The 10-second takeaway
For the quarter ended Jan. 27 (Q1), Applied Materials beat slightly 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.
Gross margins grew, operating margins contracted, net margins dropped.
Applied Materials logged revenue of $1.57 billion. The 16 analysts polled by S&P Capital IQ predicted revenue of $1.56 billion on the same basis. GAAP reported sales were 28% lower than the prior-year quarter's $2.19 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.06. The 16 earnings estimates compiled by S&P Capital IQ anticipated $0.03 per share. GAAP EPS of $0.03 for Q1 were 67% lower than the prior-year quarter's $0.09 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 37.0%, 110 basis points better than the prior-year quarter. Operating margin was 3.1%, 900 basis points worse than the prior-year quarter. Net margin was 2.2%, 310 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.81 billion. On the bottom line, the average EPS estimate is $0.12.
Next year's average estimate for revenue is $7.79 billion. The average EPS estimate is $0.59.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,017 members out of 2,133 rating the stock outperform, and 116 members rating it underperform. Among 472 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 452 give Applied Materials a green thumbs-up, and 20 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 $12.88.
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