Bakshi Finance

Applied Materials, Inc.

Technology · Santa Clara, California · NASDAQ

AMAT
Growth | Core/Tactical NASDAQ Research Depth · Standard

Company Description

Applied Materials is the world's largest manufacturer of equipment for the semiconductor manufacturing industry — the nerve center of the production processes for every modern chip. The company supplies systems for Chemical Vapor Deposition (CVD), Physical Vapor Deposition (PVD), etching, CMP, and ion implantation — three of the five core process steps in chip fabrication [source: AMAT 10-K FY2025 Item 1]. AMAT is a global top-3 player in semiconductor manufacturing equipment alongside Lam Research and KLA, with a reputation for technology leadership across several sub-areas. Its moat rests on an installed base of 65,000+ systems at the leading manufacturers (TSMC, Intel, Samsung), R&D spending of $3B+ annually, and multi-year service contracts that generate $6B+ of recurring revenue through the Applied Global Services (AGS) segment [source: AMAT 10-K FY2025 Segment Disclosure]. The business model is based on equipment sales + service + spare parts. Operating margin ~28%, gross margin 47%. Current growth is supported by the AI capex wave from hyperscalers (orders for HBM memory tools, advanced nodes) and the transition to 2nm, which forces customers into substantial capital investment. The main risk: export controls on China that have impacted $2-3B in annual revenue, plus the cyclicality of semiconductor manufacturers' capital spending [source: AMAT 10-K FY2025 Item 1A].
Sector · Sub-sectorTechnology · Semiconductor Equipment & Materials
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
HeadquartersSanta Clara, California
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Founded1967
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
CEOMr. Gary E. Dickerson
[AMAT DEF 14A filed 2026-01-28 · accession 0001193125-26-027307]
ChairmanN/A
[AMAT DEF 14A filed 2026-01-28 · accession 0001193125-26-027307]
Employees~35,500
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Market Cap$315.0B
[snapshot 2026-04-17]
Revenue FY2025$28.4B
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Net Income$7.0B
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Shares Outstanding794M
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
IRlink
Market Cap
$315.0B
794M | P/E 40.67
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742] · [yfinance snapshot 2026-04-17]
Revenue FY2025
$28.4B
+4.4% Y/Y
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Net Income
$7.0B
EPS $8.66 | -2.5% Y/Y
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Gross Margin
48.7%
Op Margin 29.9%
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
FCF
$5.7B
FCF Yield (snapshot) 1.81%
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742] · snapshot 2026-04-17
Net Cash
$1.5B Net Cash
Debt $7B | Cash $9B
[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Closing Price
$396.94
As of 2026-04-17
[yfinance snapshot 2026-04-17]
1

Financial Performance — 5 Years

Revenue ($M)
Last 5 fiscal years
Operating Income & Margin
Multi-year trend
EBITDA & Free Cash Flow
5-year trend
Revenue Breakdown
Last fiscal year
Profitability Margins — 5 Years
Gross / Operating / Net Margin %
Capital Structure
Cash, Debt, Net Debt | 5 years
2

Financial Statements

ItemFY-4FY-3FY-2FY-1FY (Latest)Source
Revenue$0.0M$25.8B$26.5B$27.2B$28.4B[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Gross Profit$0.0M$12.0B$12.4B$12.9B$13.8B[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Operating Income$0.0M$7.8B$7.7B$7.9B$8.5B[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Operating Margin %0.0%30.2%28.9%28.9%29.9%[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
EBITDA$0.0M$8.3B$8.5B$8.8B$10.2B[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
Net Income$0.0M$6.5B$6.9B$7.2B$7.0B[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
EPS ($)$0.00$7.44$8.11$8.61$8.66[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
FCF$0.0M$4.6B$7.6B$7.5B$5.7B[AMAT 10-K filed 2025-12-12 · accession 0001628280-25-056742]
3

Economic Moat

Moat Sources
[source: AMAT 10-K FY2025] Technology leadership in CVD/PVD/etch (3 of 5 key process steps)★★★★☆
[source: AMAT 10-K FY2025] Installed base 65,000+ systems at top fabs★★★★☆
[source: AMAT 10-K FY2025] Service revenue $6B+ recurring (AGS segment)★★★★☆
[source: AMAT Q4 FY2025 earnings] HBM memory + AI tailwind★★★★☆
[source: AMAT 10-K FY2025] R&D $3B+ annual — technology leadership★★★★☆
4

Valuation Multiples

MultipleCompany5Y Self-AverageGap vs. 5Y Avg
P/E (TTM) [yfinance snapshot · 5Y computed 2026-04-18]40.7x19.1x (5Y)+113.5%
P/E (Fwd) [yfinance forward consensus]28.3xN/AN/A
EV/EBITDA [yfinance snapshot · 5Y computed 2026-04-18]35.3x14.2x (5Y)+147.8%
P/S [yfinance snapshot · 5Y computed 2026-04-18]11.2x4.8x (5Y)+134.7%
P/B [yfinance snapshot · 5Y computed 2026-04-18]14.5x7.4x (5Y)+95.3%
Div Yield [yfinance snapshot · 5Y computed 2026-04-18]53.00%0.90% (5Y)+52.10pp
FCF Yield (snapshot) [computed · 2026-04-18]1.81%5.30% (5Y)-65.8%
5Y statistical averages are computed from yfinance annual data (annual income_stmt × balance_sheet × cash_flow + price snapshots at FY-end). Source: lib/compute_5y_multiples.py · Refresh: 2026-04-18
5

How to Think About This Company

A full How to Think About This Company analysis for AMAT — covering its essence, the key variables, potential analytical pitfalls, and what distinguishes professional thinking from noise — is available within the Family Office content.

The difference between surface-level analysis and professional thinking often lies in the variables that are not immediately visible.

7

Risks & Items Under Watch

Key Risks
[WARN][source: AMAT 10-K FY2025 Item 1A] China export controls — $2-3B annual revenue restricted
[WARN][source: AMAT 10-K FY2025] Cyclicality of semi CapEx (memory + logic cycles)
[WARN][source: AMAT 10-K FY2025] TSMC/Intel CapEx timing concentration
[WARN][source: AMAT 10-K FY2025] Technology node transition costs (2nm, GAA)
[WARN][source: AMAT 10-K FY2025] ASML EUV lithography dependency (not competitor but ecosystem)
[WARN][source: AMAT 10-K FY2025] Customer concentration top 3 = ~50% revenue
Items Under Watch
•[Strength] Technology leadership in CVD/PVD/etch (3 of 5 key process steps)
•[Strength] Installed base 65,000+ systems at top fabs
•[Strength] Service revenue $6B+ recurring (AGS segment)
•[Strength] HBM memory + AI tailwind
•[Strength] R&D $3B+ annual — technology leadership
•[Bull Scenario Condition] AI HBM adoption + logic node transition + China export relief
8

Scenario Framework

The framework below describes which conditions need to hold in each scenario — not a price forecast.

Scenarios are descriptive, not predictive. They outline possible conditions, not expected outcomes. These scenarios contain no probability assessment, no preferred direction, and no expectation about which one will materialize.

Bull Case
[Scenario — internal Bakshi Finance assumption] Upside scenario [source: Bakshi scenario model V2.7]
Base Case
[Scenario — internal Bakshi Finance assumption] Base case conditions [source: Bakshi scenario model V2.7]
Bear Case
[Scenario — internal Bakshi Finance assumption] Downside scenario [source: Bakshi scenario model V2.7]
The framework describes conditions, not forecasts. There is no preferred direction, probability assessment, or price target in this framework.
10

Analytical Lens — The Questions We Ask

In professional company analysis, the question is not "is this good," but "which lenses must we examine the company through to avoid missing the essence." Every analysis at Bakshi Finance passes through six lenses. The text below is not a verdict — it maps the questions this analysis is meant to answer.

The analysis is based on an internal multi-factor analytical framework used in professional portfolio management. The framework maps the questions; the answers appear woven through the analysis above.

What the lens is not: there is no rating, no score, no comparison between this company and another, and no preference. The same six questions are asked of every company on the site — what differs is the answers, not the tool.

This framework is intended to structure analysis, not to produce an investment conclusion.

•
Growth
How does the company grow? Does growth come from volume, price, or mix? Is it stable across cycles?
•
Profitability
How do margins behave over time? How much of accounting profit converts to actual free cash flow?
•
Leverage
What is the capital structure? With what flexibility could the company handle a downcycle or higher financing costs?
•
Competitive Position
What protects its revenues from erosion? How long is that protection likely to last?
•
Management Quality
How does management allocate capital? What is its track record on strategic decisions?
•
Business Complexity / Risk
Where would a simplistic analysis go wrong? What is exposed to regulation, cyclicality, or technological change?

Key Observations

This summary is not a recommendation. It is a factual list of what the analysis identified. The decision — rests with the client.

Disclosure — Family Office Format

Bakshi Finance operates as a Family Office serving qualified investors only. Mr. Yaron Bakshi was a licensed investment adviser in Israel from 2008 to 2023. As of the publication date of this document, the firm does not hold an investment advice, investment marketing, or portfolio management license. This document is intended for research and professional educational purposes only.

Nothing herein constitutes a recommendation to buy, sell, hold, or take any action with respect to any security. Nothing herein is a substitute for personal advice that takes into account the data and needs of any individual. Every decision rests solely with the investor.

Past performance is not indicative of future results.