Applied Materials Beats Expectations but Takes a Step Back Anyway
Applied Materials (NAS: AMAT) reported earnings on Feb. 16. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended Jan. 29 (Q1), Applied Materials beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share contracted significantly.
Margins contracted across the board.
Applied Materials chalked up revenue of $2.19 billion. The 18 analysts polled by S&P Capital IQ expected a top line of $1.97 billion on the same basis. GAAP reported sales were 19% lower than the prior-year quarter's $2.69 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.18. The 21 earnings estimates compiled by S&P Capital IQ forecast $0.12 per share on the same basis. GAAP EPS of $0.09 for Q1 were 76% lower than the prior-year quarter's $0.38 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 35.9%, 640 basis points worse than the prior-year quarter. Operating margin was 8.2%, 1,580 basis points worse than the prior-year quarter. Net margin was 5.3%, 1,350 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.40 billion.
Next year's average estimate for revenue is $9.47 billion.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,997 members out of 2,098 rating the stock outperform, and 102 members rating it underperform. Among 502 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 484 give Applied Materials a green thumbs-up, and 18 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Applied Materials is outperform, with an average price target of $13.42.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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