Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Applied Materials (AMAT) delivered a strong Q2 FY2026 with revenue of $7.91B (+11.4% YoY), net income surging 31.3% to $2.81B, and EPS of $3.51 (diluted), driven by expanding margins and robust demand for semiconductor equipment.
Revenue
$7.91B
+11.41% YoY
EPS (Diluted)
$3.51
+33.46% YoY
Gross Margin
49.9%
+0.8 pts YoY
Operating Income
$2.52B
+16.32% YoY
Source: SEC XBRL
Applied Materials (AMAT) reported Q2 FY2026 revenue of $7.91B, up 11.4% year over year. Operating margin was 31.9%, up 1.4 points from 30.5% a year earlier. AMAT's fiscal Q2 FY2026 corresponds to calendar Q2 2026.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Sep 2026 | 3.50 | 3.46 | Beat +1.1% |
| Jun 2026This filing | 2.86 | 2.72 | Beat +5.2% |
| Mar 2026 | 2.38 | 2.25 | Beat +5.9% |
| Dec 2025 | 2.17 | 2.14 | Beat +1.6% |
Adjusted (non-GAAP) EPS of $2.86 versus the $2.72 analyst consensus — a +5.2% beat for Jun 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $3.51.
Compiled by AI from this SEC filing
Revenue grew 11.4% YoY to $7.91B in Q2 FY2026, reflecting continued strong demand for chip manufacturing equipment as semiconductor manufacturers invest in advanced process nodes and capacity expansion.
Source: 10-Q Income Statement (XBRL Financial Data)
Gross margin improved to 49.9% (from 49.1% a year ago), operating margin expanded to 31.9% (from 30.5%), and net margin reached 35.5%, indicating improved operational efficiency and favorable product mix.
Source: 10-Q Income Statement & Key Ratios (XBRL Financial Data)
Net income of $2.81B grew 31.3% YoY — nearly three times the revenue growth rate of 11.4% — suggesting meaningful below-the-line benefits such as investment gains, tax benefits, or other non-operating income contributing to profitability.
Source: 10-Q Income Statement (XBRL Financial Data)
R&D expense increased 15.0% YoY to $1.03B, outpacing revenue growth, signaling AMAT's commitment to next-generation semiconductor equipment technologies to maintain competitive positioning.
Source: 10-Q Income Statement (XBRL Financial Data)
Stockholders' equity rose 26.1% YoY to $23.91B while long-term debt declined 3.8% to $5.26B, resulting in a debt-to-equity ratio of 0.68 and a healthy current ratio of 2.51, reflecting a solid financial position.
Source: 10-Q Balance Sheet (XBRL Financial Data)
Compiled by AI from this SEC filing · 2 high, 2 medium, 1 low
Applied Materials derives a significant portion of revenue from customers in China and other regions subject to evolving U.S. export control regulations. Tightening restrictions on semiconductor equipment exports could materially reduce addressable market and revenue. This risk has intensified given ongoing U.S.-China technology tensions.
Source: 10-Q Risk Factors (inferred from financial data and industry context)
AMAT's revenue is heavily dependent on capital expenditure decisions by a relatively small number of large semiconductor manufacturers. A slowdown in customer capex — due to inventory corrections, demand weakness, or macro deterioration — could cause rapid revenue declines given the lumpy nature of equipment orders.
Source: 10-Q Income Statement (XBRL Financial Data)
Year-to-date investing cash flow deteriorated sharply to -$1.74B from -$676M in the prior-year period, a 157.2% increase in outflows. This significant acceleration in capital deployment warrants monitoring to ensure returns justify the investment and liquidity is preserved.
Source: 10-Q Cash Flow Statement (XBRL Financial Data)
R&D expenses grew 15.0% YoY to $1.03B, outpacing revenue growth. Failure to successfully commercialize next-generation equipment technologies could result in loss of market share to competitors like ASML, Lam Research, or KLA, eroding the premium margins AMAT currently enjoys.
Source: 10-Q Income Statement (XBRL Financial Data)
Year-to-date share repurchases fell 75.3% YoY to $737M from $2.99B, suggesting a significant shift in capital allocation priorities. While dividends grew 12.1%, the reduction in buybacks may reflect increased investment needs or caution about near-term business conditions.
Source: 10-Q Cash Flow Statement (XBRL Financial Data)
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 7.91 $B | 7.10 $B | +11.41% |
Cost of Revenue $B | 3.96 $B | 3.62 $B | +9.63% |
Gross Profit $B | 3.95 $B | 3.49 $B | +13.26% |
Operating Income $B | 2.52 $B | 2.17 $B | +16.32% |
Net Income $B | 2.81 $B | 2.14 $B | +31.31% |
EPS (Basic) $ | 3.53 $ | 2.64 $ | +33.71% |
EPS (Diluted) $ | 3.51 $ | 2.63 $ | +33.46% |
R&D Expense $B | 1.03 $B | 0.89 $B | +15.01% |
SG&A Expense $M | 397.00 $M | 423.00 $M | -6.15% |
Answers draw on this SEC filing and the data on this page
Applied Materials delivered broad-based revenue growth and margin expansion in Q3 FY2026, but a swing to unrealized losses on equity investments weighed on other income.
AMAT reported Q1 FY2026 revenue of $7.01B (down 2.1% YoY) while net income surged 71% to $2.03B, largely driven by a non-operating gain that boosted margins well above operating-level performance.
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