Applied Materials posted stronger-than-expected fourth-quarter results, with adjusted earnings per share of $4.16 topping the consensus estimate of $4.13 and record quarterly revenue of $10.41 billion slightly exceeding the $10.30 billion consensus forecast.
For the quarter ended October 25, 2026, the Santa Clara-based semiconductor equipment company reported record quarterly revenue that rose 53 percent year over year. On a GAAP basis, fourth-quarter EPS reached $3.40, up 43 percent from the prior year. Non-GAAP EPS of $4.16 climbed 92 percent year over year.
Full-Year Performance
For fiscal 2026, Applied Materials generated record revenue of $34.45 billion, up 21 percent year over year. Record annual GAAP EPS was $12.62 and record non-GAAP EPS was $12.89. The company also reported record annual cash from operations of $8.87 billion.
Segment Results
Semiconductor Systems revenue reached $7.996 billion in the quarter, compared with $4.879 billion in the fourth quarter of fiscal 2025. GAAP gross margin was 50.4 percent; non-GAAP gross margin was 50.6 percent.
Shareholder Returns and Capital Allocation
Applied Materials generated record quarterly free cash flow of $2.6 billion and distributed over $2.4 billion to shareholders during the quarter. That included $2 billion in share repurchases and $421 million in dividends. The company also entered an accelerated share purchase agreement to raise its investment in Besi to approximately 20 percent of Besi's outstanding shares.
Forward Guidance
For the first quarter of fiscal 2027, Applied guided total revenue of $11.1 billion plus or minus $500 million and non-GAAP diluted EPS of $4.35 plus or minus $0.20.
Strategic Developments
Applied Materials unveiled the EPIC Center in Silicon Valley and announced four new partnerships, bringing the total to 15. The new partners are Intel, KIOXIA Corporation, Besi, and the UCLA Samueli School of Engineering. The company also introduced the VeritySEM 20 metrology system for high-NA EUV patterning control.
CEO Gary Dickerson stated that Applied Materials delivered record results in fiscal 2026 and is on track to grow its Semiconductor Systems business more than 40 percent in calendar 2026. GAAP fiscal 2026 results included a $253 million charge for a settlement with the US Commerce Department Bureau of Industry and Security.
