Applied Materials, Inc. Q4 FY2022 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter and Fiscal Year Highlights

  • Q4 FY2022 delivered record net sales of approximately $6.75 billion and record non-GAAP EPS of $2.03, representing strong sequential performance.
  • Full-year revenue rose nearly 12% to $25.8 billion compared to FY2021, averaging strong demand despite global supply chain constraints.
  • Non-GAAP EPS for FY2022 increased nearly 13% to $7.70 year-over-year.
  • Annual operating cash flow reached $5.4 billion; free cash flow totaled $4.6 billion.
  • Backlog reached a record $19 billion at year-end, up 62% from FY2021, driven by strong Semi Systems demand and record AGS bookings.
  • Returned nearly $7 billion to shareholders through dividends and share repurchases.

Segment Performance

  • Semi Systems: Q4 revenue rose 6% sequentially to $5.04 billion; operating margin grew to 36.9%. Backlog increased significantly (up 90% YoY to $12.7 billion).
  • Applied Global Services (AGS): Q4 revenue flat at $1.42 billion; operating margin fell to 28.3% due to export restrictions. Installed base grew 8% YoY; long-term service agreements grew 16% with renewal rates above 90%.
  • Display: Q4 revenue fell to $251 million, with a decline in operating margin to 13.5% (consistent with expectations).

Supply Chain and Backlog

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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’d now 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 Fourth Quarter of Fiscal 2022 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-Q and 8-K filings 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 the IR page of our website at appliedmaterials.com. Before we begin, I have a calendar announcement. Applied plans to hold an eBeam technology and new product webcast on Wednesday, December 14 at 9:00 a.m. Pacific Time. Please stay tuned for an invitation to join our presenter, Keith Wells, who is Group Vice President and General Manager of our Imaging and Process Control Group. And with that introduction, I'd like to turn the call ov

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