Applied Materials, Inc. Q1 FY2024 Earnings Call

· Earnings call transcript and AI-powered summary

Overview

  • Applied Materials reported a strong start to fiscal 2024, with revenue at the high end of guidance and EPS above guidance.
  • Management emphasized continued outperformance versus the broader wafer fab equipment (WFE) market for the fifth consecutive year.
  • Major growth drivers include DRAM (especially high-bandwidth memory), advanced packaging, gate-all-around transistor adoption, and ICAPS markets (IoT, communications, automotive, power, sensors).

Market Environment & Business Trends

  • Customer sentiment improving across semiconductors: increasing fab utilization, normalizing memory inventory, and renewed investment among cloud players.
  • Leading-edge foundry-logic expected to be stronger year-over-year, though certain projects are delayed.
  • ICAPS market to be slightly weaker than 2023, following two years of extraordinary growth, but supported by regional investments.
  • DRAM continues to strengthen, driven by rapid HBM adoption. NAND expected to improve from 2023 lows but remains under 10% of total WFE.

Key Technology Growth Drivers

  • High-Bandwidth Memory (HBM): Expected to grow at a 50% CAGR, driven by AI data center demand. HBM packaging revenue expected to quadruple year-over-year to nearly $0.5B in FY2024. Total advanced packaging revenue expected at ~$1.5B.

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Operator: Welcome to the Applied Materials Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards you will be invited to participate in a question-and-answer session. I would now like to turn the conference over to Michael Sullivan, Corporate Vice President. Please go ahead, sir. Michael Sullivan: Good afternoon, everyone, and thank you for joining Applied’s First Quarter of Fiscal 2024 Earnings Call. Joining me are Gary Dickerson, our President and CEO; and Brice Hill, our Chief Financial Officer. Before we begin, I’d like to remind you that today’s call contains forward-looking statements, which are subject to risks and uncertainties that could cause our actual results to differ. Information concerning the risks and uncertainties is contained in Applied’s most recent Form 10-K filing with the SEC. Today’s call also includes non-GAAP financial measures. Reconciliations to GAAP measures are found in today’s earnings press release and in our quarterly earnings materials, which are available on our website at ir.appliedmaterials.com. Before we begin, I have a calendar announcement. On Monday evening, February 26, Applied will host a panel at the SPIE Advanced Lithography and Patterning Conference in San Jose. Joining us will be leading experts from NVIDIA, Intel, imec and Siemens EDA. We’ll also have demo stations with several new products and technologies, we’ll be introducing at the event. There won’t be a webcast, so we

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