Slide 1: Second Quarter Fiscal 2026 Earnings Presentation
Second Quarter Fiscal 2026 Earnings Presentation May 14, 2026 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: Calendar Announcements
Calendar Announcements JUNE 25 | 9AM PT DRAM and Advanced Packaging Master Class Webcast AUGUST 13 [PROJECTED] Q3 2026 Earnings Call Webcast OCTOBER 12 EPIC Center Unveiling Sunnyvale, CA OCTOBER 13 Investor Breakfast Presentation San Francisco, CA | Webcast 3 | Applied Materials External
Slide 4: Gary Dickerson, President and Chief Executive Officer
Gary Dickerson President and Chief Executive Officer Applied Materials External
Slide 5: CEO Perspective
CEO ▪ FQ2 delivered record revenue, earnings, and highest gross margin in >25 years PERSPECTIVE ▪ Rising demand and increasing long-term customer visibility set strong foundation for multi-year growth ▪ Business momentum fueled by: » Rapid global build-out of AI computing infrastructure » Applied’s
Slide 6: AI Adoption is Accelerating and Diversifying
AI Adoption is Accelerating and Diversifying REAL-WORLD EXAMPLE GLOBAL ADOPTION TRENDS AGENTIC AI GROWTH ▪ >35,000 people in ▪ Improvements in AI ▪ Seeing increase in Applied’s global performance and agentic AI applications workforce using AI: cost delivering compelling returns ▪ Agentic AI models p
Slide 7: AI Driving Higher Growth for Applied Materials
AI Driving Higher Growth for Applied Materials Applied’s Semi Systems Applied has strong process Data center AI equipment leadership business now expected to increasing demand in grow >30% in CY26* Applied’s leadership #1 in leading-edge F/L markets: » GAA nodes grow available Seeing incremental dem
Slide 8: Strengthening the Industry's Broadest Gate-All-Around Portfolio
Strengthening the Industry’s Broadest Gate-All-Around Portfolio GAA TRANSISTOR CONTACT Planarizing Wires Opta CMP Creating Epi Nanosheets Creating Contacts Centura Prime Epi Centris Spectral Feb’26 Molybdenum ALD Recessing SiGe Producer Selectra Etch PROVision 10 eBeam Metrology Recessing Si and Rem
Slide 9: Innovative Pipeline of Next-Generation Products: Q2 Launches
Innovative Pipeline of Next-Generation Products: Q2 Launches GAA GAA Trillium ALD Precision Selective Nitride PECVD Precisely deposits metals in complex GAA Industry-first selective bottom-up transistor gate stacks, providing angstrom- deposition process preserves integrity level thickness control f
Slide 10: Enabling the Panel Packaging Ecosystem
Enabling the Panel Packaging Ecosystem CVD Etch PVD NEXX panel-level ECD technology broadens Applied’s portfolio* Digital Lithography Electrochemical Deposition eBeam Metrology & Test Applied has Industry’s Broadest Portfolio for Emerging Panel Trend *acquisition pending 10 | Applied Materials Exter
Slide 11: Enabling the DRAM Roadmap
Enabling the DRAM Roadmap High Bandwidth Memory 6F² 4F² 3D DRAM Applied’s SAM increases with DRAM and Advanced Packaging each new generation Master Class June 25, 9am PT | Webcast 11 | Applied Materials External
Slide 12: EPIC Center Gaining Momentum
EPIC CENTER GAINING MOMENTUM FOUNDING PARTNERS INNOVATION PARTNERS RESEARCH PARTNERS Micron Samsung Advantest ASU RPI SK hynix TSMC Stanford 12 | Applied Materials External
Slide 13: Service Innovation – Accelerating Time to Market
Service Innovation – Accelerating Time to Market AI IN THE FAB ACCELERATE Results R&D ▪ >35,000 chambers Time to qualify connected to AIx servers x AI Process window using AI-powered monitoring, diagnostics Ramp and analytics Time to match ▪ 30% faster response Actionable Insight Yield optimization
Slide 14: CEO Summary
CEO ▪ AI adoption is accelerating and diversifying, fueling broader demand for semiconductors, manufacturing and equipment SUMMARY ▪ Leading-edge foundry-logic, DRAM and advanced packaging enable higher AI performance per watt » Expect these markets to drive >80% of 2026 WFE market growth, and see a
Slide 15: Brice Hill, SVP, Chief Financial Officer
Brice Hill SVP, Chief Financial Officer Applied Materials External
Slide 16: Demand Environment
▪ AI driving WFE demand to Applied’s areas of strength » Expect positive mix to continue in 2H CY26 and beyond ▪ Delivered double-digit Q/Q and Y/Y growth across revenue, operating profit and EPS ▪ Demand outlook has strengthened DEMAND » Cloud service providers continue to increase capital investme
Slide 17: Strategic Priorities
Strategic Priorities Top priority is increasing output to serve our Manufacturing Cleanroom Floor customers’ growing demand Ricky ▪ Nearly doubled manufacturing capacity: U.S., Europe and Singapore ▪ Increased build plan, inventory and logistics ▪ Providing earlier and longer demand signals to suppl
Slide 18: FQ2'26 Non-GAAP Financial Results
FQ2’26 Non-GAAP Financial Results Year-over-year highlights: $M, except EPS FQ2’25 FQ1’26 FQ2’26 YoY QoQ ▪ Record revenue in Semi Revenue 7,100 7,012 7,910 11% 13% Systems and AGS ▪ Gross margin reached 50%, driven by: Gross Margin* 49.2% 49.1% 50.0% 80bps 90bps » Value-based pricing on most differe
Slide 19: FQ2'26 Segment Results
FQ2’26 Segment Results SEMICONDUCTOR SYSTEMS APPLIED GLOBAL SERVICES Non-GAAP Operating Margin* 35% 33% 33% 33% Non-GAAP Operating Margin* 30% 29% 29% 28% 5,965 27% 27% 5,564 5,401 5,141 4,879 1,665 1,559 1,506 1,463 1,420 Revenue ($M) Revenue ($M) Q2F25 Q3F25 Q4F25 Q1F26 Q2F26 Q2F25 Q3F25 Q4F25 Q1F
Slide 20: Cash Flows and Shareholder Distributions
Cash Flows and Shareholder Distributions CASH FLOWS ($M) FQ2'25 FQ3'25 FQ4'25 FQ1’26 FQ2’26 Operating Cash Flow 1,571 2,634 2,828 1,686 845 Free Cash Flow* 1,061 2,050 2,043 1,040 210 SHAREHOLDER DISTRIBUTIONS ($M) Total Shareholder Distributions (1,995) (1,424) (1,216) (702) (765) Share Repurchases
Slide 21: Business Outlook
Business Outlook Total Revenue ~$8.950B ± $500M Third OUTLOOK* Non-GAAP EPS* ~$3.36 ± $0.20 QUARTER FISCAL 2026 Semiconductor Systems (includes 200mm equipment) ~$6.900B REVENUE Applied Global Services ~$1.750B (excludes 200mm equipment) Other ~$300M Non-GAAP Gross Margin* ~50.1% OTHER Non-GAAP Oper
Slide 22: CFO Summary
▪ AI growth we’ve been investing for is now in full force ▪ WFE mix has shifted to leading-edge foundry-logic, DRAM and advanced packaging where Applied is CFO SUMMARY #1 process equipment supplier ▪ Investing with confidence in R&D and operations to support strong, long-term growth expected by cust
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Slide 24: Segment Financial Table
Segment Financial Table RECAST PREVIOUSLY REPORTED In Millions, Except Percentages FY24 Q1F25 Q2F25 Q3F25 Q4F25 In Millions, Except Percentages FY24 Q1F25 Q2F25 Q3F25 Q4F25 SEMICONDUCTOR SYSTEMS SEMICONDUCTOR SYSTEMS Revenue $ 21,014 $ 5,597 $ 5,401 $ 5,564 $ 4,879 Revenue $ 19,911 $ 5,356 $ 5,255 $
Slide 25: Capital Allocation Strategy
Capital Allocation Strategy 1. Invest in R&D and infrastructure OVER PAST 10 FISCAL YEARS (through FY25) to enable profitable growth » Reinvested nearly $25B in R&D and >$8B in capital additions » Distributed nearly 90% of FCF* 2. Grow dividend per share and use » Grew dividend per share at 16% CAGR
Slide 26: Strong Investment-Grade Balance Sheet
Strong Investment-Grade Balance Sheet CASH AND INVESTMENTS ($M) FQ2'25 FQ3'25 FQ4'25 FQ1'26 FQ2'26 Cash and Cash Equivalents 6,169 5,384 7,241 7,218 6,301 Short-Term Investments 578 1,630 1,332 1,293 1,940 Long-Term Investments 3,638 4,133 4,327 4,968 5,142 Total Cash and Investments 10,385 11,147 1
Slide 27: Latest 3rd Party ESG Ratings
LATEST 3rd PARTY ESG RATINGS CDP Climate B CDP Water A- MSCI AAA Sustainalytics Risk Rating Low ISS (E/S/G) 1/2/1 Link: 2024 Impact Report 27 | Applied Materials External
Slide 28: Additional Resources
Additional Resources Investor Relations Home Page LINK Newsroom LINK 2026: 2026 Logic Master Class LINK 2026: SPIE Advanced Lithography + Patterning Conference LINK 2025: SEMICON West Technology Breakfast LINK 28 | Applied Materials External
Slide 29: Appendix: GAAP to Non-GAAP Reconciliations
Appendix GAAP to Non-GAAP Reconciliations 29 | Applied Materials External
Slide 30: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Applied provides investors with certain non-GAAP financial measures, which are adjusted for the impact of certain costs, expenses, gains and losses, including, as applicable, certain items related to mergers and acquisitions; restructuring and severance charges and
Slide 31: Unaudited Quarterly Reconciliation of GAAP to Non-GAAP Results
UNAUDITED QUARTERLY RECONCILIATION OF GAAP TO NON-GAAP RESULTS IN MILLIONS, EXCEPT PERCENTAGES FQ2’25 FQ3'25 FQ4'25 FQ1'26 FQ2'26 Non-GAAP Gross Profit FOOTNOTES: GAAP reported gross profit $ 3,485 $ 3,562 $ 3,265 $ 3,435 $ 3,947 1. These items are incremental Certain items associated with acquisiti
Slide 32: Unaudited Quarterly Reconciliation of GAAP to Non-GAAP Results
UNAUDITED QUARTERLY RECONCILIATION OF GAAP TO NON-GAAP RESULTS IN MILLIONS, EXCEPT PER SHARE AMOUNTS FQ2'25 FQ3'25 FQ4'25 FQ1'26 FQ2'26 Non-GAAP Earnings Per Diluted Share GAAP reported earnings per diluted share $ 2.63 $ 2.22 $ 2.38 $ 2.54 $ 3.51 Certain items associated with acquisitions 0.01 0.01
Slide 33: Reconciliation of GAAP to Non-GAAP Segment Operating Results
UNAUDITED QUARTERLY RECONCILIATION OF GAAP TO NON-GAAP SEGMENT OPERATING RESULTS IN MILLIONS, EXCEPT PERCENTAGES FQ2'25 FQ3'25 FQ4'25 FQ1'26 FQ2'26 Semiconductor Systems Non-GAAP Gross Profit GAAP reported gross profit $ 2,889 $ 2,970 $ 2,569 $ 2,794 $ 3,264 Certain items associated with acquisition
Slide 34: Reconciliation of GAAP to Non-GAAP Operating Expenses
UNAUDITED QUARTERLY RECONCILIATION OF GAAP TO NON-GAAP OPERATING EXPENSES IN MILLIONS FQ2'25 FQ3'25 FQ4'25 FQ1'26 FQ2'26 GAAP reported Operating Expenses $ 1,316 $ 1,329 $ 1,553 $ 1,604 $ 1,424 Certain items associated with acquisitions1 (5) (4) (4) (4) (4) Acquisition integration and deal costs — (
Slide 35: Unaudited Quarterly Reconciliation of Non-GAAP Free Cash Flow
UNAUDITED QUARTERLY RECONCILIATION OF NON-GAAP FREE CASH FLOW IN MILLIONS FQ3'21 FQ4'21 FQ2'25 FQ3'25 FQ4'25 FQ1'26 FQ2'26 Non-GAAP Free Cash Flows1 Cash provided by operating activities $ 1,686 $ 1,148 $ 1,571 $ 2,634 $ 2,828 $ 1,686 $ 845 Capital expenditures (137) (206) (510) (584) (785) (646) (6
Slide 36: Unaudited Full Year Reconciliation of Non-GAAP Free Cash Flow
UNAUDITED FULL YEAR RECONCILIATION OF NON-GAAP FREE CASH FLOW IN MILLIONS FY2016 FY2017 FY2018 FY2019 FY2020 Non-GAAP Free Cash Flows1 Cash provided by operating activities $ 2,566 $ 3,789 $ 3,787 $ 3,247 $ 3,804 Capital expenditures (253) (345) (622) (441) (422) Non-GAAP free cash flow $ 2,313 $ 3,
Slide 37: Reconciliation Information for Business Outlook
RECONCILIATION INFORMATION FOR BUSINESS OUTLOOK Non-GAAP outlook for the third quarter of fiscal 2026 (including non-GAAP gross margin, operating margin, operating expenses and EPS) excludes known charges related to completed acquisitions of ~$11 million, includes the normalized tax benefit of share
Slide 38: | Applied Materials External
| Applied Materials External