What happened

Shares of Applied Materials (NASDAQ:AMAT) climbed 86.4% in 2019, according to data from S&P Global Market Intelligence, after there were signs of renewed demand for the semiconductor equipment leader's wares as industry spending began to rebound. The top tech stock absolutely smashed the S&P 500's roughly 29% return in the process.

Digital world map with various stock market charts indicating gains.

IMAGE SOURCE: GETTY IMAGES.

So what

To be fair, we should note that Applied Materials stock effectively rebounded from a nearly 40% drop in 2018, amid persistently weak demand in the broader semiconductor space. Shares currently trade almost exactly even with their March 2018 high as of this writing.

But it certainly helped that Applied Materials shares started 2019 on a high note, rising more than 19% in January alone after multiple analysts offered prescient bullish notes highlighting its status as a key beneficiary should the industry enjoy a steady rebound as the year wore on.

And that's exactly what happened: The rally gained steam in May after Applied Materials posted better-than-feared fiscal second-quarter 2019 results, with revenue and adjusted net income declining by "just" 23% and 47% year over year, respectively.

Fast-forward to Applied Materials' most recent (fiscal fourth-quarter 2019) results -- which caused another 9% single-day pop in November -- and its situation has obviously continued to improve. Fiscal Q4 sales fell slightly to $3.75 billion, and adjusted net income per share declined a modest 11% to $744 million (down 6% on a per-share basis to $0.80).

Now what

In that quarter's earnings press release, Applied Materials CEO Gary Dickerson credited the company's relative outperformance to a "healthy uptick in demand for semiconductor equipment, combined with strong execution across the company."

"The semiconductor industry is increasingly adopting a new playbook for improving chip performance, power, area, and cost," Dickerson added, "and we are investing in unique solutions to enable our customers' success in the AI-Big Data era."

Investors should receive fresh color on Applied Materials' latest performance when it releases fiscal first-quarter 2020 results in mid-February. But there's no denying that Applied Materials' business is in a much better place today than it stood a year ago. And its share price responded accordingly in 2019.