Applied Materials (AMAT) Goldman Sachs Communacopia + Technology Conference 2026 summary

Market and technology drivers

• AI and data center demand now matches and will soon surpass smartphone demand, driving 80% of wafer fab equipment (WFE) growth this year and expected to continue through 2027 and beyond.

• Revenue forecasts for 2026 have been raised from over 20% to nearly 40% growth, with agentic AI and compute demand as key drivers.

• Customers provide rolling eight-quarter forecasts and commitments extending to 2030, reflecting strong, long-term demand visibility.

• AI is seen as the most significant technology inflection, fundamentally transforming all industries and driving secular growth.

• Leading-edge foundry logic, DRAM (including High-Bandwidth Memory), and advanced packaging are the fastest-growing segments.

Business performance and innovation

• Service business is growing over 20% year-over-year, with margins up 180 basis points, driven by predictive models and preventative maintenance.

• Advanced packaging revenue is forecasted to grow over 70% this year, reaching $2–3 billion, and is expected to remain a top growth segment.

• Process control and inspection measurement businesses are growing over 50% this year, with strong leadership in electron beam and optical technologies.

• Internal AI use has improved product development productivity by 50% and accelerated the launch of multi-billion dollar products.

• Over 37,000 chambers are connected to AI-enabled servers, enabling significant yield and output improvements for customers.

Regional and customer dynamics

• U.S. market share is strong, especially in leading-edge foundry, DRAM, and advanced packaging, with regionalization providing a tailwind for services.

• Engagement with all major players in AI compute, including new entrants, is deep and focused on co-innovation and rapid technology deployment.

• China growth is concentrated in ICAPS (IoT, communication, auto, power, sensors), with mid to high single-digit growth, while AI and data center segments drive global growth.

• Regional expansion into new geographies boosts service business due to the need for rapid yield ramp-up and infrastructure setup.