SANTA CLARA, November 12, 2026 — Applied Materials posted record fiscal fourth-quarter revenue of $10.41 billion, a 53.1% jump year on year that sailed past consensus estimates of roughly $10.3 billion. Non-GAAP earnings hit $4.16 per share, beating the $4.05 forecast, as the semiconductor equipment maker rode a wave of AI infrastructure spending.
The Numbers Under the Hood
The Semiconductor Systems division did the heavy lifting, generating $8 billion in revenue, up 64% from the same quarter a year ago. Non-GAAP gross margin expanded 2.5 percentage points to 50.6%, while operating margin widened 6.7 points to 35.3%. Operating cash flow reached $3.30 billion and free cash flow $2.62 billion, both records. The company returned $2.42 billion to shareholders through $2 billion in share repurchases and $421 million in dividends. Short-term debt rose to $1.30 billion from $100 million a year earlier, while R&D spending climbed 23% to $1.13 billion.
Where the Demand Sits
Foundry and logic customers accounted for 58% of Semiconductor Systems revenue, a concentration that underscores the AI build-out but also flags a structural risk if that spending decelerates. DRAM represented 33% of segment sales and Flash 9%, reflecting the heavy equipment intensity of high-bandwidth memory production. For the full fiscal year, revenue reached $34.45 billion, a 21% increase from 2025, with adjusted EPS rising 37% to $12.89.
China Exposure Shifts
China generated $2.64 billion, or 25% of total revenue, down from 29% in the prior-year period. The absolute figure rose but the share fell, a detail that matters given the ongoing export control regime and the company’s customer concentration there.
Next-Generation Bets
Applied is expanding its exposure to next-generation hybrid bonding through a planned 20% stake in BE Semiconductor Industries (BESI), a move that positions it further up the advanced packaging stack as HBM manufacturing complexity increases. The company also unveiled its EPIC Center in Silicon Valley and secured 15 ecosystem partnerships, including major commitments from Intel and KIOXIA, shifting R&D toward parallel execution.
Guidance Points Higher
Management guided for fiscal first-quarter revenue of $11.1 billion, plus or minus $500 million, above the $10.89 billion consensus. Non-GAAP EPS is expected at $4.35, plus or minus $0.20, versus a $4.26 estimate. CEO Gary Dickerson said the company is on track to grow its Semiconductor Systems business more than 40% in calendar 2026. Shares rose about 3% in extended trading.
Sources
- Applied Materials surprises with Q3 sales, inventory levels improve
- The Next AI Chip Shortage May Be the Machines That Make HBM
- Applied Materials vs. Dell Technologies: Comparing Stable vs. Accelerating Revenue Between These Artificial Intelligence Companies | The Motley Fool
- Applied Materials posts record $10.41B revenue as AI chip demand drives growth
- Applied Materials (AMAT) Q4 2026 Earnings: Revenue Surges 53%
Photo: Olaf2 (CC BY-SA 4.0)
