SANTA CLARA, CA, Nov 13, 2015 - (ACN Newswire) - Applied Materials, Inc. (NASDAQ:AMAT), the global leader in materials engineering solutions for the semiconductor, display and solar industries, today reported results for its fourth quarter and fiscal year ended October 25, 2015.
Fourth quarter orders were $2.42 billion, down 16 percent sequentially and up 7 percent year over year. Net sales were $2.37 billion, down 5 percent sequentially and up 5 percent year over year.
On a non-GAAP adjusted basis, the company reported fourth-quarter gross margin of 42.2 percent, operating margin of 19.3 percent, and net income of $347 million or $0.29 per diluted share. The company recorded GAAP gross margin of 40.5 percent, operating margin of 17.9 percent, and net income of $336 million or $0.28 per diluted share.
The company generated $471 million in cash from operations during the fourth quarter, paid dividends of $119 million and used $700 million to repurchase 44 million shares of common stock at an average price of $15.78.
Full Year Results
In fiscal 2015, orders grew 5 percent to $10.10 billion, net sales increased 6 percent to $9.66 billion, non-GAAP adjusted gross margin declined 1.2 percentage points to 42.9 percent, non-GAAP adjusted operating margin remained at 19.6 percent, and non-GAAP adjusted net income increased by 10.9 percent to $1.46 billion or $1.19 per diluted share. The company recorded GAAP gross margin of 40.9 percent, operating income of $1.69 billion or 17.5 percent of net sales, and net income of $1.38 billion or $1.12 per diluted share.
The company generated $1.16 billion in cash from operations in fiscal 2015, paid dividends of $487 million and used $1.33 billion to repurchase 76 million shares of common stock.
"In fiscal 2015, Applied Materials delivered year-over-year growth across our semiconductor, display and service businesses resulting in our highest earnings in four years," said Gary Dickerson, president and CEO. "We have positioned the company for sustainable profitable growth and we are winning share, growing our service business and expanding our available market."
Quarterly Results Summary
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Change
Q4 FY2015 Q3 FY2015 Q4 FY2014 A B
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(In millions, except per share amounts and percentages)
New orders $2,424 $2,892 $2,255 (16)% 7%
Net sales $2,368 $2,490 $2,264 (5)% 5%
Gross margin 40.5% 40.9% 42.4% (0.4) (1.9)
points points
Operating margin 17.9% 15.9% 18.2% 2.0 (0.3)
points points
Net income $336 $329 $256 2% 31%
Diluted earnings per share (EPS)
$0.28 $0.27 $0.21 4% 33%
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A: Q4 FY2015 vs. Q3 FY2015
B: Q4 FY2015 vs. Q4 FY2014
Non-GAAP Adjusted Results
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Change
Q4 FY2015 Q3 FY2015 Q4 FY2014 A B
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(In millions, except per share amounts and percentages)
Non-GAAP adjusted gross margin
42.2% 43.9% 44.2% (1.7) (2.0)
points points
Non-GAAP adjusted operating margin
19.3% 20.8% 19.5% (1.5) (0.2)
points points
Non-GAAP adjusted net income
$347 $410 $338 (15)% 3%
Non-GAAP adjusted diluted EPS
$0.29 $0.33 $0.27 (12)% 7%
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A: Q4 FY2015 vs. Q3 FY2015
B: Q4 FY2015 vs. Q4 FY2014
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 first quarter of fiscal 2016, Applied expects net sales to be down 2 percent to 9 percent sequentially. Non-GAAP adjusted diluted EPS is expected to be in the range of $0.23 to $0.27.
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.
Fourth Quarter and Fiscal Year Reportable Segment Information
Silicon Systems
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Q4 FY2015 Q3 FY2015 Q4 FY2014 FY2015 FY2014
(In millions, except percentages)
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New orders $ 1,444 $ 2,007 $ 1,334 $ 6,581 $ 6,132
Foundry 35% 32% 50% 34% 52%
DRAM 21% 18% 20% 25% 14%
Flash 31% 39% 12% 28% 21%
Logic and other 13% 11% 18% 13% 13%
Net sales 1,494 1,635 1,434 6,135 5,978
Operating income 318 411 305 1,410 1,391
Operating margin 21.3% 25.1% 21.3% 23.0% 23.3%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income
$ 365 $ 455 $ 352 $ 1,588 $ 1,565
Non-GAAP adjusted operating margin
24.4% 27.8% 24.5% 25.9% 26.2%
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Applied Global Services
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Q4 FY2015 Q3 FY2015 Q4 FY2014 FY2015 FY2014
(In millions, except percentages)
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New orders $ 761 $ 561 $ 747 $ 2,653 $ 2,433
Net sales 637 665 592 2,531 2,200
Operating income 171 170 146 664 573
Operating margin 26.8% 25.6% 24.7% 26.2% 26.0%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income
$ 170 $ 173 $ 146 $ 667 $ 576
Non-GAAP adjusted operating margin
26.7% 26.0% 24.7% 26.4% 26.2%
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Display
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Q4 FY2015 Q3 FY2015 Q4 FY2014 FY2015 FY2014
(In millions, except percentages)
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New orders $ 195 $ 295 $ 130 $ 717 $ 845
Net sales 191 151 190 780 615
Operating income 19 25 52 156 129
Operating margin 9.9% 16.6% 27.4% 20.0% 21.0%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income
$ 19 $ 26 $ 52 $ 158 $ 131
Non-GAAP adjusted operating margin
9.9% 17.2% 27.4% 20.3% 21.3%
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Energy and Environmental Solutions
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Q4 FY2015 Q3 FY2015 Q4 FY2014 FY2015 FY2014
(In millions, except percentages)
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New orders $ 24 $ 29 $ 44 $ 153 $ 238
Net sales 46 39 48 213 279
Operating income (loss)
- (52) (3) (61) 15
Operating margin -% (133.3)% (6.3)% (28.6)% 5.4%
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income (loss)
$ (1) $ (2) $ (1) $ (10) $ 21
Non-GAAP adjusted operating margin
(2.2)% (5.1)% (2.1)% (4.7)% 7.5%
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Backlog Information
Applied's backlog remained essentially flat at $3.14 billion and included negative adjustments of $13 million. Backlog composition by reportable segment was as follows:
Silicon Systems 55%
Applied Global Services 26%
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 first 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-Q 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) +1-408-235-4498
Michael Sullivan (financial community) +1-408-986-7977
Press release: http://bit.ly/1MaeiG6
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Source: Applied Materials via Globenewswire
Topic: Earnings
Source: Applied Materials, Inc.
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