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Technology Stocks : Applied Materials No-Politics Thread (AMAT)
AMAT 119.53-2.6%Mar 24 4:00 PM EDT

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To: Sun Tzu who wrote (25517)2/13/2020 5:11:14 PM
From: Kirk ©1 Recommendation

Recommended By
Da Rookie

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I remember when AMAT was a highly followed stock... this board is dead now.

I guess I'll significantly reduce one of my largest positions AFTER this board gains traction again!

  • Quarterly revenue of $4.16 billion, up 11 percent year over year
  • GAAP EPS of $0.96 and non-GAAP EPS of $0.98, up 20 percent and 21 percent year over year, respectively
  • Returned $392 million to shareholders

SANTA CLARA, Calif., Feb. 12, 2020 (GLOBE NEWSWIRE) -- Applied Materials, Inc. ( AMAT) today reported results for its first quarter ended Jan. 26, 2020.

First Quarter Results

Applied generated revenue of $4.16 billion. On a GAAP basis, the company recorded gross margin of 44.6 percent, operating income of $1.04 billion or 25.0 percent of net sales, and earnings per share (EPS) of $0.96.

On a non-GAAP adjusted basis, the company reported gross margin of 44.9 percent, operating income of $1.07 billion or 25.7 percent of net sales, and EPS of $0.98.

The company returned $392 million to shareholders including $200 million in share repurchases and dividends of $192 million.

“Applied Materials’ first quarter earnings exceeded the top-end of our guidance, giving us great momentum entering 2020,” said Gary Dickerson, president and CEO. “We believe we can deliver strong double-digit growth in our semiconductor business this year as our unique solutions accelerate our customers’ success in the AI-Big Data era.”

Quarterly Results Summary

Q1 FY2020Q1 FY2019Change
(In millions, except per share amounts and percentages)
Net sales$4,162$3,75311%
Gross margin44.6%44.4%0.2 points
Operating margin25.0%24.2%0.8 points
Net income$892$77116%
Diluted earnings per share$0.96$0.8020%
Non-GAAP Adjusted Results
Non-GAAP adjusted gross margin44.9%44.6%0.3 points
Non-GAAP adjusted operating margin25.7%24.6%1.1 points
Non-GAAP adjusted net income$904$77916%
Non-GAAP adjusted diluted EPS$0.98$0.8121%

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 second quarter of fiscal 2020, Applied expects net sales to be approximately $4.34 billion, plus or minus $200 million. Non-GAAP adjusted diluted EPS is expected to be in the range of $0.98 to $1.10.

This outlook for non-GAAP adjusted diluted EPS excludes known charges related to completed acquisitions of $0.01 per share, includes the normalized tax benefit of share-based compensation of $0.01 per share and net income tax benefit related to intra-entity intangible asset transfers of $0.03 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.

First Quarter Reportable Segment Information

Semiconductor SystemsQ1 FY2020Q1 FY2019
(In millions, except percentages)
Net sales$2,814$2,268
Foundry, logic and other68%44%
Operating income915631
Operating margin32.5%27.8%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income$925$642
Non-GAAP adjusted operating margin32.9%28.3%

Applied Global ServicesQ1 FY2020Q1 FY2019
(In millions, except percentages)
Net sales$997$962
Operating income278285
Operating margin27.9%29.6%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income$278$285
Non-GAAP adjusted operating margin27.9%29.6%

Display and Adjacent MarketsQ1 FY2020Q1 FY2019
(In millions, except percentages)
Net sales$332$507
Operating income38115
Operating margin11.4%22.7%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income$41$118
Non-GAAP adjusted operating margin12.3%23.3%

Use of Non-GAAP Adjusted Financial Measures

Applied provides investors with certain non-GAAP adjusted financial measures, which are adjusted for 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; tax effect of share-based compensation; certain income tax items and other discrete adjustments. Additionally, non-GAAP results exclude estimated discrete income tax expense items associated with changes to U.S. tax legislation. 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 its 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 management does not believe are indicative of Applied's 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 A replay will be available on the website beginning at 5:00 p.m. Pacific Time today
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