Applied Materials Ranks 73rd in Trading Volume with $1.08 Billion in Activity

On April 30, 2025, applied materials (AMAT) saw a trading volume of $1.08 billion, ranking 73rd in the day's stock market activity. The company's stock price increased by 0.78%.

Applied Materials, founded in 1967, is the largest provider of semiconductor wafer fabrication equipment. The company's robust profitability and high growth make it a unique asset in the semiconductor industry. Its return on invested capital (ROIC) stands at 47.1%, reflecting management's expertise in identifying profitable investments. The company's operating margin has been impressive, and its operating leverage has amplified profits over the last five years.

In Q4 CY2024, Applied Materials met Wall Street's revenue expectations with sales up 6.8% year on year to $7.17 billion. However, the next quarter's revenue guidance of $7.1 billion was less impressive, coming in 0.8% below analysts' estimates. The company's non-GAAP profit of $2.38 per share was 3.7% above analysts' consensus estimates. The operating margin for the quarter was 30.4%, up from 29.3% in the same quarter last year. The free cash flow margin, however, decreased to 7.6% from 31.3% in the same quarter last year.

Applied Materials's Days Inventory Outstanding (DIO) for the quarter was 136, which is 4 days below its five-year average. This indicates that despite the recent increase, there is no indication of an excessive inventory buildup. The company's gross profit margin for the quarter was 48.8%, marking a 1 percentage point increase from 47.8% in the same quarter last year. This suggests that the company's input costs have been stable and it isn't under pressure to lower prices.

Applied Materials's operating margin for the quarter was 30.4%, up 1 percentage point year on year. This increase was encouraging, and since its operating margin rose more than its gross margin, it can be inferred that the company has been more efficient with expenses such as marketing, R&D, and administrative overhead. The company's EPS for the quarter was $2.38, up from $2.13 in the same quarter last year, beating analysts' estimates by 3.7%.

Ask Aime: "Should I invest in Applied Materials after its strong earnings report?"

Applied Materials has shown robust cash profitability, with a free cash flow margin averaging 25.2% over the last two years. The company's balance sheet is strong, with $8.21 billion of cash and $6.26 billion of debt, giving it the freedom to borrow money, return capital to shareholders, or invest in growth initiatives. The company's ROIC of 46.3% over the last five years places it among the best semiconductor companies, illustrating its management team's ability to invest in highly profitable ventures and produce tangible results for shareholders.