# Applied Materials Inc. (AMAT)

> Makes and services the machines chipmakers use to build, inspect and package chips, and sells software and equipment for related factories.

- Exchange: Nasdaq · Sector: Technology · Industry: Semiconductor Equipment and Materials
- Headquarters: Santa Clara, California
- Founded: 1967 (incorporated)
- Employees: approximately 36,500 (October 26, 2025)
- SEC CIK: 0000006951 ([filings on EDGAR](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000006951))
- Full page: https://inspectstocks.com/stocks/amat
- Data as of: price 2026-09-29; newest filing used 2026-08-20; latest fiscal period ended 2026-07-26

## Grade

**C+** on the growth-and-cash rubric, 3 of 5 checks passed.

| Check | Result | Now | Before |
| --- | --- | --- | --- |
| Revenue growing overall | passed | $30.8B | $26.5B |
| Revenue growing recently | passed | $30.8B | $28.4B |
| Free cash flow positive | passed | $5.6B |  |
| Free cash flow growing overall | failed | $5.6B | $7B |
| Free cash flow growing recently | failed | $5.6B | $5.7B |

Business quality (the + / − mark): 6 of 6 checks passed.

| Check | Result | Now | Before |
| --- | --- | --- | --- |
| Profitable | passed | 30.1% |  |
| Healthy profit margin | passed | 30.1% |  |
| Strong operating margin | passed | 29.6% |  |
| Good return on equity | passed | 45.4% |  |
| Debt under control | passed | 0.35 |  |
| Turns sales into cash | passed | 18.2% |  |

How the grade works: the letter counts failed checks (none → A, one → B, two → C, three → D, four or more → F). It is built from SEC filings only — the share price never enters it — and describes the business, not whether the stock is worth buying.

## Key figures

In US dollars, as filed.

| Measure | Value |
| --- | --- |
| Revenue, trailing twelve months | $30.8B |
| Net income, trailing twelve months | $9.3B |
| Free cash flow, trailing twelve months | $5.6B |
| Net margin | 30.1% |
| Operating margin | 29.6% |
| Return on equity | 45.4% |
| Debt to equity | 0.35 |
| Diluted EPS, trailing twelve months | $11.59 |
| Share price | $512.03 |
| Market value | $406.3B |
| Price / earnings | 44.2x |
| Price / sales | 13.2x |

## What the business does

Applied Materials makes equipment that chipmakers use to form patterns, build chip structures and wiring, inspect production, and connect chips together. It also sells replacement parts, factory software, and services to keep equipment running and help chip factories improve production. Its customers include semiconductor manufacturers and companies that make display products.

### How it makes money

- **Semiconductor Systems equipment** (77.2% (three months ended July 26, 2026)) — Chipmakers buy equipment for making and packaging chips, usually through Applied Materials' direct sales force.
- **Applied Global Services** (19.5% (three months ended July 26, 2026)) — Factories pay for replacement parts, equipment service, factory software, and recurring service agreements.

### Products

- **Patterning equipment** — Machines and processes that form the tiny patterns used to make chip structures.
- **Deposition and epitaxy equipment** — Machines that add thin layers of material to a chip wafer; epitaxy grows a carefully controlled crystal layer.
- **Etch and materials-modification equipment** — Machines that remove selected material or change its properties as chip structures are built.
- **Metrology and inspection equipment** — Optical and electron-beam machines that measure and inspect chip features during production to help find defects.
- **Advanced packaging equipment** — Machines that connect separate chip pieces into a finished package; examples include plating and polishing equipment.
- **Factory services, parts and software** — Field service, replacement parts and factory-automation software for semiconductor and other equipment. On its Q3 fiscal 2026 call, the company said more than 37,000 (Q3 fiscal 2026 call, high) equipment chambers were connected to its AIx software.

### Customers

- Semiconductor manufacturers that make chips for other companies or design and manufacture their own chips; they buy production equipment directly from Applied Materials.
- Chip factories that buy service agreements, replacement parts and factory software, either as recurring agreements or as needed.
- Manufacturers of display products that buy display-industry manufacturing equipment.

### Competitors

- Lam Research Corporation (LRCX) — Makes chip-fabrication equipment, including equipment used to deposit and remove materials.
- KLA Corporation (KLAC) — Makes equipment that measures and inspects chip features during production.
- Tokyo Electron Limited (TOELY) — Makes equipment used in several chip-fabrication steps, including coating, etching and cleaning wafers.

### What it depends on

- Equipment sales depend on semiconductor manufacturers' factory investment plans, which can change with chip demand, factory use and production technology changes.
- Two customers accounted for notable portions of fiscal 2025 revenue, making the company sensitive to large customers changing orders or spending.
- Some important parts come from a single qualified supplier or a limited group of suppliers.
- Service and replacement-parts demand depends in part on the size and use of Applied Materials' installed base of equipment.
- United States export rules affect which products and services the company can provide to some customers, including in China.

### What could go wrong

- Chipmakers can delay or reduce factory equipment spending as demand, production levels or technology plans change; customers may also delay deliveries or cancel some orders before shipment.
- Changing export controls, tariffs and trade disputes can restrict sales to customers in certain countries and affect the cost or competitiveness of products.
- The company has a concentrated customer base and relies on some single-source or limited-source suppliers for key parts, so customer cutbacks or supply interruptions can affect deliveries and results.

## More on this company

- [Overview](https://inspectstocks.com/stocks/amat)
- [Financial statements](https://inspectstocks.com/stocks/amat/financials)
- [Competitors](https://inspectstocks.com/stocks/amat/peers)
- [Earnings](https://inspectstocks.com/stocks/amat/earnings)

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Source: InspectStocks, built from the company’s own SEC filings. This describes a business — it is not investment advice and not a recommendation to buy or sell anything.