# Applied Materials (AMAT) Q2 FY2026 earnings

Results filed 2026-05-14 for the quarter ended 2026-04-26. Source page: https://earnings.opennash.com/companies/amat/2026-q2/
Press release and exhibits: https://www.sec.gov/Archives/edgar/data/6951/000162828026035071/0001628280-26-035071-index.htm
> Summaries and transcripts are machine-generated and can contain errors.

## In brief

Applied Materials reported record revenue of $7.91 billion, up 11 percent year over year, with record GAAP EPS of $3.51 and record non-GAAP EPS of $2.86.

Applied Materials posted record revenue of $7.91 billion in the second quarter of fiscal 2026, up 11 percent from a year ago. GAAP gross margin was 49.9 percent and non-GAAP gross margin was 50.0 percent. GAAP EPS was a record $3.51 and non-GAAP EPS was a record $2.86. Cash from operations was $845 million, and the company returned $765 million to shareholders through buybacks and dividends.
For the third quarter, management expects revenue of $8,950 million, plus or minus $500 million, and non-GAAP EPS of $3.36, plus or minus $0.20. It now expects its semiconductor equipment business to grow more than 30 percent in calendar 2026, driven by AI. The tension is execution: non-GAAP free cash flow fell to $210 million from $1,061 million as inventory and capital spending rose to meet demand.

## Key numbers

| Metric | Value | Change | Basis |
| --- | --- | --- | --- |
| Revenue | $7.91 billion | up 11 percent year over year | GAAP |
| Net income | $2,806 | up 31% from $2,137 a year ago | GAAP |
| Diluted EPS | $3.51 | up 33 percent year over year | GAAP |
| Non-GAAP diluted EPS | $2.86 | up 20 percent year over year | non-GAAP |
| GAAP gross margin | 49.9 percent | up 0.8 points from 49.1% a year ago | GAAP |
| Non-GAAP gross margin | 50.0 percent | up 0.8 points from 49.2% a year ago | non-GAAP |
| GAAP operating income | $2.52 billion |  | GAAP |
| GAAP operating margin | 31.9 percent | up 1.4 points from 30.5% a year ago | GAAP |
| Non-GAAP operating margin | 32.1 percent | up 1.4 points from 30.7% a year ago | non-GAAP |
| Cash from operations | $845 million |  | GAAP |
| Non-GAAP free cash flow | $210 | down 80% from $1,061 a year ago | non-GAAP |

## Segments and operating metrics

| Name | Value | Change |
| --- | --- | --- |
| Semiconductor Systems revenue | $5,965 | vs $5,401 in Q2 FY2025 |
| Applied Global Services revenue | $1,665 | vs $1,420 in Q2 FY2025 |
| Other (including Display) revenue | $280 | vs $279 in Q2 FY2025 |
| Semiconductor Systems operating margin | 35.1% | vs 32.8% in Q2 FY2025 |
| Applied Global Services operating margin | 29.2% | vs 26.6% in Q2 FY2025 |
| Semiconductor Systems DRAM share of revenue | 29% | vs 27% in Q2 FY2025 |

## Outlook

| Metric | Period | Outlook |
| --- | --- | --- |
| Total revenue | third quarter of fiscal 2026 | $8,950 |
| Non-GAAP diluted EPS | third quarter of fiscal 2026 | $3.36 |
| Semiconductor equipment business growth | calendar 2026 | more than 30 percent |

## Key takeaways

1. **Record revenue and EPS on AI demand** Revenue reached $7.91 billion, up 11 percent year over year, with record GAAP EPS of $3.51 and record non-GAAP EPS of $2.86.
2. **Margins expanded across the company** Non-GAAP gross margin was 50.0 percent versus 49.2% a year ago, and non-GAAP operating margin was 32.1 percent versus 30.7%.
3. **Management lifted calendar 2026 equipment outlook** The CEO said the semiconductor equipment business is now expected to grow more than 30 percent in calendar 2026, citing the build-out of AI computing infrastructure.
4. **Third-quarter guidance implies sequential growth** Applied guided to revenue of $8,950 million, plus or minus $500 million, and non-GAAP EPS of $3.36, plus or minus $0.20, against $7,910 million of revenue this quarter.
5. **Free cash flow fell as spending rose** Non-GAAP free cash flow was $210 million versus $1,061 million a year ago, as operating cash flow was $845 million and capital expenditures were $635 million.

## Questions

**What were Applied Materials' main results for Q2 fiscal 2026?** Revenue was a record $7.91 billion, up 11 percent year over year. GAAP EPS was $3.51 and non-GAAP EPS was $2.86, both records.
**What is Applied Materials guiding for the third quarter of fiscal 2026?** Management expects total revenue of $8,950 million, plus or minus $500 million, and non-GAAP diluted EPS of $3.36, plus or minus $0.20.
**How did profitability change from a year ago?** GAAP gross margin rose to 49.9% from 49.1%, and non-GAAP operating margin rose to 32.1% from 30.7%. Both gains were 0.8 and 1.4 points respectively.
**How did the segments perform?** Semiconductor Systems revenue was $5,965 million at a 35.1% operating margin, and Applied Global Services revenue was $1,665 million at 29.2%. Other, which includes Display, had an operating loss of $56 million.
**What happened to cash flow and shareholder returns?** Cash from operations was $845 million and non-GAAP free cash flow was $210 million, down from $1,061 million a year ago. Applied returned $765 million to shareholders and raised its quarterly dividend 15 percent to $0.53 per share.