- Applied delivers in line
results and expects sequential growth in net sales and non-GAAP
EPS
- Company returns $740 million to
shareholders through dividends and share repurchases
SANTA CLARA, Calif., Feb. 18, 2016 - Applied
Materials, Inc. (NASDAQ:AMAT), the global leader in materials
engineering solutions for the semiconductor, display and solar
industries, today reported results for its first quarter ended
January 31, 2016.
First quarter orders were $2.28
billion, down 6 percent sequentially and flat year over year. Net
sales were $2.26 billion, down 5 percent sequentially and down 4
percent year over year.
On a non-GAAP adjusted basis, the company reported
first quarter gross margin of 42.4 percent, operating margin of
17.8 percent, and net income of $302 million or $0.26 per diluted
share. The company recorded GAAP gross margin of 40.6 percent,
operating margin of 15.7 percent, and net income of $286 million or
$0.25 per diluted share.
The company generated $207 million in cash from
operations during the first quarter, paid dividends of $115 million
and used $625 million to repurchase 35 million shares of common
stock.
"As the market moves into the sweet spot for
Applied's materials engineering technology, we see strong demand
for our semiconductor, display and service businesses," said Gary
Dickerson, president and CEO. "We are maintaining a positive
outlook for 2016 as our customers make strategic, inflection-driven
investments that play to our strengths."
Quarterly Results Summary
|
|
|
|
|
|
|
|
Change |
|
|
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
|
Q1 FY2016
vs.
Q4 FY2015 |
|
Q1 FY2016
vs.
Q1 FY2015 |
|
|
(In millions,
except per share amounts and percentages) |
New
orders |
|
$2,275 |
|
$2,424 |
|
$2,273 |
|
(6)% |
|
-% |
Net
sales |
|
$2,257 |
|
$2,368 |
|
$2,359 |
|
(5)% |
|
(4)% |
Gross
margin |
|
40.6% |
|
40.5% |
|
40.7% |
|
0.1 points |
|
(0.1) points |
Operating
margin |
|
15.7% |
|
17.9% |
|
19.4% |
|
(2.2) points |
|
(3.7) points |
Net
income |
|
$286 |
|
$336 |
|
$348 |
|
(15)% |
|
(18)% |
Diluted
earnings per share (EPS) |
|
$0.25 |
|
$0.28 |
|
$0.28 |
|
(11)% |
|
(11)% |
|
|
|
|
|
|
|
|
Change |
Non-GAAP Adjusted Results |
|
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
|
Q1 FY2016
vs.
Q4 FY2015 |
|
Q1 FY2016
vs.
Q1 FY2015 |
|
|
(In millions,
except per share amounts and percentages) |
Non-GAAP
adjusted gross margin |
|
42.4% |
|
42.2% |
|
42.3% |
|
0.2 points |
|
0.1 points |
Non-GAAP
adjusted operating margin |
|
17.8% |
|
19.3% |
|
18.9% |
|
(1.5) points |
|
(1.1) points |
Non-GAAP
adjusted net income |
|
$302 |
|
$347 |
|
$338 |
|
(13)% |
|
(11)% |
Non-GAAP
adjusted diluted EPS |
|
$0.26 |
|
$0.29 |
|
$0.27 |
|
(10)% |
|
(4)% |
Applied's non-GAAP adjusted results exclude the
impact of the following, where applicable: certain items related to
mergers and acquisitions; restructuring charges and any associated
adjustments; impairments of assets, or investments; gain or loss on
sale of strategic investments; and certain discrete adjustments and
tax items. A reconciliation of the GAAP and non-GAAP adjusted
results is provided in the financial tables included in this
release. See also "Use of Non-GAAP Adjusted Financial Measures"
section.
Business Outlook
For the second quarter of fiscal 2016, Applied
expects net sales to be up 5 percent to 10 percent sequentially.
Non-GAAP adjusted diluted EPS is expected to be in the range of
$0.30 to $0.34.
This outlook excludes known charges related to
completed acquisitions of $0.04 per share and does not exclude
other non-GAAP adjustments that may arise subsequent to this
release.
First Quarter Reportable Segment
Information
Silicon Systems |
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
|
|
|
|
|
|
|
(In millions,
except percentages) |
New
orders |
$ |
1,275 |
|
|
$ |
1,444 |
|
|
$ |
1,426 |
|
Foundry |
38 |
% |
|
35 |
% |
|
34 |
% |
DRAM |
29 |
% |
|
21 |
% |
|
34 |
% |
Flash |
22 |
% |
|
31 |
% |
|
18 |
% |
Logic and
other |
11 |
% |
|
13 |
% |
|
14 |
% |
Net
sales |
1,373 |
|
|
1,494 |
|
|
1,446 |
|
Operating
income |
265 |
|
|
318 |
|
|
307 |
|
Operating
margin |
19.3 |
% |
|
21.3 |
% |
|
21.2 |
% |
Non-GAAP Adjusted Results |
|
|
|
|
Non-GAAP
adjusted operating income |
$ |
312 |
|
|
$ |
365 |
|
|
$ |
350 |
|
Non-GAAP
adjusted operating margin |
22.7 |
% |
|
24.4 |
% |
|
24.2 |
% |
Applied Global
Services |
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
|
|
|
|
|
|
|
(In millions,
except percentages) |
New
orders |
$ |
773 |
|
|
$ |
761 |
|
|
$ |
690 |
|
Net
sales |
626 |
|
|
637 |
|
|
583 |
|
Operating
income |
156 |
|
|
171 |
|
|
153 |
|
Operating
margin |
24.9 |
% |
|
26.8 |
% |
|
26.2 |
% |
Non-GAAP Adjusted Results |
|
|
|
|
Non-GAAP
adjusted operating income |
$ |
156 |
|
|
$ |
170 |
|
|
$ |
154 |
|
Non-GAAP
adjusted operating margin |
24.9 |
% |
|
26.7 |
% |
|
26.4 |
% |
Display |
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
|
|
|
|
|
|
|
(In millions,
except percentages) |
New
orders |
$ |
183 |
|
|
$ |
195 |
|
|
$ |
107 |
|
Net
sales |
213 |
|
|
191 |
|
|
275 |
|
Operating
income |
38 |
|
|
19 |
|
|
72 |
|
Operating
margin |
17.8 |
% |
|
9.9 |
% |
|
26.2 |
% |
Non-GAAP Adjusted Results |
|
|
|
|
Non-GAAP
adjusted operating income |
$ |
38 |
|
|
$ |
19 |
|
|
$ |
73 |
|
Non-GAAP
adjusted operating margin |
17.8 |
% |
|
9.9 |
% |
|
26.5 |
% |
Energy and Environmental
Solutions |
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
|
|
|
|
|
|
|
(In millions,
except percentages) |
New
orders |
$ |
44 |
|
|
$ |
24 |
|
|
$ |
50 |
|
Net
sales |
45 |
|
|
46 |
|
|
55 |
|
Operating
income (loss) |
6 |
|
|
- |
|
|
(4 |
) |
Operating
margin |
13.3 |
% |
|
- |
% |
|
(7.3 |
)% |
Non-GAAP Adjusted Results |
|
|
|
|
Non-GAAP
adjusted operating income (loss) |
$ |
4 |
|
|
$ |
(1 |
) |
|
$ |
(3 |
) |
Non-GAAP
adjusted operating margin |
8.9 |
% |
|
(2.2 |
)% |
|
(5.5 |
)% |
Backlog Information
Applied's backlog decreased 1% to
$3.11 billion and included negative adjustments of $51 million.
Backlog composition by reportable segment was as follows:
Silicon
Systems |
51 |
% |
Applied
Global Services |
30 |
% |
Display |
16 |
% |
Energy
and Environmental Solutions |
3 |
% |
Use of Non-GAAP Adjusted
Financial Measures
Management uses non-GAAP adjusted results to
evaluate the company's operating and financial performance in light
of business objectives and for planning purposes. These measures
are not in accordance with GAAP and may differ from non-GAAP
methods of accounting and reporting used by other companies.
Applied believes these measures enhance investors' ability to
review the company's business from the same perspective as the
company's management and facilitate comparisons of this period's
results with prior periods. The presentation of this additional
information should not be considered a substitute for results
prepared in accordance with GAAP.
Webcast Information
Applied Materials will discuss these results
during an earnings call that begins at 1:30 p.m. Pacific Time
today. A live webcast will be available at
www.appliedmaterials.com. A replay will be available on the website
beginning at 5:00 p.m. Pacific Time today.
Forward-Looking
Statements
This press release contains forward-looking
statements, including those regarding anticipated growth and trends
in our businesses and markets, industry outlooks, technology
transitions, our financial performance and market share positions,
our business outlook for the second quarter of fiscal 2016, and
other statements that are not historical facts. These statements
and their underlying assumptions are subject to risks and
uncertainties and are not guarantees of future performance. Factors
that could cause actual results to differ materially from those
expressed or implied by such statements include, without
limitation: the level of demand for our products; global economic
and industry conditions; consumer demand for electronic products;
the demand for semiconductors; customers' technology and capacity
requirements; the introduction of new and innovative technologies,
and the timing of technology transitions; our ability to develop,
deliver and support new products and technologies; the concentrated
nature of our customer base; our ability to expand our
current markets, increase market share and develop new markets;
market acceptance of existing and newly developed products; our
ability to obtain and protect intellectual property rights in key
technologies; our ability to achieve the objectives of operational
and strategic initiatives, align our resources and cost structure
with business conditions, and attract, motivate and retain key
employees; the variability of operating expenses and results among
products and segments, and our ability to accurately forecast
future results, market conditions, customer requirements and
business needs; and other risks and uncertainties described in our
SEC filings, including our most recent Forms 10-K and 8-K. All
forward-looking statements are based on management's current
estimates, projections and assumptions, and we assume no obligation
to update them.
About Applied Materials
Applied Materials, Inc. (Nasdaq:AMAT) is the
global leader in materials engineering solutions for the
semiconductor, flat panel display and solar photovoltaic
industries. Our technologies help make innovations like
smartphones, flat screen TVs and solar panels more affordable and
accessible to consumers and businesses around the world. Learn more
at www.appliedmaterials.com.
Contact:
Kevin Winston (editorial/media)
408.235.4498
Michael Sullivan (financial community) 408.986.7977
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
|
|
Three Months Ended |
(In millions, except per share amounts) |
|
January 31,
2016 |
|
October 25,
2015 |
|
January 25,
2015 |
Net
sales |
|
$ |
2,257 |
|
|
$ |
2,368 |
|
|
$ |
2,359 |
|
Cost of
products sold |
|
1,341 |
|
|
1,409 |
|
|
1,400 |
|
Gross
profit |
|
916 |
|
|
959 |
|
|
959 |
|
Operating
expenses: |
|
|
|
|
|
|
Research,
development and engineering |
|
374 |
|
|
363 |
|
|
351 |
|
Marketing
and selling |
|
106 |
|
|
96 |
|
|
111 |
|
General
and administrative |
|
82 |
|
|
77 |
|
|
117 |
|
Gain on
derivatives associated with terminated business combination |
|
- |
|
|
- |
|
|
(78 |
) |
Total
operating expenses |
|
562 |
|
|
536 |
|
|
501 |
|
Income
from operations |
|
354 |
|
|
423 |
|
|
458 |
|
Interest
expense |
|
42 |
|
|
32 |
|
|
23 |
|
Interest
income and other income, net |
|
2 |
|
|
6 |
|
|
2 |
|
Income
before income taxes |
|
314 |
|
|
397 |
|
|
437 |
|
Provision
for income taxes |
|
28 |
|
|
61 |
|
|
89 |
|
Net
income |
|
$ |
286 |
|
|
$ |
336 |
|
|
$ |
348 |
|
Earnings
per share: |
|
|
|
|
|
|
Basic and
diluted |
|
$ |
0.25 |
|
|
$ |
0.28 |
|
|
$ |
0.28 |
|
Weighted
average number of shares: |
|
|
|
|
|
|
Basic |
|
1,146 |
|
|
1,182 |
|
|
1,224 |
|
Diluted |
|
1,154 |
|
|
1,190 |
|
|
1,240 |
|
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
(In millions) |
|
January 31,
2016 |
|
October 25,
2015 |
ASSETS |
|
|
|
|
Current
assets: |
|
|
|
|
Cash and
cash equivalents |
|
$ |
2,962 |
|
|
$ |
4,797 |
|
Short-term investments |
|
154 |
|
|
168 |
|
Accounts
receivable, net |
|
1,625 |
|
|
1,739 |
|
Inventories |
|
1,835 |
|
|
1,833 |
|
Other
current assets |
|
334 |
|
|
724 |
|
Total
current assets |
|
6,910 |
|
|
9,261 |
|
Long-term
investments |
|
996 |
|
|
946 |
|
Property,
plant and equipment, net |
|
908 |
|
|
892 |
|
Goodwill |
|
3,302 |
|
|
3,302 |
|
Purchased
technology and other intangible assets, net |
|
714 |
|
|
762 |
|
Deferred
income taxes and other assets |
|
496 |
|
|
145 |
|
Total
assets |
|
$ |
13,326 |
|
|
$ |
15,308 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Short-term debt |
|
$ |
- |
|
|
$ |
1,200 |
|
Accounts
payable and accrued expenses |
|
1,457 |
|
|
1,833 |
|
Customer
deposits and deferred revenue |
|
850 |
|
|
765 |
|
Total
current liabilities |
|
2,307 |
|
|
3,798 |
|
Long-term
debt |
|
3,343 |
|
|
3,342 |
|
Other
liabilities |
|
508 |
|
|
555 |
|
Total
liabilities |
|
6,158 |
|
|
7,695 |
|
Total
stockholders' equity |
|
7,168 |
|
|
7,613 |
|
Total
liabilities and stockholders' equity |
|
$ |
13,326 |
|
|
$ |
15,308 |
|
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In millions) |
Three Months Ended |
January 31,
2016 |
|
October 25,
2015 |
|
January 25,
2015 |
Cash
flows from operating activities: |
|
|
|
|
|
Net
income |
$ |
286 |
|
|
$ |
336 |
|
|
$ |
348 |
|
Adjustments required to reconcile net income to cash provided by
operating activities: |
|
|
|
|
|
Depreciation and amortization |
96 |
|
|
96 |
|
|
92 |
|
Share-based compensation |
54 |
|
|
46 |
|
|
48 |
|
Excess
tax benefits from share-based compensation |
(10 |
) |
|
(2 |
) |
|
(39 |
) |
Deferred
income taxes |
15 |
|
|
(159 |
) |
|
28 |
|
Other |
10 |
|
|
(11 |
) |
|
8 |
|
Net
change in operating assets and liabilities |
(244 |
) |
|
165 |
|
|
(425 |
) |
Cash
provided by operating activities |
207 |
|
|
471 |
|
|
60 |
|
Cash
flows from investing activities: |
|
|
|
|
|
Capital
expenditures |
(68 |
) |
|
(55 |
) |
|
(49 |
) |
Proceeds
from sales and maturities of investments |
241 |
|
|
200 |
|
|
140 |
|
Purchases
of investments |
(282 |
) |
|
(202 |
) |
|
(141 |
) |
Cash used
in investing activities |
(109 |
) |
|
(57 |
) |
|
(50 |
) |
Cash
flows from financing activities: |
|
|
|
|
|
Debt
borrowings (repayments), net of issuance costs |
(1,205 |
) |
|
2,581 |
|
|
- |
|
Proceeds
from common stock issuances and others, net |
2 |
|
|
45 |
|
|
- |
|
Common
stock repurchases |
(625 |
) |
|
(700 |
) |
|
- |
|
Excess
tax benefits from share-based compensation |
10 |
|
|
2 |
|
|
39 |
|
Payments
of dividends to stockholders |
(115 |
) |
|
(119 |
) |
|
(122 |
) |
Cash
provided by (used in) financing activities |
(1,933 |
) |
|
1,809 |
|
|
(83 |
) |
Increase
(decrease) in cash and cash equivalents |
(1,835 |
) |
|
2,223 |
|
|
(73 |
) |
Cash and
cash equivalents - beginning of period |
4,797 |
|
|
2,574 |
|
|
3,002 |
|
Cash and
cash equivalents - end of period |
$ |
2,962 |
|
|
$ |
4,797 |
|
|
$ |
2,929 |
|
Supplemental cash flow information: |
|
|
|
|
|
Cash
payments for income taxes |
$ |
44 |
|
|
$ |
149 |
|
|
$ |
89 |
|
Cash
refunds from income taxes |
$ |
5 |
|
|
$ |
2 |
|
|
$ |
3 |
|
Cash
payments for interest |
$ |
34 |
|
|
$ |
7 |
|
|
$ |
39 |
|
APPLIED MATERIALS, INC.
UNAUDITED SUPPLEMENTAL INFORMATION
Corporate Unallocated
Expenses
(In millions) |
|
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
Share-based compensation |
|
$ |
54 |
|
|
$ |
46 |
|
|
$ |
48 |
|
Certain items associated with terminated business combination |
|
- |
|
|
- |
|
|
20 |
|
Gain
on derivatives associated with terminated business combination,
net |
|
- |
|
|
- |
|
|
(78 |
) |
Other
unallocated expenses |
|
57 |
|
|
39 |
|
|
80 |
|
Total
corporate |
|
$ |
111 |
|
|
$ |
85 |
|
|
$ |
70 |
|
Additional Information
|
|
Q1 FY2016 |
|
Q4 FY2015 |
|
Q1 FY2015 |
New
Orders and Net Sales by Geography |
|
|
|
|
|
|
|
|
|
|
|
|
(In $ millions) |
|
New
Orders |
|
Net
Sales |
|
New
Orders |
|
Net
Sales |
|
New
Orders |
|
Net
Sales |
United
States |
|
369 |
|
|
293 |
|
|
282 |
|
|
301 |
|
|
411 |
|
|
369 |
|
% of
Total |
|
16 |
% |
|
13 |
% |
|
12 |
% |
|
13 |
% |
|
18 |
% |
|
16 |
% |
Europe |
|
156 |
|
|
138 |
|
|
155 |
|
|
172 |
|
|
148 |
|
|
153 |
|
% of
Total |
|
7 |
% |
|
6 |
% |
|
6 |
% |
|
7 |
% |
|
6 |
% |
|
6 |
% |
Japan |
|
109 |
|
|
334 |
|
|
452 |
|
|
278 |
|
|
242 |
|
|
243 |
|
% of
Total |
|
5 |
% |
|
15 |
% |
|
19 |
% |
|
12 |
% |
|
11 |
% |
|
10 |
% |
Korea |
|
373 |
|
|
268 |
|
|
207 |
|
|
239 |
|
|
546 |
|
|
536 |
|
% of
Total |
|
17 |
% |
|
12 |
% |
|
8 |
% |
|
10 |
% |
|
24 |
% |
|
23 |
% |
Taiwan |
|
574 |
|
|
637 |
|
|
846 |
|
|
758 |
|
|
545 |
|
|
556 |
|
% of
Total |
|
25 |
% |
|
28 |
% |
|
35 |
% |
|
32 |
% |
|
24 |
% |
|
24 |
% |
Southeast
Asia |
|
232 |
|
|
90 |
|
|
100 |
|
|
143 |
|
|
85 |
|
|
92 |
|
% of
Total |
|
10 |
% |
|
4 |
% |
|
4 |
% |
|
6 |
% |
|
4 |
% |
|
4 |
% |
China |
|
462 |
|
|
497 |
|
|
382 |
|
|
477 |
|
|
296 |
|
|
410 |
|
% of
Total |
|
20 |
% |
|
22 |
% |
|
16 |
% |
|
20 |
% |
|
13 |
% |
|
17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Employees (In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
Regular
Full Time |
|
14.6 |
|
|
14.6 |
|
|
14.1 |
|
APPLIED MATERIALS,
INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
|
|
Three Months Ended |
(In millions, except percentages) |
|
January 31,
2016 |
|
October 25,
2015 |
|
January 25,
2015 |
Non-GAAP
Adjusted Gross Profit |
|
|
|
|
|
|
Reported
gross profit - GAAP basis |
|
$ |
916 |
|
|
$ |
959 |
|
|
$ |
959 |
|
Certain
items associated with acquisitions1 |
|
42 |
|
|
42 |
|
|
40 |
|
Inventory
charges (reversals) related to restructuring3, 4 |
|
(1 |
) |
|
1 |
|
|
- |
|
Other
significant gains, losses or charges, net5 |
|
- |
|
|
(2 |
) |
|
- |
|
Non-GAAP
adjusted gross profit |
|
$ |
957 |
|
|
$ |
1,000 |
|
|
$ |
999 |
|
Non-GAAP
adjusted gross margin |
|
42.4 |
% |
|
42.2 |
% |
|
42.3 |
% |
Non-GAAP
Adjusted Operating Income |
|
|
|
|
|
|
Reported
operating income - GAAP basis |
|
$ |
354 |
|
|
$ |
423 |
|
|
$ |
458 |
|
Certain
items associated with acquisitions1 |
|
48 |
|
|
47 |
|
|
46 |
|
Acquisition integration costs |
|
- |
|
|
- |
|
|
1 |
|
Gain on
derivatives associated with terminated business combination,
net |
|
- |
|
|
- |
|
|
(78 |
) |
Certain
items associated with terminated business combination2 |
|
- |
|
|
- |
|
|
20 |
|
Reversals
related to restructuring, net3, 4 |
|
(1 |
) |
|
(1 |
) |
|
- |
|
Other
significant gains, losses or charges, net5 |
|
- |
|
|
(13 |
) |
|
- |
|
Non-GAAP
adjusted operating income |
|
$ |
401 |
|
|
$ |
456 |
|
|
$ |
447 |
|
Non-GAAP
adjusted operating margin |
|
17.8 |
% |
|
19.3 |
% |
|
18.9 |
% |
Non-GAAP
Adjusted Net Income |
|
|
|
|
|
|
Reported
net income - GAAP basis |
|
$ |
286 |
|
|
$ |
336 |
|
|
$ |
348 |
|
Certain
items associated with acquisitions1 |
|
48 |
|
|
47 |
|
|
46 |
|
Acquisition integration costs |
|
- |
|
|
- |
|
|
1 |
|
Gain on
derivatives associated with terminated business combination,
net |
|
- |
|
|
- |
|
|
(78 |
) |
Certain
items associated with terminated business combination2 |
|
- |
|
|
- |
|
|
20 |
|
Reversals
related to restructuring, net3, 4 |
|
(1 |
) |
|
(1 |
) |
|
- |
|
Impairment (gain on sale) of strategic investments, net |
|
(2 |
) |
|
(2 |
) |
|
1 |
|
Loss on
early extinguishment of debt |
|
5 |
|
|
- |
|
|
- |
|
Other
significant gains, losses or charges, net5 |
|
- |
|
|
(13 |
) |
|
- |
|
Reinstatement of federal R&D tax credit, resolution of prior
years' income tax filings and other tax items |
|
(29 |
) |
|
(18 |
) |
|
(17 |
) |
Income
tax effect of non-GAAP adjustments |
|
(5 |
) |
|
(2 |
) |
|
17 |
|
Non-GAAP
adjusted net income |
|
$ |
302 |
|
|
$ |
347 |
|
|
$ |
338 |
|
1 |
These items are incremental charges attributable to
completed acquisitions, consisting of amortization of purchased
intangible assets. |
|
|
2 |
These items are incremental charges related to the
terminated business combination agreement with Tokyo Electron
Limited, consisting of acquisition-related and integration planning
costs. |
|
|
3 |
Results for three months ended January 31, 2016
included a $1 million reversal of inventory charges related to cost
reductions in the solar business. |
|
|
4 |
Results for the three months ended October 25, 2015
included a $2 million favorable adjustment of restructuring
reserves related to prior restructuring plans and $1 million of
inventory charges related to cost reductions in the solar
business. |
|
|
5 |
These items are significant gains, losses, or charges
during a period that are the result of isolated events or
transactions which have not occurred frequently in the past and are
not expected to occur regularly or be repeated in the future. |
|
|
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
|
|
Three Months Ended |
(In millions except per share amounts) |
|
January 31,
2016 |
|
October 25,
2015 |
|
January 25,
2015 |
Non-GAAP
Adjusted Earnings Per Diluted Share |
|
|
|
|
|
|
Reported
earnings per diluted share - GAAP basis |
|
$ |
0.25 |
|
|
$ |
0.28 |
|
|
$ |
0.28 |
|
Certain
items associated with acquisitions |
|
0.04 |
|
|
0.04 |
|
|
0.03 |
|
Certain
items associated with terminated business combination |
|
- |
|
|
- |
|
|
0.01 |
|
Gain on
derivatives associated with terminated business combination,
net |
|
- |
|
|
- |
|
|
(0.04 |
) |
Reinstatement of federal R&D tax credit, resolution of prior
years' income tax filings and other tax items |
|
(0.03 |
) |
|
(0.02 |
) |
|
(0.01 |
) |
Other
significant gains, losses or charges, net |
|
- |
|
|
(0.01 |
) |
|
- |
|
Non-GAAP
adjusted earnings per diluted share |
|
$ |
0.26 |
|
|
$ |
0.29 |
|
|
$ |
0.27 |
|
Weighted
average number of diluted shares |
|
1,154 |
|
|
1,190 |
|
|
1,240 |
|
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
|
|
Three Months Ended |
(In millions, except percentages) |
|
January 31,
2016 |
|
October 25,
2015 |
|
January 25,
2015 |
Silicon
Systems Non-GAAP Adjusted Operating Income |
|
|
|
|
|
|
Reported
operating income - GAAP basis |
|
$ |
265 |
|
|
$ |
318 |
|
|
$ |
307 |
|
Certain
items associated with acquisitions1 |
|
47 |
|
|
47 |
|
|
43 |
|
Non-GAAP
adjusted operating income |
|
$ |
312 |
|
|
$ |
365 |
|
|
$ |
350 |
|
Non-GAAP
adjusted operating margin |
|
22.7 |
% |
|
24.4 |
% |
|
24.2 |
% |
AGS
Non-GAAP Adjusted Operating Income |
|
|
|
|
|
|
Reported
operating income - GAAP basis |
|
$ |
156 |
|
|
$ |
171 |
|
|
$ |
153 |
|
Certain
items associated with acquisitions1 |
|
- |
|
|
- |
|
|
1 |
|
Other
significant gains, losses or charges, net4 |
|
- |
|
|
(1 |
) |
|
- |
|
Non-GAAP
adjusted operating income |
|
$ |
156 |
|
|
$ |
170 |
|
|
$ |
154 |
|
Non-GAAP
adjusted operating margin |
|
24.9 |
% |
|
26.7 |
% |
|
26.4 |
% |
Display
Non-GAAP Adjusted Operating Income |
|
|
|
|
|
|
Reported
operating income - GAAP basis |
|
$ |
38 |
|
|
$ |
19 |
|
|
$ |
72 |
|
Certain items associated with acquisitions1 |
|
- |
|
|
- |
|
|
1 |
|
Non-GAAP
adjusted operating income |
|
$ |
38 |
|
|
$ |
19 |
|
|
$ |
73 |
|
Non-GAAP
adjusted operating margin |
|
17.8 |
% |
|
9.9 |
% |
|
26.5 |
% |
EES
Non-GAAP Adjusted Operating Income (Loss) |
|
|
|
|
|
|
Reported
operating income (loss) - GAAP basis |
|
$ |
6 |
|
|
$ |
- |
|
|
$ |
(4 |
) |
Certain
items associated with acquisitions1 |
|
1 |
|
|
- |
|
|
1 |
|
Reversals related to restructuring, net2,3 |
|
(3 |
) |
|
(1 |
) |
|
- |
|
Non-GAAP
adjusted operating income (loss) |
|
$ |
4 |
|
|
$ |
(1 |
) |
|
$ |
(3 |
) |
Non-GAAP
adjusted operating margin |
|
8.9 |
% |
|
(2.2 |
)% |
|
(5.5 |
)% |
1 |
These items are incremental charges attributable to
completed acquisitions, consisting of amortization of purchased
intangible assets. |
|
|
2 |
Results for the three months ended January 31, 2016
included $3 million of favorable adjustment of employee-related
costs and $1 million reversal of inventory charges, partially
offset by $1 million of fixed asset impairment charges related to
cost reductions in the solar business. |
|
|
3 |
Results for the three months ended October 25, 2015
included a $2 million favorable adjustment of restructuring
reserves related to prior restructuring plans and $1 million of
inventory charges related to cost reductions in the solar
business. |
|
|
4 |
These items are significant gains, losses, or charges
during a period that are the result of isolated events or
transactions which have not occurred frequently in the past and are
not expected to occur regularly or be repeated in the future. |
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED OPERATING
EXPENSES
|
Three Months Ended |
(In millions) |
January 31, 2016 |
|
October 25, 2015 |
|
|
|
|
Operating
expenses - GAAP basis |
$ |
562 |
|
|
$ |
536 |
|
Reversals
related to restructuring, net |
- |
|
|
2 |
|
Certain
items associated with acquisitions |
(6 |
) |
|
(5 |
) |
Other
significant gains, losses or charges, net |
- |
|
|
11 |
|
Non-GAAP
adjusted operating expenses |
$ |
556 |
|
|
$ |
544 |
|
UNAUDITED RECONCILIATION OF GAAP TO
NON-GAAP ADJUSTED EFFECTIVE INCOME TAX RATE
|
Three Months Ended |
(In millions, except percentages) |
January 31, 2016 |
|
|
Provision
for income taxes - GAAP basis (a) |
$ |
28 |
|
Reinstatement of federal R&D tax credit, resolutions of prior
years' income tax filings and other tax items |
29 |
|
Income
tax effect of non-GAAP adjustments |
5 |
|
Non-GAAP
adjusted provision for income taxes (b) |
$ |
62 |
|
|
|
Income
before income taxes - GAAP basis (c) |
$ |
314 |
|
Certain
items associated with acquisitions |
48 |
|
Reversals
related to restructuring, net |
(1) |
|
Gain on
sale of strategic investments, net |
(2) |
|
Loss on
early extinguishment of debt |
5 |
|
Non-GAAP
adjusted income before income taxes (d) |
$ |
364 |
|
|
|
Effective
income tax rate - GAAP basis (a/c) |
8.9 |
% |
|
|
Non-GAAP
adjusted effective income tax rate (b/d) |
17.0 |
% |
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Applied Materials via Globenewswire
HUG#1987030
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