 46.4 | % | 1.0 point | ||||||||||||
Non-GAAP operating margin | 28.8 | % | 28.3 | % | 0.5 points | ||||||||||||
Non-GAAP net income | $ | 1,767 | $ | 1,600 | 10% | ||||||||||||
Non-GAAP diluted EPS | $ | 2.12 | $ | 1.90 | 12% | ||||||||||||
Non-GAAP free cash flow | $ | 2,088 | $ | 2,328 | (10)% |
Semiconductor Systems | Q3 FY2024 | Q3 FY2023 | |||||||||
(In millions, except percentages) | |||||||||||
Net revenue | $ | 4,924 | $ | 4,676 | |||||||
Foundry, logic and other | 72 | % | 79 | % | |||||||
DRAM | 24 | % | 17 | % | |||||||
Flash memory | 4 | % | 4 | % | |||||||
Operating income | $ | 1,712 | $ | 1,568 | |||||||
Operating margin | 34.8 | % | 33.5 | % | |||||||
Non-GAAP Results | |||||||||||
Non-GAAP operating income | $ | 1,722 | $ | 1,578 | |||||||
Non-GAAP operating margin | 35.0 | % | 33.7 | % |
Applied Global Services | Q3 FY2024 | Q3 FY2023 | |||||||||
(In millions, except percentages) | |||||||||||
Net revenue | $ | 1,580 | $ | 1,464 | |||||||
Operating income | $ | 467 | $ | 399 | |||||||
Operating margin | 29.6 | % | 27.3 | % | |||||||
Non-GAAP Results | |||||||||||
Non-GAAP operating income | $ | 467 | $ | 399 | |||||||
Non-GAAP operating margin | 29.6 | % | 27.3 | % |
Display and Adjacent Markets | Q3 FY2024 | Q3 FY2023 | |||||||||
(In millions, except percentages) | |||||||||||
Net revenue | $ | 251 | $ | 235 | |||||||
Operating income | $ | 16 | $ | 32 | |||||||
Operating margin | 6.4 | % | 13.6 | % | |||||||
Non-GAAP Results | |||||||||||
Non-GAAP operating income | $ | 16 | $ | 32 | |||||||
Non-GAAP operating margin | 6.4 | % | 13.6 | % |
(In millions) | Q3 FY2024 | Q3 FY2023 | |||||||||
Unallocated net revenue | $ | 23 | $ | 50 | |||||||
Unallocated cost of products sold and expenses | (276) | (247) | |||||||||
Total | $ | (253) | $ | (197) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In millions, except per share amounts) | July 28, 2024 |
July 30, 2023 |
July 28, 2024 |
July 30, 2023 |
|||||||||||||||||||
Net revenue | $ | 6,778 | $ | 6,425 | $ | 20,131 | $ | 19,794 | |||||||||||||||
Cost of products sold | 3,573 | 3,449 | 10,569 | 10,579 | |||||||||||||||||||
Gross profit | 3,205 | 2,976 | 9,562 | 9,215 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research, development and engineering | 836 | 767 | 2,375 | 2,313 | |||||||||||||||||||
Marketing and selling | 205 | 193 | 621 | 584 | |||||||||||||||||||
General and administrative | 222 | 214 | 745 | 635 | |||||||||||||||||||
Total operating expenses | 1,263 | 1,174 | 3,741 | 3,532 | |||||||||||||||||||
Income from operations | 1,942 | 1,802 | 5,821 | 5,683 | |||||||||||||||||||
Interest expense | 63 | 60 | 181 | 180 | |||||||||||||||||||
Interest and other income (expense), net | 81 | 64 | 617 | 41 | |||||||||||||||||||
Income before income taxes | 1,960 | 1,806 | 6,257 | 5,544 | |||||||||||||||||||
Provision for income taxes | 255 | 246 | 811 | 692 | |||||||||||||||||||
Net income | $ | 1,705 | $ | 1,560 | $ | 5,446 | $ | 4,852 | |||||||||||||||
Earnings per share: | |||||||||||||||||||||||
Basic | $ | 2.06 | $ | 1.86 | $ | 6.57 | $ | 5.76 | |||||||||||||||
Diluted | $ | 2.05 | $ | 1.85 | $ | 6.52 | $ | 5.73 | |||||||||||||||
Weighted average number of shares: | |||||||||||||||||||||||
Basic | 826 | 838 | 829 | 842 | |||||||||||||||||||
Diluted | 833 | 843 | 835 | 846 |
(In millions) | July 28, 2024 |
October 29, 2023 |
|||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 8,288 | $ | 6,132 | |||||||
Short-term investments | 815 | 737 | |||||||||
Accounts receivable, net | 4,970 | 5,165 | |||||||||
Inventories | 5,568 | 5,725 | |||||||||
Other current assets | 1,030 | 1,388 | |||||||||
Total current assets | 20,671 | 19,147 | |||||||||
Long-term investments | 2,981 | 2,281 | |||||||||
Property, plant and equipment, net | 3,100 | 2,723 | |||||||||
Goodwill | 3,732 | 3,732 | |||||||||
Purchased technology and other intangible assets, net | 262 | 294 | |||||||||
Deferred income taxes and other assets | 2,901 | 2,552 | |||||||||
Total assets | $ | 33,647 | $ | 30,729 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Short-term debt | $ | 99 | $ | 100 | |||||||
Accounts payable and accrued expenses | 4,387 | 4,297 | |||||||||
Contract liabilities | 2,742 | 2,975 | |||||||||
Total current liabilities | 7,228 | 7,372 | |||||||||
Long-term debt | 6,158 | 5,461 | |||||||||
Income taxes payable | 671 | 833 | |||||||||
Other liabilities | 750 | 714 | |||||||||
Total liabilities | 14,807 | 14,380 | |||||||||
Total stockholders’ equity | 18,840 | 16,349 | |||||||||
Total liabilities and stockholders’ equity | $ | 33,647 | $ | 30,729 |
(In millions) | Three Months Ended | Nine Months Ended | |||||||||||||||||||||
July 28, 2024 |
July 30, 2023 |
July 28, 2024 |
July 30, 2023 |
||||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||||
Net income | $ | 1,705 | $ | 1,560 | $ | 5,446 | $ | 4,852 | |||||||||||||||
Adjustments required to reconcile net income to cash provided by operating activities: | |||||||||||||||||||||||
Depreciation and amortization | 95 | 136 | 282 | 385 | |||||||||||||||||||
Share-based compensation | 132 | 114 | 436 | 375 | |||||||||||||||||||
Deferred income taxes | (179) | (38) | (385) | (174) | |||||||||||||||||||
Other | 48 | 15 | (199) | 189 | |||||||||||||||||||
Net change in operating assets and liabilities | 584 | 796 | 522 | 1,518 | |||||||||||||||||||
Cash provided by operating activities | 2,385 | 2,583 | 6,102 | 7,145 | |||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||
Capital expenditures | (297) | (255) | (783) | (797) | |||||||||||||||||||
Cash paid for acquisitions, net of cash acquired | — | (7) | — | (25) | |||||||||||||||||||
Proceeds from sales and maturities of investments | 382 | 302 | 1,495 | 971 | |||||||||||||||||||
Purchases of investments | (745) | (465) | (1,968) | (1,195) | |||||||||||||||||||
Cash used in investing activities | (660) | (425) | (1,256) | (1,046) | |||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||
Debt borrowings, net of issuance costs | 694 | — | 694 | — | |||||||||||||||||||
Proceeds from issuance of commercial paper | 100 | 297 | 300 | 892 | |||||||||||||||||||
Repayments of commercial paper | (100) | (300) | (300) | (700) | |||||||||||||||||||
Proceeds from common stock issuances | — | — | 119 | 111 | |||||||||||||||||||
Common stock repurchases | (861) | (439) | (2,381) | (1,489) | |||||||||||||||||||
Tax withholding payments for vested equity awards | (25) | (11) | (258) | (165) | |||||||||||||||||||
Payments of dividends to stockholders | (331) | (268) | (863) | (707) | |||||||||||||||||||
Repayments of principal on finance leases | 1 | 1 | (12) | (8) | |||||||||||||||||||
Cash used in financing activities | (522) | (720) | (2,701) | (2,066) | |||||||||||||||||||
Increase (decrease) in cash, cash equivalents and restricted cash equivalents | 1,203 | 1,438 | 2,145 | 4,033 | |||||||||||||||||||
Cash, cash equivalents and restricted cash equivalents—beginning of period | 7,175 | 4,695 | 6,233 | 2,100 | |||||||||||||||||||
Cash, cash equivalents and restricted cash equivalents — end of period | $ | 8,378 | $ | 6,133 | $ | 8,378 | $ | 6,133 | |||||||||||||||
Reconciliation of cash, cash equivalents, and restricted cash equivalents | |||||||||||||||||||||||
Cash and cash equivalents | $ | 8,288 | $ | 6,025 | $ | 8,288 | $ | 6,025 | |||||||||||||||
Restricted cash equivalents included in deferred income taxes and other assets | 90 | 108 | 90 | 108 | |||||||||||||||||||
Total cash, cash equivalents, and restricted cash equivalents | $ | 8,378 | $ | 6,133 | $ | 8,378 | $ | 6,133 | |||||||||||||||
Supplemental cash flow information: | |||||||||||||||||||||||
Cash payments for income taxes | $ | 213 | $ | 197 | $ | 819 | $ | 418 | |||||||||||||||
Cash refunds from income taxes | $ | 2 | $ | — | $ | 7 | $ | 51 | |||||||||||||||
Cash payments for interest | $ | 35 | $ | 35 | $ | 137 | $ | 137 |
Q3 FY2024 | Q3 FY2023 | ||||||||||
Net Revenue by Geography (In millions) |
|||||||||||
United States | $ | 1,053 | $ | 1,039 | |||||||
% of Total | 16 | % | 16 | % | |||||||
Europe | $ | 339 | $ | 661 | |||||||
% of Total | 5 | % | 10 | % | |||||||
Japan | $ | 555 | $ | 478 | |||||||
% of Total | 8 | % | 8 | % | |||||||
Korea | $ | 1,102 | $ | 988 | |||||||
% of Total | 16 | % | 15 | % | |||||||
Taiwan | $ | 1,148 | $ | 1,345 | |||||||
% of Total | 17 | % | 21 | % | |||||||
Southeast Asia | $ | 428 | $ | 180 | |||||||
% of Total | 6 | % | 3 | % | |||||||
China | $ | 2,153 | $ | 1,734 | |||||||
% of Total | 32 | % | 27 | % | |||||||
Employees (In thousands) |
|||||||||||
Regular Full Time | 35.2 | 34.5 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In millions, except percentages) | July 28, 2024 |
July 30, 2023 |
July 28, 2024 |
July 30, 2023 |
|||||||||||||||||||
Non-GAAP Gross Profit | |||||||||||||||||||||||
GAAP reported gross profit | $ | 3,205 | $ | 2,976 | $ | 9,562 | $ | 9,215 | |||||||||||||||
Certain items associated with acquisitions1 |
6 | 7 | 20 | 21 | |||||||||||||||||||
Non-GAAP gross profit | $ | 3,211 | $ | 2,983 | $ | 9,582 | $ | 9,236 | |||||||||||||||
Non-GAAP gross margin | 47.4 | % | 46.4 | % | 47.6 | % | 46.7 | % | |||||||||||||||
Non-GAAP Operating Income | |||||||||||||||||||||||
GAAP reported operating income | $ | 1,942 | $ | 1,802 | $ | 5,821 | $ | 5,683 | |||||||||||||||
Certain items associated with acquisitions1 |
10 | 10 | 31 | 32 | |||||||||||||||||||
Acquisition integration and deal costs | 1 | 6 | 9 | 20 | |||||||||||||||||||
Non-GAAP operating income | $ | 1,953 | $ | 1,818 | $ | 5,861 | $ | 5,735 | |||||||||||||||
Non-GAAP operating margin | 28.8 | % | 28.3 | % | 29.1 | % | 29.0 | % | |||||||||||||||
Non-GAAP Net Income | |||||||||||||||||||||||
GAAP reported net income | $ | 1,705 | $ | 1,560 | $ | 5,446 | $ | 4,852 | |||||||||||||||
Certain items associated with acquisitions1 |
10 | 10 | 31 | 32 | |||||||||||||||||||
Acquisition integration and deal costs | 1 | 6 | 9 | 20 | |||||||||||||||||||
Realized loss (gain), dividends and impairments on strategic investments, net | 16 | (4) | 12 | 109 | |||||||||||||||||||
Unrealized loss (gain) on strategic investments, net | 25 | 6 | (275) | 13 | |||||||||||||||||||
Income tax effect of share-based compensation2 |
8 | 5 | (7) | (6) | |||||||||||||||||||
Income tax effects related to intra-entity intangible asset transfers | 17 | 9 | 57 | 25 | |||||||||||||||||||
Resolution of prior years’ income tax filings and other tax items | (11) | 10 | 22 | (22) | |||||||||||||||||||
Income tax effect of non-GAAP adjustments3 |
(4) | (2) | (2) | (7) | |||||||||||||||||||
Non-GAAP net income | $ | 1,767 | $ | 1,600 | $ | 5,293 | $ | 5,016 |
1 | These items are incremental charges attributable to completed acquisitions, consisting of amortization of purchased intangible assets. | ||||
2 | GAAP basis tax benefit related to share-based compensation is recognized ratably over the fiscal year on a non-GAAP basis. | ||||
3 | Adjustment to provision for income taxes related to non-GAAP adjustments reflected in income before income taxes. | ||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In millions, except per share amounts) | July 28, 2024 |
July 30, 2023 |
July 28, 2024 |
July 30, 2023 |
|||||||||||||||||||
Non-GAAP Earnings Per Diluted Share | |||||||||||||||||||||||
GAAP reported earnings per diluted share | $ | 2.05 | $ | 1.85 | $ | 6.52 | $ | 5.73 | |||||||||||||||
Certain items associated with acquisitions | 0.01 | 0.01 | 0.04 | 0.04 | |||||||||||||||||||
Acquisition integration and deal costs | — | 0.01 | 0.01 | 0.02 | |||||||||||||||||||
Realized loss (gain), dividends and impairments on strategic investments, net | 0.01 | — | 0.01 | 0.13 | |||||||||||||||||||
Unrealized loss (gain) on strategic investments, net | 0.03 | — | (0.33) | 0.01 | |||||||||||||||||||
Income tax effect of share-based compensation | 0.01 | 0.01 | (0.01) | (0.01) | |||||||||||||||||||
Income tax effects related to intra-entity intangible asset transfers | 0.02 | 0.01 | 0.07 | 0.03 | |||||||||||||||||||
Resolution of prior years’ income tax filings and other tax items | (0.01) | 0.01 | 0.03 | (0.02) | |||||||||||||||||||
Non-GAAP earnings per diluted share | $ | 2.12 | $ | 1.90 | $ | 6.34 | $ | 5.93 | |||||||||||||||
Weighted average number of diluted shares | 833 | 843 | 835 | 846 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In millions, except percentages) | July 28, 2024 |
July 30, 2023 |
July 28, 2024 |
July 30, 2023 |
|||||||||||||||||||
Semiconductor Systems Non-GAAP Operating Income | |||||||||||||||||||||||
GAAP reported operating income | $ | 1,712 | $ | 1,568 | $ | 5,157 | $ | 5,138 | |||||||||||||||
Certain items associated with acquisitions1 |
10 | 10 | 30 | 29 | |||||||||||||||||||
Non-GAAP operating income | $ | 1,722 | $ | 1,578 | $ | 5,187 | $ | 5,167 | |||||||||||||||
Non-GAAP operating margin | 35.0 | % | 33.7 | % | 35.2 | % | 34.9 | % | |||||||||||||||
Applied Global Services Non-GAAP Operating Income | |||||||||||||||||||||||
GAAP reported operating income | $ | 467 | $ | 399 | $ | 1,320 | $ | 1,128 | |||||||||||||||
Non-GAAP operating income | $ | 467 | $ | 399 | $ | 1,320 | $ | 1,128 | |||||||||||||||
Non-GAAP operating margin | 29.6 | % | 27.3 | % | 28.8 | % | 26.5 | % | |||||||||||||||
Display and Adjacent Markets Non-GAAP Operating Income | |||||||||||||||||||||||
GAAP reported operating income | $ | 16 | $ | 32 | $ | 46 | $ | 51 | |||||||||||||||
Non-GAAP operating income | $ | 16 | $ | 32 | $ | 46 | $ | 51 | |||||||||||||||
Non-GAAP operating margin | 6.4 | % | 13.6 | % | 6.8 | % | 8.9 | % | |||||||||||||||
1 | These items are incremental charges attributable to completed acquisitions, consisting of amortization of purchased intangible assets. | ||||
Three Months Ended | |||||
(In millions, except percentages) | July 28, 2024 | ||||
GAAP provision for income taxes (a) |
$ | 255 | |||
Income tax effect of share-based compensation | (8) | ||||
Income tax effects related to intra-entity intangible asset transfers | (17) | ||||
Resolutions of prior years’ income tax filings and other tax items | 11 | ||||
Income tax effect of non-GAAP adjustments | 4 | ||||
Non-GAAP provision for income taxes (b) |
$ | 245 | |||
GAAP income before income taxes (c) |
$ | 1,960 | |||
Certain items associated with acquisitions | 10 | ||||
Acquisition integration and deal costs | 1 | ||||
Realized loss (gain), dividends and impairments on strategic investments, net | 16 | ||||
Unrealized loss (gain) on strategic investments, net | 25 | ||||
Non-GAAP income before income taxes (d) |
$ | 2,012 | |||
GAAP effective income tax rate (a/c) |
13.0 | % | |||
Non-GAAP effective income tax rate (b/d) |
12.2 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In millions) | July 28, 2024 |
July 30, 2023 |
July 28, 2024 |
July 30, 2023 |
|||||||||||||||||||
Cash provided by operating activities | $ | 2,385 | $ | 2,583 | $ | 6,102 | $ | 7,145 | |||||||||||||||
Capital expenditures | (297) | (255) | (783) | (797) | |||||||||||||||||||
Non-GAAP free cash flow | $ | 2,088 | $ | 2,328 | $ | 5,319 | $ | 6,348 |