Is the business good?
How good a business is AMAT?
Applied Materials earns 30% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
30%
Return on invested capital · cost of capital 9.0% · 21 points above what the capital costs: growth creates value
- Operating margin
- 30%
Operating margin · Semiconductor Equipment & Materials median 8.4% · 12 months to Q3 2026
- Cash conversion
- 0.61×
Cash conversion · 0.85× a year ago · some of the reported profit has not turned into cash yet
- Share count, year on year
- −0.25%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2020 | 25% |
| FY2021 | 30% |
| FY2022 | 30% |
| FY2023 | 29% |
| FY2024 | 29% |
| FY2025 | 29% |
Details›
- Gross margin12 months to Q3 2026
- 49%
- Operating margin12 months to Q3 2026
- 30%
- Net margin12 months to Q3 2026
- 30%
- Free cash flow margin
- 18%
- R&D as % of revenue
- 13%
- Revenue, trailing twelve months
- $30.8B
- Free cash flow, trailing twelve months
- $5.62B
- Net income, trailing twelve months
- $9.27B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 30%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Semiconductor Equipment & Materials
Ranks #10 of 22 by Smart Score