Slide 1: Fourth Quarter and Fiscal Year 2009 Earnings Call Highlights
Fourth Quarter and Fiscal Year 2009 Earnings Call Highlights November 11, 2009 Baccini Esatto(tm) - Multiple Printing Capability for Producing Higher Efficiency Solar Cells
Slide 2: Safe Harbor Statement
2 Safe Harbor Statement This presentation contains forward-looking statements, including those regarding Applied's performance, cost structure, strategic and cost reduction initiatives, and opportunities, as well as industry outlooks. Forward-looking statements, including their underlying assumption
Slide 3: Contents
Contents Financial highlights (consolidated): Income statement (Q4'09 and FY2009) Summary income statement table (Q4'08 and FY2008) New orders regional distribution (Q4'08 and FY2008) Balance sheet Summary balance sheet table Reporting segments: FY2005 - 2009 New Orders and Net Sales by Segment Q4'0
Slide 4: Q4'09 Financial Summary: Income Statement (consolidated)
4 Q4'09 Financial Summary: Income Statement (consolidated) New orders: $1.47 billion - up 37% from Q3'09 led by EES and Display Backlog: $2.73 billion - down 7% from Q3'09 Adjustments totaled $171M: cancellations $168M, currency adjustments $3M Net sales: $1.53 billion - up 35% from Q3'09 Driven by
Slide 5: Summary Income Statement (consolidated)
5 Summary Income Statement (consolidated)
Slide 6: Fiscal 2009 Financial Highlights: Income Statement (consolidated)
6 Fiscal 2009 Financial Highlights: Income Statement (consolidated) New orders: $4.10B - down 55% from FY'08 Net sales: $5.01B - down 38% from FY'08 Operating loss: $394M Down from operating income of $1.36B in FY'08 or 17% of revenue Net loss and net loss per share: $305M or $0.23 per share Down fr
Slide 7: Fiscal Year Summary Income Statement (Consolidated)
7 Fiscal Year Summary Income Statement (Consolidated) (Unaudited)
Slide 8: QoQ New Orders Regional Distribution (consolidated)
8 QoQ New Orders Regional Distribution (consolidated) Q4 FY'09 $1.47 Billion North America 14% Europe 5% Japan 8% Korea 20% Taiwan 15% SEA/ China 38% Q3 FY'09 $ 1.07 Billion North America 14% Europe 12% Japan 14% Korea 11% Taiwan 24% SEA/ China 25%
Slide 9: YoY New Orders Regional Distribution (consolidated)
YoY New Orders Regional Distribution (consolidated) 9 FY'09 $4.10 Billion North America 17% Europe 17% Japan 13% Korea 14% Taiwan 15% SEA/ China 24% FY'08 $ 9.16 Billion North America 18% Europe 13% Japan 13% Korea 16% Taiwan 23% SEA/ China 17%
Slide 10: Q4'09 Financial Summary: Balance Sheet (consolidated)
10 Q4'09 Financial Summary: Balance Sheet (consolidated) Cash/cash equivalents and investments increased $138M to $3.27B Operating cash flow: $241M or 16% of revenue Free cash flow*: $180M or 12% of revenue Inventory: $1.63B - down $121 million from Q3'09 DSO**: 62 days, compared to 68 days in Q3'09
Slide 11: Summary Balance Sheet (Consolidated)
11 Summary Balance Sheet (Consolidated)
Slide 12: Fiscal Year Summary Balance Sheet (Consolidated)
12 Fiscal Year Summary Balance Sheet (Consolidated)
Slide 13: Reporting Segments
13 Reporting Segments Designs, manufactures and sells equipment used to fabricate semiconductor chips Designs, manufactures and sells equipment used to fabricate solar cells and modules, flexible electronics and energy-efficient glass Silicon Broad range of products1 to maintain, service and optimiz
Slide 14: FY2005 - 2009 New Orders and Net Sales by Segment
14 FY2005 - 2009 New Orders and Net Sales by Segment New Orders: Net Sales: $Millions $Millions $6.39B $9.89B $9.68B $6.99B $9.17B $9.73B $9.16B $8.13B $4.10B $5.01B
Slide 15: Q4'09 New Orders and Net Sales by Segment
15 Q4'09 New Orders and Net Sales by Segment Silicon $629M 43% Display $151M 10% AGS $335M 23% EES $357M 24% New Orders $1.47 Billion Silicon $656M 43% Display $200M 13% AGS $390M 26% EES $280M 18% Net Sales $1.53 Billion
Slide 16: Backlog by Segment
16 Backlog by Segment Q3 FY'09 $2.95 Billion Q4 FY'09 $2.73 Billion
Slide 17: Silicon Segment Summary
17 Silicon Segment Summary Orders up 16% QoQ Led by foundry for third consecutive quarter Net sales up 32% QoQ Driven by foundry, logic and memory customers 61% of revenue resulted from orders within current quarter Operating income up 183% QoQ New Orders Net Sales Operating Income and Margin 24% $1
Slide 18: Q4'09 Silicon Systems New Orders Summary
18 Q4'09 Silicon Systems New Orders Summary By Application By Linewidth
Slide 19: Applied Global Services Segment Summary
19 Applied Global Services Segment Summary Orders up 13% QoQ Net sales up 14% QoQ Operating income of $64M or 17% of revenue Driven by accelerating recovery in spares sales New Orders Net Sales Operating Income and Margin $496M $298M $335M 17% $64M Q4'08 Q3'09 Q4'09 Q4'08 Q3'09 Q4'09 Net Sales & Ope
Slide 20: Display Segment Summary
20 Display Segment Summary Orders up 58% QoQ Gen 8.5 capacity investments fueled by robust end-market demand Net sales up 189% QoQ Signed off multiple leading- edge systems at top customers Operating income of $43M or 21% of revenue Benefited from the sharp revenue improvement New Orders $96M $151M
Slide 21: Energy & Environmental Solutions Segment Summary
21 Energy & Environmental Solutions Segment Summary Orders up 164% QoQ Driven by SunFab project in China Net sales up 25% QoQ Reflected signoff of a tandem junction SunFab line, offset by a slight decline in c-Si Operating loss of $30M, improved 40% QoQ >50% of loss attributable to M&A charges and n
Slide 22: Industry Outlook
22 Industry Outlook Semiconductor: End market demand strengthened in CQ3'09 IC sales jumped 19.7% QoQ in CQ3, utilization rates higher 2010 outlook: Expect Wafer Fab Equipment spending $18 - 20B, up from $12 - 13B estimated for 2009 Display: LCD TV demand remained strong in CQ3'09, China led all reg
Slide 23: Announced Cost Reduction Program
23 Announced Cost Reduction Program Applied is taking the following actions to strengthen its leadership in global markets and enhance operating efficiencies: Embedding sales force within business groups to be closer to customers Consolidating its manufacturing and supply chain closer to more of its
Slide 24: Q1'10 Expectations (As of November 11, 2009)
24 Q1'10 Expectations (As of November 11, 2009) Q1'10 Expectations will be posted after earnings call
Slide 25: Reconciliation of GAAP to NON-GAAP Results
25 Reconciliation of GAAP to NON-GAAP Results
Slide 26: Reconciliation of GAAP to Non-GAAP Measures - Free Cash Flow
26 Reconciliation of GAAP to Non-GAAP Measures - Free Cash Flow Free Cash Flow Free Cash Flow Three months ended October 25, 2009 Three months ended July 26, 2009 Cash from Operations $240,582 $193,713 Capital Expenditures $(60,623) $(59,705) Free cash flow $179,959 $134,008 Revenue $1,526,394 $1,13
Slide 27: Impact of Items Included in Consolidated Condensed Statements of Operations
Impact of Items Included in Consolidated Condensed Statements of Operations 27
Slide 28: Impact of Items Included in Consolidated Condensed Statements of Operations - QoQ
Impact of Items Included in Consolidated Condensed Statements of Operations - QoQ 28
Slide 29: Thank You. Applied Materials
Thank You. Applied Materials Confidential