Applied Materials (AMAT) Q4 2026 earnings summary

Executive summary

• Record FY2026 results and AI-led demand reflect strength in leading-edge logic, DRAM, advanced packaging, and process control.

• Management expects another record market year in 2027, with WFE demand forecast to grow more than 30% and continued market outperformance.

• Capacity plans target doubling systems output from Q4 FY2026 levels by 2028 and more than doubling manufacturing and lab capacity by 2030.

Financial highlights

• FY2026 revenue was $34.446B, up 21%; non-GAAP gross margin rose 130 bps to 50.1%, and non-GAAP EPS increased 37% to $12.89.

• Q4 revenue reached $10.409B, up 53% YoY; non-GAAP EPS was $4.16, up 92% YoY.

• Q4 net income was $2.718B, up 43% YoY; FY net income was $10.088B, up 44%.

• Record operating cash flow was $3.300B in Q4 and $8.868B for FY; non-GAAP free cash flow was $2.616B and $6.196B, respectively.

• FY operating cash flow increased 11% and free cash flow rose 9%, after $2.672B of capital expenditures.

Outlook and guidance

• Q1 FY2027 revenue guidance is $11.1B ± $500M and non-GAAP diluted EPS is $4.35 ± $0.20.

• Q1 EPS outlook excludes $0.01/share of known acquisition charges and includes a $0.04/share tax benefit from intra-entity intangible asset transfers.

• Q1 Semiconductor Systems revenue is expected at ~$8.7B, AGS at ~$2B, and Other at ~$400M; AGS revenue is expected to stay near Q1 levels in Q2.

• Semiconductor Systems is expected to grow more than 40% in calendar 2026; systems output is expected to increase each quarter.

• Q1 non-GAAP gross margin is expected at ~50.8%, with non-GAAP OpEx of ~$1.7B and a tax rate of ~13%.