Slide 1: Third Quarter of Fiscal 2020 Earnings Presentation
Third Quarter of Fiscal 2020 Earnings Presentation AUGUST 13, 2020 Applied Materials External
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements, including those regarding anticipated growth and trends in our businesses and markets, industry outlooks and demand drivers, technology transitions, our business and financial performance and market share positions, ou
Slide 3: Applied Materials At-A-Glance
APPLIED MATERIALS AT-A-GLANCE REPORTING SEGMENTS FOUNDED Semiconductor Systems CURRENT FISCAL 1967 YEAR ENDS FIRST PUBLIC Applied Global Services 25 October 2020 OFFERING Display and Adjacent Markets 1974 $2.2 billion ~23,600** $16.3 billion ~13,300* TTM R&D employees TTM REVENUE INVESTMENTS active
Slide 4: Strong Market and Business Outlook
3rd Fiscal Quarter Near-term / Year Longer-term Operating at pre-COVID Semi demand is Mindful of potential productivity levels in R&D strengthening with macro-economic and manufacturing customers committed to headwinds ramping fabs and driving Double-digit Y/Y growth in R&D roadmaps Digitization acc
Slide 5: COVID-19 Guiding Principles and Response
COVID-19 GUIDING PRINCIPLES 1. Maintain trust of employees, customers, suppliers and partners RESPONSE 2. Drive actions that allow us to emerge stronger over the long term Q3F20 STATUS ▪ Stringent protocols in place to keep workplaces safe and healthy ▪ Recovered pre-COVID productivity levels in R&D
Slide 6: PPACt
ENABLED BY PERFORMANCE New architectures New structures / 3D PPACt New materials New ways to shrink POWER AREA-COST Advanced packaging Applied has broadest portfolio of products and technologies to accelerate new PPACt playbook (PPACt = Power, Performance, Area-cost and Time-to-market) 6 | Applied M
Slide 7: Q3F20 Non-GAAP Financial Results
Q3F20 Non-GAAP Financial Results $M, except EPS Q3F19 Q2F20 Q3F20 Y/Y Q/Q Revenue 3,562 3,957 4,395 23% 11% Gross Margin* 44.0% 44.6% 45.0% 100bps 40bps Operating Income* 820 976 1,160 340 184 EPS* $0.74 $0.89 $1.06 $0.32 $0.17 Operating Cash Flow 787 635 867 80 232 Free Cash Flow** 694 564 780 86 2
Slide 8: Q3F20 Segment Results
Q3F20 Segment Results | Double-digit Y/Y revenue growth in all segments SEMICONDUCTOR SYSTEMS APPLIED GLOBAL SERVICES DISPLAY & ADJACENT MARKETS 33% 34% 28% 28% 28% 31% 27% Non-GAAP Operating Margin* Non-GAAP Operating Margin* Non-GAAP Operating Margin* 26% 22% 21% 21% 28% 28% 2,916 2,814 2,567 1,03
Slide 9: Liquidity and Uses of Capital
Liquidity and Uses of Capital CASH AND INVESTMENTS ($M) Q3F19 Q4F19 Q1F20 Q2F20 Q3F20 Cash and cash equivalents* 3,014 3,129 3,424 5,281 4,350 Short-term investments 547 489 536 423 406 Long-term investments 1,650 1,703 1,713 1,678 1,538 Total cash and investments 5,211 5,321 5,673 7,382 6,294 Short
Slide 10: Business Outlook
Business Outlook FOURTH OUTLOOK Total Revenue ~$4.6 billion ± $0.2 billion QUARTER Non-GAAP EPS ~$1.17 ± $0.06 Fiscal 2020 SEGMENT Semiconductor Systems ~$3.025 billion REVENUE Applied Global Services ~$1.07 billion Display and Adjacent Markets ~$475 million OTHER Non-GAAP Gross Margin ~45.7% Non-GA
Slide 11: Use of Non-GAAP Adjusted Financial Measures
Use of Non-GAAP Adjusted Financial Measures Applied provides investors with certain non-GAAP adjusted financial measures, which are adjusted for the impact of certain costs, expenses, gains and losses, including certain items related to mergers and acquisitions; restructuring charges and any associa
Slide 12: Appendix: Non-GAAP to GAAP Reconciliations
Appendix Non-GAAP to GAAP Reconciliations 12 | Applied Materials External
Slide 13: Unaudited Reconciliation of GAAP to Non-GAAP Adjusted Results
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS IN MILLIONS, EXCEPT EPS AND PERCENTAGE Q3F19 Q4F19 Q1F20 Q2F20 Q3F20 Non-GAAP Adjusted Gross Profit Reported gross profit - GAAP basis $ 1,557 $ 1,634 $ 1,858 $ 1,749 $ 1,955 Certain items associated with acquisitions 1 9 9 9 8 8 Certain
Slide 14: Unaudited Reconciliation of GAAP to Non-GAAP Segment Operating Results
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP SEGMENT OPERATING RESULTS IN MILLIONS, EXCEPT PERCENTAGE Q3F19 Q4F19 Q1F20 Q2F20 Q3F20 Semiconductor Systems Non-GAAP Adjusted Operating Income Reported operating income - GAAP basis $ 613 $ 641 $ 915 $ 782 $ 958 Certain items associated with acquisitions
Slide 15: Cll arenas.
Cll arenas. make possible