Key Highlights

  • Applied Materials (NASDAQ:AMAT) reported record fiscal fourth quarter Revenue of USD 10.41 billion, up 53% and above the USD 10.30 billion estimate, on November 12, 2026.
  • Non GAAP Earnings Per Share were USD 4.16 against USD 4.06 expected and USD 2.17 a year earlier, and GAAP earnings were USD 3.40.
  • First quarter guidance is revenue of about USD 11.1 billion plus or minus USD 0.5 billion and earnings of about USD 4.35, ahead of Street figures of USD 10.85 billion and USD 4.24.
  • The shares fell 3.58% in the regular session, before the report, and traded about 1% higher after hours.

A Record Quarter Driven by Systems

Semiconductor Systems revenue reached about USD 8.0 billion, up from USD 4.88 billion a year earlier, and Applied Global Services rose to about USD 1.9 billion from USD 1.51 billion. Non GAAP gross Margin improved to 50.6% from 48.1%, and Net Income was USD 2.71 billion against USD 1.89 billion. For the full fiscal year, revenue was about USD 34.45 billion, up 21%, and non GAAP earnings per share were USD 12.89, up 37%. The company returned USD 2.42 billion to shareholders in the quarter. The results show that equipment Demand is accelerating as chipmakers build capacity for AI processors, advanced memory and leading edge logic, and the growth in the systems unit was far faster than that of the services business. The mix also shows operating leverage. Revenue rose by about USD 3.6 billion from a year earlier while net income rose by about USD 0.8 billion, and the gross margin gain of 2.5 points suggests that the company is capturing value from more complex tools used for advanced chips, even as costs for new products rise.

What Management Said

Chief Executive Gary Dickerson said that AI continues to fuel strong incremental demand for semiconductors, and that the company expects its Semiconductor Systems Business to grow by more than 40% in calendar 2026. The first quarter guide of about USD 11.1 billion, with a range from USD 10.6 billion to USD 11.6 billion, and earnings of about USD 4.35, is above what investors had modeled. The company is also investing in research, including a USD 5 billion advanced R&D center in Silicon Valley that it announced earlier, and it has said it is working with customers on new transistor and packaging technologies that need more deposition and etch steps. Share of sales from China was not available in the early summaries. The company also noted demand from advanced packaging and high bandwidth memory, which requires many new process steps. Investors will look for the share of revenue from leading edge logic, memory and China in the annual report, because the mix will influence margins over the next year.

How the Market Reacted

Applied Materials fell 3.58% in the regular session after the news of Nvidia's chief executive leaving, but the shares recovered about 1% after hours as the figures came out. They are up about 48% for the year, which sets a high bar for the report. Equipment stocks are sensitive to export rules, and Congress is pressing for tighter limits on China, which could affect sales, so investors will look for comments from management on how much of the Backlog is exposed. Memory and foundry customers continue to raise Capital spending plans, which supports the outlook for 2027. The AI related equipment cycle has persuaded many investors that growth in the sector could extend into 2027, but the stock has already moved a long way. Even so, a guide that exceeds expectations by a clear margin supports the argument that earnings can keep rising faster than the share price.

Where Things Stand

Friday's open will show whether the guide is enough to offset concerns about China rules and Nvidia. Watch comments on order backlog, memory spending and any change in the export outlook, and the next report in February for evidence that the 40% growth target for systems is on track.