Applied Materials Guides $7.65B Q2 Revenue and 49.3% Gross Margin
Applied Materials reported Q1 revenue of $7.0B, down 2% year-on-year, and beat adjusted EPS and revenue estimates, prompting Bank of America to raise its price target following CEO Gary Dickerson’s outlook. Dickerson forecasted over 20% growth in semiconductor equipment for 2026, with momentum carrying into 2027.
1. Q1 Earnings Beat
Applied Materials reported Q1 revenue of $7.0 billion, a 2% year-on-year decline, but exceeded adjusted EPS and revenue estimates.
2. Robust Q2 Guidance
Management guided Q2 revenue at $7.65 billion ±$500 million, non-GAAP EPS of $2.64 ±$0.20 and gross margin near 49.3%, all above Wall Street consensus of $7.03 billion revenue, $2.29 EPS and 48.5% margin.
3. Positive Outlook and Analyst Revisions
CEO Gary Dickerson forecasted over 20% growth in semiconductor equipment for 2026, with momentum carrying into 2027 based on customer cleanroom availability and long-term visibility. Bank of America raised its price target and boosted 2026 and 2027 non-GAAP EPS estimates by 18% to $11.86 and 24% to $14.57.