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FY2026 Q2
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Applied Materials, Inc. earnings call
Buzzberg read
2026 semi equipment growth upgraded to over 30%
Applied Materials reported record revenue and guided Q3 well above expectations, attributing the strength to accelerating AI adoption driving WFE growth of 30%+ this year. Management highlighted strong demand in leading-edge logic, DRAM, and advanced packaging and emphasized unprecedented visibility into 2027. Q2 revenue: $7.91B, EPS: $2.86; Q3 revenue guide: ~$8.95B (~23% YoY growth), EPS guide: ~$3.36.
Buzzberg read 2026 semi equipment growth upgraded to over 30% Applied Materials reported record revenue and guided Q3 well above expectations, attributing the strength to accelerating AI adoption driving WFE growth of 30%+ this year. Management highlighted strong demand in leading-edge logic, DRAM, and advanced packaging and emphasized unprecedented visibility into 2027. Q2 revenue: $7.91B, EPS: $2.86; Q3 revenue guide: ~$8.95B (~23% YoY growth), EPS guide: ~$3.36. Read full analysisCollapse analysis
Applied Materials reported record revenue and guided Q3 well above expectations, attributing the strength to accelerating AI adoption driving WFE growth of 30%+ this year. Management highlighted strong demand in leading-edge logic, DRAM, and advanced packaging and emphasized unprecedented visibility into 2027. Q2 revenue: $7.91B, EPS: $2.86; Q3 revenue guide: ~$8.95B (~23% YoY growth), EPS guide: ~$3.36.
- WFE growth expectation raised to 30%+ for calendar 2026.
- Leading-edge foundry/logic, DRAM, and advanced packaging expected to account for >80% of WFE growth in 2026 and 2027.
- Customers providing rolling eight-quarter forecasts, giving AMAT strong visibility and enabling supply chain planning.
AGS Revenue$1.67BReported
SEMICONDUCTOR_SYSTEMS Revenue$5.97BReported
Revenue$7.91B+13% QoQ
EPS$2.86+20% QoQ
6 grounded callouts
What matters now
The highest-signal changes from the call.
Demand
2027 expected to be another record industry year
AI
Agentic AI adds incremental DRAM and NAND demand
Show 3 more callouts
Market Mix
Growth concentrated in Applied's strongest WFE segments
Services
Services growth target raised to mid-teens
Margins
New product value gives pricing power and margin upside
Reported period
Actuals
| Metric | Reported | Change |
|---|---|---|
| AGS Revenue | $1.67B | Reported |
| SEMICONDUCTOR_SYSTEMS Revenue | $5.97B | Reported |
| Revenue | $7.91B | +13% QoQ |
| EPS | $2.86 | +20% QoQ |
| Gross margin | 49.9% | Reported |
| Operating margin | 31.9% | Reported |
Forward-looking
Forward guidance
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| EPS | FY2026 Q3 | $3.16–$3.56Above consensus | $3.36 | Guided |
| Gross margin | FY2026 Q3 | 50.1% | 50.1% | Guided |
| Revenue | FY2026 Q3 | $8.7B–$9.2BAbove consensus | $8.95B | Guided |
AI, capex & demand read
Management read
Upbeat
Management was consistently confident and growth-oriented, citing record results, unprecedented customer visibility, and a strong multi-year outlook.
Management AI read
Management characterized AI as the central secular demand driver, with adoption accelerating and diversifying into agentic workloads that add DRAM/NAND and wafer-fab-equipment demand. Applied is positioning itself to monetize this through leadership in leading-edge logic, DRAM, high-bandwidth memory and advanced packaging, plus AI-enabled services across 35,000 connected chambers.
Investment and capacity
Management is increasing capacity investment to meet stronger, longer customer forecasts: it has nearly doubled manufacturing capacity, expanded in the U.S. and Europe, added a Singapore center, and is building inventory and supplier visibility. This is framed as supporting sustained multi-year growth, including another record 2027.
all 7 named companies below
Companiesreturns since call
Partners
Partners
Gary Dickerson
TSMC is a founding partner in AMAT's EPIC platform, indicating deep co-development ties and likely early access to AMAT's next-gen tools.
Evidence
“Earlier this week, we announced our EPIC co-development engagement with TSMC, who joined as a founding partner together with Micron, Samsung, and SK Hynix.”
Partners
Gary Dickerson
The development partnership with Advantest indicates collaboration on integrated test and process solutions for advanced packaging.
Evidence
“as well as a development partner agreement with Advantest.”
Supply chain
Supply chain
Bryce Hill
AMAT stated 2027 will be another strong record year for the industry, with a similar growth profile for leading-edge logic, DRAM, and advanced packaging. — This is a strong secular growth signal for the entire WFE supply chain, suggesting investment cycles may be longer than a single up-year.
Evidence
“And based on our latest discussions with them, we expect 2027 will be another strong record year for the industry.”
External signals
Supply-chain alpha · 3returns since call
AMAT is using a rolling 8-quarter customer forecast to align its supply chain, implying very strong ordering visibility and a potential buffer against near-term demand shifts.
Evidence
“Our largest customers are providing rolling eight-quarter forecasts so we can prepare the required manufacturing capacity and service resources for their ramps.”
AMAT said customers found ways to reallocate or create clean room space, leading to incremental equipment delivery requests for 2026.
Evidence
“As customers find new ways to reallocate or create space, we are seeing incremental requests for equipment deliveries in 2026”
AMAT stated 2027 will be another strong record year for the industry, with a similar growth profile for leading-edge logic, DRAM, and advanced packaging.
Methodology & coverage
Management-only analysis. All 7 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.