Applied Materials Q4 Earnings Beat Estimates, Revenues Fall Y/Y

Applied Materials Inc. AMAT reported fourth-quarter fiscal 2025 non-GAAP earnings of $2.17 per share, which beat the Zacks Consensus Estimate by 2.8%. AMAT’s fourth-quarter fiscal 2025 non-GAAP earnings declined 6.5% from the year-ago quarter’s reported figure.

AMAT beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 5%.

AMAT reported revenues of $6.8 billion in the fourth quarter of fiscal 2025, surpassing the Zacks Consensus Estimate by 1.5%. The top line decreased 3% from the year-ago quarter.

AMAT’s Q4 Earnings in Detail

Segment-wise, Semiconductor Systems generated revenues of $4.76 billion, contributing 70% to total net revenues and declining 8.1% from the year-ago quarter. The figure fell short of the Zacks Consensus Estimate of $4.79 billion.

Applied Materials, Inc. Price, Consensus and EPS Surprise

Applied Materials, Inc. price-consensus-eps-surprise-chart | Applied Materials, Inc. Quote

Applied Global Services posted revenues of $1.63 billion (23.9% of total net revenues), which declined 0.9% year over year but surpassed the Zacks Consensus Estimate of $1.60 billion.

Corporate and Other revenues totaled $415 million (6.1% of total revenues), up 81.2% year over year. Revenues from the Display segment, now included under Corporate and Other, were $355 million (5.2% of total net revenues).

Revenues in the United States, Europe, Japan, Korea, Taiwan, Southeast Asia and China were $655 million, $220 million, $448 million, $1.22 billion, $1.83 billion, $460 million and $1.96 billion, contributing 10%, 3%, 6%, 18%, 27%, 7% and 29% to total net sales, respectively.

Year over year, revenues in Korea, Taiwan and Southeast Asia grew 4%, 42.7% and 46.5%, respectively, while revenues in Japan, Europe, China and the United States declined 22.9%, 45.7%, 8.1% and 43.2%, respectively.

AMAT’s Margins in Detail

The non-GAAP gross margin was 48.1%, expanding 60 basis points year over year. Non-GAAP operating expenses were $1.33 billion, roughly flat year over year, while declining to 19.5% of sales from the prior year level.

The non-GAAP operating margin came in at 28.6%, down 70 basis points from the year-ago quarter.

Balance Sheet & Cash Flow of AMAT

As of Oct. 26, 2025, cash and cash equivalents plus short-term investments were $8.57 billion, up from $7.01 billion at the end of the prior quarter. Long-term debt was $6.46 billion at the end of the fourth quarter of fiscal 2025.

Applied Materials generated non-GAAP free cash flow of $2.04 billion. The company returned $1.22 billion to shareholders, including $851 million in share repurchases and $365 million in dividends for the quarter.

AMAT Initiates Q1 Guidance

For the fiscal first quarter of 2026, Applied Materials expects net sales of $6.85 billion (+/- $500 million). The Zacks Consensus Estimate is pegged at $6.89 billion.

Semiconductor Systems, Applied Global Services, and Display (reported under Corporate & Other) sales are anticipated to be $5.03 billion, $1.52 billion, and $305 million, respectively.

Applied Materials expects a non-GAAP gross margin of approximately 48.4% and non-GAAP operating expenses of around $1.33 billion. It projects a non-GAAP tax rate of roughly 13%.

Management expects non-GAAP earnings per share of $2.18 (+/- $0.20). The Zacks Consensus Estimate is pegged at $2.19.

AMAT Zacks Rank & Stocks to Consider

Currently, AMAT has a Zacks Rank #3 (Hold).

NVIDIA NVDA, Bullish BLSH, and Dell Technologies DELL are some better-ranked stocks that investors can consider in the broader sector. Each stock presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

NVIDIA shares have risen 43.9% year to date. NVDA is scheduled to report third-quarter fiscal 2026 results on Nov. 19.

Shares of Bullish have gained 11.1% year to date. BLSH is set to report third-quarter 2025 results on Nov. 19.

Shares of Dell Technologies have gained 11.1% year to date. DELL is set to report third-quarter fiscal 2026 results on Nov. 25.

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