Applied Materials Posts $10.4B, Guides $11.1B in 14 Weeks

Applied Materials on 12 November reported record fiscal fourth-quarter revenue of $10.41 billion, up 53% from a year earlier, and guided first-quarter fiscal 2027 revenue to $11.1 billion, plus or minus $500 million. Its earnings presentation adds that the first quarter of fiscal 2027 will be a 14-week quarter.

Per week, the $11.1 billion midpoint works out to about $793 million, against about $801 million in the 13-week fourth quarter, by our arithmetic. The guide is 6.6% above the fourth quarter in total, but roughly 1% lower per week.

Business Pill · Year-over-Year Growth

A short explainer on comparing growth rates: compared with what, and over how long. It teaches the general idea only and does not discuss Applied Materials.

The Quarter in Numbers

Revenue for the quarter ended 25 October was $10,409 million, against $6,800 million a year earlier. GAAP gross margin was 50.4% and non-GAAP gross margin 50.6%, up 240 and 250 basis points. GAAP operating income was a record $3.66 billion, or 35.1% of revenue.

GAAP earnings per share were $3.40, up 43%, and non-GAAP EPS a record $4.16, up 92%. The gap between the two is mostly an unrealized loss on strategic investments, worth $0.68 a share in the company’s reconciliation.

In August, Applied guided the quarter to $10.25 billion, plus or minus $500 million, and non-GAAP EPS of $4.02, plus or minus $0.20, as we noted in our preview. Revenue came in $159 million above that midpoint, or 1.6%, and EPS $0.14 above it, by our arithmetic.

Against Wall Street Estimates

The Wall St Engine earnings card put consensus at $10.3 billion for revenue and $4.05 for adjusted EPS, and at $10.89 billion and $4.26 for the first-quarter guide. Those estimates are as cited by Wall St Engine; we have not checked them against a data provider.

The Guide and the 14th Week

For the first quarter of fiscal 2027, Applied expects revenue of $11.1 billion, plus or minus $500 million, and non-GAAP EPS of $4.35, plus or minus $0.20. The presentation splits the revenue into about $8.7 billion from Semiconductor Systems, about $2.0 billion from Applied Global Services and about $400 million from other businesses.

It guides non-GAAP gross margin to about 50.8%, non-GAAP operating expenses to about $1.7 billion and a non-GAAP tax rate of about 13%, up from 11.0% in the fourth quarter.

Against the $7,012 million Applied reported for the first quarter of fiscal 2026, the midpoint is 58% higher, by our arithmetic. That comparison sets 14 weeks against 13. The fourth quarter ran from 27 July to 25 October, 13 weeks, based on the period end dates in Applied’s filings.

Growth Targets Raised

Chief executive Gary Dickerson said in the release: “we are on track to grow our Semiconductor Systems business more than 40 percent in our calendar 2026”. In May the company expected that business to grow more than 30% in calendar 2026. Applied’s calendar 2026 runs from the second quarter of fiscal 2026 through the first quarter of fiscal 2027.

For calendar 2026 the presentation also expects about 90% growth in advanced packaging and more than 50% in inspection and metrology. For 2027 it expects wafer fab equipment to grow more than 30%, and says the largest customers are “giving 8-quarter forecasts and earlier orders”.

Segments, Regions and Cash

Semiconductor Systems revenue was $7,996 million, up 64%, with DRAM at 33% of it, up from 28% a year earlier. That rise in DRAM’s share follows DRAM revenue up 369% in the third quarter in Counterpoint’s count, as we reported, and Winbond laying out an EUV path. Applied Global Services, the services business, grew 26% to a record $1,896 million.

Taiwan was the largest region at $2,916 million, or 28% of revenue, and the presentation lists record Korea and Taiwan revenue; Taiwan’s exports hit a record on 9 November, as we reported. China was $2,642 million, or 25%, down from 29% a year earlier.

Cash from operations was a record $3.30 billion and non-GAAP free cash flow $2.62 billion. Applied bought back $2.00 billion of stock, which CFO Brice Hill called “the largest quarterly share buyback in more than eight years”, and paid $421 million in dividends.

The Structural Read

As we read the presentation, Applied says its largest customers give 8-quarter forecasts and earlier orders, and it raised its calendar 2026 Semiconductor Systems growth expectation from more than 30% in May to more than 40%.

As we read the segment table, DRAM rose to 33% of Semiconductor Systems revenue from 28% a year earlier, while foundry and logic fell to 58% from 66%.

Three Implications

FOR THE GUIDE Applied guides $11.1 billion over 14 weeks; set against 13-week quarters, the per-week view is the like-for-like one.

FOR MEMORY DRAM was 33% of Semiconductor Systems revenue, and the presentation lists record DRAM and advanced packaging revenue.

FOR OUR COVERAGE We will report the earnings call script and the annual report when Applied publishes them.

The Business Engineer Lens

This story maps onto the Business Engineer framework The AI Capex Map & The State of AI Hyperscalers.

The framework says: “This is not a continuation of the cloud capex cycle.”

Applied’s presentation says cloud capex is expected to grow more than 50% in 2027 to well over $1 trillion, and that leading-edge foundry-logic and DRAM fabs are running at full utilization. The framework predates the results and does not discuss Applied.

What Is Not Established

The release and presentation give no China revenue outlook and no wafer fab equipment dollar forecast for 2027, only growth of more than 30%. Applied had not yet posted a script of its earnings call when we read the documents. The first-quarter guide does not say how much revenue the extra week adds.

The Bottom Line

Applied Materials topped its own revenue guide by 1.6% with a record $10.41 billion quarter and guided to $11.1 billion next. That guide covers 14 weeks, so per week it is about 1% below the fourth quarter, by our arithmetic.