Applied Materials Announces Second Quarter Results
Applied Materials17 hours ago
- Orders of $2.63 billion, up 16 percent year over year.
- Net sales of $2.35 billion, up 19 percent year over year led by growth in the Silicon Systems Group.
- Non-GAAP adjusted operating income of $482 million, up 69 percent year over year. GAAP operating income of $387 million.
- Non-GAAP adjusted diluted EPS of $0.28, up 75 percent year over year. GAAP diluted EPS of $0.21.
SANTA CLARA, Calif., May 15, 2014 - Applied Materials, Inc. ( AMAT), the global leader in precision materials engineering solutions for the semiconductor, display and solar industries, today reported results for its second quarter of fiscal 2014 ended April 27, 2014.
Applied generated orders of $2.63 billion, up 15 percent from the prior quarter led by increases in Display and Silicon Systems. Net sales of $2.35 billion were up 7 percent sequentially led by growth in Silicon Systems. Non-GAAP adjusted gross margin increased 170 basis points from the prior quarter to 44.2 percent. Non-GAAP adjusted operating income grew 27 percent sequentially to $482 million or 20.5 percent of net sales. Non-GAAP adjusted net income grew 25 percent sequentially to $348 million or $0.28 per diluted share. The company recorded GAAP gross margin of 42.5 percent, operating income of $387 million or 16.4 percent of net sales, and net income of $262 million or $0.21 per diluted share.
"Applied gained 1.4 points of wafer fab equipment market share in 2013 as we enabled major technology inflections for our customers with our unique capabilities in precision materials engineering," said Gary Dickerson, president and CEO. "We are also delivering significant improvements in our financial performance and have expanded our operating margins to their highest level in nearly three years."
Quarterly Results Summary
| GAAP Results | | Q2 FY2014 | | Q1 FY2014 | | Q2 FY2013 | | Net sales | | $2.35 billion | | $2.19 billion | | $1.97 billion | | Operating income (loss) | | $387 million | | $330 million | | $(68) million | | Net income (loss) | | $262 million | | $253 million | | $(129) million | | Diluted earnings (loss) per share (EPS) | | $0.21 | | $0.21 | | $(0.11) | | Non-GAAP Adjusted Results | | | | | | | | Non-GAAP adjusted operating income | | $482 million | | $380 million | | $285 million | | Non-GAAP adjusted net income | | $348 million | | $279 million | | $199 million | | Non-GAAP adjusted diluted EPS | | $0.28 | | $0.23 | | $0.16 |
Applied`s non-GAAP adjusted results exclude the impact of the following, where applicable: certain acquisition-related costs; restructuring charges and any associated adjustments; impairments of assets, goodwill, or investments; gain or loss on sale of strategic investments; and certain 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.
Second Quarter Reportable Segment Results and Comparisons to the Prior Quarter
Silicon Systems Group (SSG) orders were $1.66 billion, up 6 percent, with increases in DRAM and logic/other more than offsetting declines in foundry and flash. Net sales increased 7 percent to $1.58 billion. Non-GAAP adjusted operating income increased to $433 million or 27.3 percent of net sales. GAAP operating income increased to $391 million or 24.7 percent of net sales. New order composition was: foundry 50 percent; flash 21 percent; DRAM 17 percent; and logic/other 12 percent.
Applied Global Services (AGS) orders were $537 million, down 10 percent, primarily due to service contract renewals being seasonally higher in the first quarter. Net sales of $534 million were up 5 percent. Non-GAAP adjusted operating income increased to $150 million or 28.1 percent of net sales. GAAP operating income increased to $148 million or 27.7 percent of net sales.
Display orders of $340 million rose from $79 million in the prior quarter, primarily reflecting orders for TV production capacity. Net sales declined 8 percent to $147 million. Operating income was $26 million or 17.7 percent of net sales both on a GAAP and non-GAAP adjusted basis.
Energy and Environmental Solutions (EES) orders grew to $88 million and net sales rose to $88 million. EES had a non-GAAP adjusted operating income of $7 million or 8 percent of net sales and GAAP operating income of $5 million or 6 percent of net sales.
Backlog grew 12 percent sequentially to $2.74 billion including positive adjustments of $23 million, primarily related to EES re-bookings. Backlog composition by segment was: SSG 53 percent; AGS 24 percent; Display 17 percent; and EES 6 percent.
Second quarter gross margin included the benefit of non-recurring items equivalent to approximately 50 basis points of company gross margin.
Business Outlook
For the third quarter of fiscal 2014, Applied expects net sales to be in the range of flat to down 5 percent from the previous quarter and up by approximately 13 percent to 19 percent from the year-ago period. Non-GAAP adjusted diluted EPS is expected to be in the range of $0.25 to $0.29 and up by approximately 39 percent to 61 percent year over year.
This outlook excludes known charges related to completed acquisitions and integration costs of $0.03 per share. The outlook does not exclude other non-GAAP adjustments that may arise subsequent to this release.
More finance.yahoo.com |
