Applied Materials Announces Third Quarter Results
(Thomson Reuters ONE) -
* Q3 orders of $2.89 billion up 17% year over year, with record Silicon
Systems orders
* Q3 net sales of $2.49 billion up 10% year over year led by growth in
Silicon Systems and Services
* Q3 non-GAAP adjusted EPS of $0.33 up 18% year over year; GAAP EPS of $0.27
up 13% year over year
SANTA CLARA, Calif., Aug. 13, 2015 - Applied Materials, Inc. (NASDAQ:AMAT), the
global leader in materials engineering solutions for the semiconductor, display
and solar industries, today reported results for its third quarter ended July
26, 2015.
Third quarter orders were $2.89 billion, up 15 percent sequentially and up 17
percent year over year. Net sales were $2.49 billion, up 2 percent sequentially
and up 10 percent year over year.
On a non-GAAP adjusted basis, the company reported gross margin of 43.9 percent,
operating margin of 20.8 percent, and net income of $410 million or $0.33 per
diluted share. The company recorded GAAP gross margin of 40.9 percent, operating
margin of 15.9 percent, and net income of $329 million or $0.27 per diluted
share. The GAAP results included the effect of cost reduction actions in the
solar business consisting of $34 million of inventory charges and $17 million of
restructuring and asset impairment charges.
The company generated $334 million in cash from operations, paid dividends of
$123 million and used $625 million to repurchase 32 million shares of common
stock.
"Applied is focused on profitable growth and the results show in our third-
quarter performance when we delivered our highest ever 300mm semiconductor
equipment orders and record revenue in services," said Gary Dickerson, president
and CEO. "Our highly differentiated materials engineering products help
customers accelerate major technology inflections including 3D NAND, and this
quarter we generated the highest flash memory orders in our history."
Quarterly Results Summary
Change
--------------------------
Q3 FY2015 Q3 FY2015
vs. vs.
Q3 FY2015 Q2 FY2015 Q3 FY2014 Q2 FY2015 Q3 FY2014
----------- ----------- ----------- ------------- ------------
(In millions, except per share amounts and percentages)
New orders $2,892 $2,515 $2,479 15% 17%
Net sales $2,490 $2,442 $2,265 2% 10%
Gross margin (0.7) (2.9)
40.9% 41.6% 43.8% points points
Operating (1.1) (1.4)
margin 15.9% 17.0% 17.3% points points
Net income $329 $364 $301 (10)% 9%
Diluted
earnings per
share (EPS) $0.27 $0.29 $0.24 (7)% 13%
Change
-------------------------
Non-GAAP Q3 FY2015 Q3 FY2015
Adjusted vs. vs.
Results Q3 FY2015 Q2 FY2015 Q3 FY2014 Q2 FY2015 Q3 FY2014
----------------- ----------- ----------- ----------- ------------ ------------
(In millions, except per share amounts and percentages)
Non-GAAP
adjusted gross (1.6)
margin 43.9% 43.2% 45.5% 0.7 points points
Non-GAAP
adjusted
operating (0.3)
margin 20.8% 19.5% 21.1% 1.3 points points
Non-GAAP
adjusted net
income $410 $362 $349 13% 17%
Non-GAAP
adjusted
diluted EPS $0.33 $0.29 $0.28 14% 18%
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 fourth quarter of fiscal 2015, Applied expects net sales to be in the
range of flat to down 7 percent from the previous quarter, and non-GAAP adjusted
diluted EPS is expected to be in the range of $0.27 to $0.31.
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.
Third Quarter Reportable Segment Information
Silicon Systems Group Q3 FY2015 Q2 FY2015 Q3 FY2014
----------- ----------- ----------
(In millions, except percentages)
New orders $ 2,007 $ 1,704 $ 1,565
Foundry 32 % 36 % 50 %
DRAM 18 % 31 % 14 %
Flash 39 % 21 % 22 %
Logic and other 11 % 12 % 14 %
Net sales 1,635 1,560 1,476
Operating income 411 374 381
Operating margin 25.1 % 24.0 % 25.8 %
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income $ 455 $ 418 $ 423
Non-GAAP adjusted operating margin 27.8 % 26.8 % 28.7 %
Applied Global Services Q3 Q2 Q3
FY2015 FY2015 FY2014
--------- --------- --------
(In millions, except
percentages)
New orders $ 561 $ 641 $ 552
Net sales 665 646 567
Operating income 170 170 154
Operating margin 25.6 % 26.3 % 27.2 %
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income $ 173 $ 170 $ 154
Non-GAAP adjusted operating margin 26.0 % 26.3 % 27.2 %
Q3 Q2 Q3
Display FY2015 FY2015 FY2014
--------- --------- --------
(In millions, except
percentages)
New orders $ 295 $ 120 $ 296
Net sales 151 163 119
Operating income 25 40 25
Operating margin 16.6 % 24.5 % 21.0 %
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income $ 26 $ 40 $ 26
Non-GAAP adjusted operating margin 17.2 % 24.5 % 21.8 %
Q2 Q3
Energy and Environmental Solutions Q3 FY2015 FY2015 FY2014
----------- --------- -------
(In millions, except
percentages)
New orders $ 29 $ 50 $ 66
Net sales 39 73 103
Operating income (loss) (52 ) (5 ) 24
Operating margin (133.3 )% (6.8 )% 23.3 %
Non-GAAP Adjusted Results
Non-GAAP adjusted operating income (loss) $ (2 ) $ (4 ) $ 25
Non-GAAP adjusted operating margin (5.1 )% (5.5 )% 24.3 %
Backlog Information
Applied's backlog grew 11 percent sequentially to $3.10 billion and included
negative adjustments of $84 million, primarily consisting of order cancellations
from a foundry customer. Backlog composition by reportable segment was as
follows:
Silicon Systems Group 57 %
Applied Global Services 22 %
Display 17 %
Energy and Environmental Solutions 4 %
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 fourth quarter of fiscal 2015, 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) 408.235.4498
Michael Sullivan (financial community) 408.986.7977
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended Nine Months Ended
----------------------------------- ----------------------
(In millions,
except per share July 26, April 26, July 27, July 26, July 27,
amounts) 2015 2015 2014 2015 2014
----------- ----------- ----------- ----------- ----------
Net sales $ 2,490 $ 2,442 $ 2,265 $ 7,291 $ 6,808
Cost of products
sold 1,472 1,426 1,273 4,298 3,924
----------- ----------- ----------- ----------- ----------
Gross profit 1,018 1,016 992 2,993 2,884
Operating
expenses:
Research,
development and
engineering 372 365 357 1,088 1,068
Marketing and
selling 112 109 108 332 324
General and
administrative 135 140 126 392 375
Loss (gain) on
derivatives
associated with
terminated
business
combination 3 (14 ) 10 (89 ) 9
----------- ----------- ----------- ----------- ----------
Total operating
expenses 622 600 601 1,723 1,776
Income from
operations 396 416 391 1,270 1,108
Interest expense 24 24 24 71 72
Interest income
and other income
(loss), net 3 (3 ) 3 2 14
----------- ----------- ----------- ----------- ----------
Income before
income taxes 375 389 370 1,201 1,050
Provision for
income taxes 46 25 69 160 234
----------- ----------- ----------- ----------- ----------
Net income $ 329 $ 364 $ 301 $ 1,041 $ 816
----------- ----------- ----------- ----------- ----------
Earnings per
share:
Basic $ 0.27 $ 0.30 $ 0.25 $ 0.85 $ 0.67
Diluted $ 0.27 $ 0.29 $ 0.24 $ 0.84 $ 0.66
Weighted average
number of shares:
Basic 1,221 1,230 1,218 1,225 1,213
Diluted 1,231 1,241 1,233 1,238 1,230
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
October
July 26, April 26, 26,
(In millions) 2015 2015 2014
------------ ------------ -----------
ASSETS
Current assets:
Cash and cash equivalents $ 2,574 $ 3,067 $ 3,002
Short-term investments 169 163 160
Accounts receivable, net 1,991 1,798 1,670
Inventories 1,739 1,713 1,567
Other current assets 570 706 568
------------ ------------ -----------
Total current assets 7,043 7,447 6,967
Long-term investments 958 936 935
Property, plant and equipment, net 882 887 861
Goodwill 3,304 3,304 3,304
Purchased technology and other
intangible assets, net 811 860 951
Deferred income taxes and other assets 155 153 156
------------ ------------ -----------
Total assets $ 13,153 $ 13,587 $ 13,174
------------ ------------ -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable, notes payable and
accrued expenses $ 2,162 $ 1,822 $ 1,883
Customer deposits and deferred revenue 858 874 940
------------ ------------ -----------
Total current liabilities 3,020 2,696 2,823
Long-term debt 1,547 1,947 1,947
Other liabilities 609 593 536
------------ ------------ -----------
Total liabilities 5,176 5,236 5,306
------------ ------------ -----------
Total stockholders' equity 7,977 8,351 7,868
------------ ------------ -----------
Total liabilities and stockholders'
equity $ 13,153 $ 13,587 $ 13,174
------------ ------------ -----------
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Three Months Ended Nine Months Ended
----------------------------------- ----------------------
July 26, April 26, July 27, July 26, July 27,
(In millions) 2015 2015 2014 2015 2014
----------- ----------- ----------- ----------- ----------
Cash flows from
operating
activities:
Net income $ 329 $ 364 $ 301 $ 1,041 $ 816
Adjustments required
to reconcile net
income
to cash provided by
operating
activities:
Depreciation and
amortization 93 90 93 275 281
Share-based
compensation 46 47 44 141 132
Excess tax benefits
from share-based
compensation (3 ) (12 ) (1 ) (54 ) (26 )
Other 61 (8 ) 49 89 70
Net change in
operating assets and
liabilities (192 ) (183 ) 98 (800 ) 120
----------- ----------- ----------- ----------- ----------
Cash provided by 334 298 584
operating activities 692 1,393
----------- ----------- ----------- ----------- ----------
Cash flows from
investing
activities:
Capital expenditures (51 ) (64 ) (65 ) (164 ) (178 )
Proceeds from sales
and maturities of
investments 583 177 181 900 702
Purchases of
investments (616 ) (203 ) (308 ) (960 ) (632 )
----------- ----------- ----------- ----------- ----------
Cash used in (84 ) (90 ) (192 )
investing activities (224 ) (108 )
----------- ----------- ----------- ----------- ----------
Cash flows from
financing
activities:
Proceeds from common
stock issuances and
others, net 1 42 1 43 67
Common stock
repurchases (625 ) - - (625 ) -
Excess tax benefits
from share-based
compensation 3 12 1 54 26
Payments of
dividends to
stockholders (123 ) (123 ) (121 ) (368 ) (363 )
----------- ----------- ----------- ----------- ----------
Cash used in (744 ) (69 ) (119 )
financing activities (896 ) (270 )
----------- ----------- ----------- ----------- ----------
Effect of exchange
rate changes on cash
and cash equivalents 1 (1 ) - - -
----------- ----------- ----------- ----------- ----------
Increase (decrease) (493 ) 138 273
in cash and cash
equivalents (428 ) 1,015
Cash and cash
equivalents -
beginning of period 3,067 2,929 2,453 3,002 1,711
----------- ----------- ----------- ----------- ----------
Cash and cash $ 2,574 $ 3,067 $ 2,726
equivalents - end of
period $ 2,574 $ 2,726
----------- ----------- ----------- ----------- ----------
Supplemental cash
flow information:
Cash payments for
income taxes $ 51 $ 118 $ 49 $ 258 $ 108
Cash refunds from
income taxes $ 5 $ 2 $ 21 $ 10 $ 33
Cash payments for
interest $ 39 $ 7 $ 39 $ 85 $ 85
APPLIED MATERIALS, INC.
UNAUDITED SUPPLEMENTAL INFORMATION
Corporate Unallocated Expenses
Q3 Q2 Q3
(In millions) FY2015 FY2015 FY2014
--------- --------- --------
Share-based compensation $ 46 $ 47 $ 44
Certain items associated with terminated
business combination 1 29 23
Loss (gain) on derivative associated with
terminated business combination, net 3 (14 ) 10
Other unallocated expenses 108 101 116
--------- --------- --------
Total corporate $ 158 $ 163 $ 193
--------- --------- --------
Additional Information
Q3 FY2015 Q2 FY2015 Q3 FY2014
---------------- ---------------- ---------------
New Orders and Net Sales by
Geography
New Net New Net New Net
(In $ millions) Orders Sales Orders Sales Orders Sales
-------- ------- -------- ------- -------- ------
United States 262 650 368 632 680 683
% of Total 9 % 26 % 15 % 26 % 27 % 30 %
Europe 142 134 131 150 146 160
% of Total 5 % 6 % 5 % 6 % 6 % 7 %
Japan 727 271 365 257 378 229
% of Total 25 % 11 % 15 % 10 % 15 % 10 %
Korea 349 308 607 449 217 226
% of Total 12 % 12 % 24 % 18 % 9 % 10 %
Taiwan 828 751 589 455 497 598
% of Total 29 % 30 % 23 % 19 % 20 % 26 %
Southeast Asia 142 94 103 87 177 81
% of Total 5 % 4 % 4 % 4 % 7 % 4 %
China 442 282 352 412 384 288
% of Total 15 % 11 % 14 % 17 % 16 % 13 %
Employees (In thousands)
Regular Full Time 14.5 14.3 13.8
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
Three Months Ended Nine Months Ended
----------------------------------- ----------------------
(In millions,
except July 26, April 26, July 27, July 26, July 27,
percentages) 2015 2015 2014 2015 2014
----------- ----------- ----------- ----------- ----------
Non-GAAP Adjusted
Gross Profit
Reported gross
profit - GAAP
basis $ 1,018 $ 1,016 $ 992 $ 2,993 $ 2,884
Certain items
associated with
acquisitions(1) 41 39 38 120 116
Inventory charges
related to
restructuring(3) 34 - - 34 -
Acquisition
integration costs - - - - 1
----------- ----------- ----------- ----------- ----------
Non-GAAP adjusted
gross profit $ 1,093 $ 1,055 $ 1,030 $ 3,147 $ 3,001
----------- ----------- ----------- ----------- ----------
Non-GAAP adjusted
gross margin 43.9 % 43.2 % 45.5 % 43.2 % 44.1 %
Non-GAAP Adjusted
Operating Income
Reported operating
income - GAAP
basis $ 396 $ 416 $ 391 $ 1,270 $ 1,108
Certain items
associated with
acquisitions(1) 47 45 44 138 135
Acquisition
integration costs 1 - 9 2 30
Loss (gain) on
derivatives
associated with
terminated
business
combination, net 3 (14 ) 10 (89 ) 9
Certain items
associated with
terminated
business
combination(2) 1 29 23 50 50
Restructuring,
inventory charges
and asset
impairments(3, 4) 50 - - 50 7
Foreign exchange
loss due to
functional
currency change(5) 19 - - 19 -
----------- ----------- ----------- ----------- ----------
Non-GAAP adjusted
operating income $ 517 $ 476 $ 477 $ 1,440 $ 1,339
----------- ----------- ----------- ----------- ----------
Non-GAAP adjusted
operating margin 20.8 % 19.5 % 21.1 % 19.8 % 19.7 %
Non-GAAP Adjusted
Net Income
Reported net
income - GAAP
basis(6) $ 329 $ 364 $ 301 $ 1,041 $ 816
Certain items
associated with
acquisitions(1) 47 45 44 138 135
Acquisition
integration costs 1 - 9 2 30
Loss (gain) on
derivatives
associated with
terminated
business
combination, net 3 (14 ) 10 (89 ) 9
Certain items
associated with
terminated
business
combination(2) 1 29 23 50 50
Restructuring,
inventory charges
and asset
impairments(3, 4) 50 - - 50 7
Impairment (gain
on sale) of
strategic
investments, net (1 ) 6 (1 ) 6 (4 )
Foreign exchange
loss due to
functional
currency change(5) 19 - - 19 -
Reinstatement of
federal R&D tax
credit, resolution
of prior years'
income tax filings
and other tax
items(6) (21 ) (54 ) (19 ) (92 ) (22 )
Income tax effect
of non-GAAP
adjustments (18 ) (14 ) (18 ) (15 ) (45 )
----------- ----------- ----------- ----------- ----------
Non-GAAP adjusted
net income $ 410 $ 362 $ 349 $ 1,110 $ 976
----------- ----------- ----------- ----------- ----------
1 These items are incremental charges attributable to completed acquisitions,
consisting of amortization of purchased intangible assets.
2 These items are incremental charges related to the terminated business
combination agreement with Tokyo Electron Limited, consisting of
acquisition-related and integration planning costs.
3 Results for the three and nine months ended July 26, 2015 primarily included
$34 million of inventory charges and $17 million of restructuring charges
and asset impairments related to cost reductions in the solar business.
4 Results for the nine months ended July 27, 2014 included a $7 million of
employee-related costs related to the restructuring program announced on
October 3, 2012.
5 Results for the three and nine months ended July 26, 2015 included a $19
million foreign exchange loss due to an immaterial correction of an error
related to functional currency change.
6 Amounts for the three months ended April 26, 2015 and nine months ended July
26, 2015 included an adjustment to decrease the provision for income taxes
by $39 million and $35 million, respectively, with a corresponding increase
in net income, resulting in an increase in diluted earnings per share of
$0.03. The adjustment was excluded in Applied's non-GAAP adjusted results
and was made primarily to correct an error in the recognition of cost of
sales in the U.S. related to intercompany sales, which resulted in
overstating profitability in the U.S. and the provision for income taxes in
immaterial amounts in each year since fiscal 2010.
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
Three Months Ended Nine Months Ended
-------------------------------- --------------------
April
(In millions except per July 26, 26, July 27, July 26, July 27,
share amounts) 2015 2015 2014 2015 2014
---------- ---------- ---------- ---------- ---------
Non-GAAP Adjusted
Earnings Per Diluted
Share
Reported earnings per
diluted share - GAAP
basis(1) $ 0.27 $ 0.29 $ 0.24 $ 0.84 $ 0.66
Certain items
associated with
acquisitions 0.03 0.03 0.03 0.10 0.09
Acquisition integration
costs - - 0.01 - 0.02
Certain items
associated with
terminated business
combination - 0.02 0.02 0.03 0.04
Gain on derivative
associated with
terminated business
combination, net - (0.01 ) - (0.05 ) -
Restructuring,
inventory charges and
asset impairments 0.03 - - 0.03 -
Reinstatement of
federal R&D tax credit,
resolution of
prior years' income tax
filings and other tax
items(1) (0.02 ) (0.04 ) (0.02 ) (0.07 ) (0.02 )
Foreign exchange loss
due to functional
currency change 0.02 - - 0.02 -
---------- ---------- ---------- ---------- ---------
Non-GAAP adjusted
earnings per diluted
share $ 0.33 $ 0.29 $ 0.28 $ 0.90 $ 0.79
---------- ---------- ---------- ---------- ---------
Weighted average number
of diluted shares 1,231 1,241 1,233 1,238 1,230
1 Amounts for the three months ended April 26, 2015 and nine months ended July
26, 2015 included an adjustment to decrease the provision for income taxes
by $39 million and $35 million, respectively, with a corresponding increase
in net income, resulting in an increase in diluted earnings per share of
$0.03. The adjustment was excluded in Applied's non-GAAP adjusted results
and was made primarily to correct an error in the recognition of cost of
sales in the U.S. related to intercompany sales, which resulted in
overstating profitability in the U.S. and the provision for income taxes in
immaterial amounts in each year since fiscal 2010.
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
Three Months Ended Nine Months Ended
------------------------------- -----------------------
April July
(In millions, except July 26, 26, 27, July 26, July 27,
percentages) 2015 2015 2014 2015 2014
---------- ---------- --------- ------------ ----------
SSG Non-GAAP Adjusted
Operating Income
Reported operating
income - GAAP basis $ 411 $ 374 $ 381 $ 1,092 $ 1,086
Certain items
associated with
acquisitions(1) 44 44 42 131 126
Acquisition
integration costs - - - - 1
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating income $ 455 $ 418 $ 423 $ 1,223 $ 1,213
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating margin 27.8 % 26.8 % 28.7 % 26.4 % 26.7 %
AGS Non-GAAP Adjusted
Operating Income
Reported operating
income - GAAP basis $ 170 $ 170 $ 154 $ 493 $ 427
Certain items
associated with
acquisitions(1) - - - 1 3
Inventory charges
related to
restructuring(2) 3 - - 3 -
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating income $ 173 $ 170 $ 154 $ 497 $ 430
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating margin 26.0 % 26.3 % 27.2 % 26.2 % 26.7 %
Display Non-GAAP
Adjusted Operating
Income
Reported operating
income - GAAP basis $ 25 $ 40 $ 25 $ 137 $ 77
Certain items
associated with
acquisitions(1) 1 - 1 2 2
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating income $ 26 $ 40 $ 26 $ 139 $ 79
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating margin 17.2 % 24.5 % 21.8 % 23.6 % 18.6 %
EES Non-GAAP Adjusted
Operating Income
(Loss)
Reported operating
income (loss) - GAAP
basis $ (52 ) $ (5 ) $ 24 $ (61 ) $ 18
Certain items
associated with
acquisitions(1) 2 1 1 4 4
Restructuring,
inventory charges and
asset impairments(2) 48 - - 48 -
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating income
(loss) $ (2 ) $ (4 ) $ 25 $ (9 ) $ 22
---------- ---------- --------- ------------ ----------
Non-GAAP adjusted
operating margin (5.1 )% (5.5 )% 24.3 % (5.4 )% 9.5 %
1 These items are incremental charges attributable to completed acquisitions,
consisting of amortization of purchased intangible assets.
2 Results for the three and nine months ended July 26, 2015 included a $34
million of inventory charges and $17 million of restructuring charges and
asset impairments related to cost reductions in the solar business.
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED OPERATING EXPENSES
Three Months Ended
-----------------------
July April
(In millions) 26, 2015 26, 2015
----------- -----------
Operating expenses - GAAP basis $ 622 $ 600
Gain (loss) on derivative associated with terminated
business combination, net (3 ) 14
Restructuring charges and asset impairments (16 ) -
Certain items associated with acquisitions (6 ) (6 )
Acquisition integration costs (1 ) -
Certain items associated with terminated business
combination (1 ) (29 )
Foreign exchange loss due to functional currency change (19 ) -
----------- -----------
Non-GAAP adjusted operating expenses $ 576 $ 579
----------- -----------
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED EFFECTIVE INCOME TAX RATE
Three Months
Ended
(In millions, except percentages) July 26, 2015
---------------
Provision for income taxes - GAAP basis (a) $ 46
Reinstatement of federal R&D tax credit, resolutions of prior
years' income tax filings and other tax items 21
Income tax effect of non-GAAP adjustments 18
---------------
Non-GAAP adjusted provision for income taxes (b) $ 85
---------------
Income before income taxes - GAAP basis (c) $ 375
Certain items associated with acquisitions 47
Restructuring, inventory charges and asset impairments 50
Acquisition integration costs 1
Loss on derivative associated with terminated business
combination 3
Certain items associated with terminated business combination 1
Gain on strategic investments, net (1 )
Foreign exchange loss due to functional currency change 19
---------------
Non-GAAP adjusted income before income taxes (d) $ 495
---------------
Effective income tax rate - GAAP basis (a/c) 12.3 %
---------------
Non-GAAP adjusted effective income tax rate (b/d) 17.2 %
---------------
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GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Applied Materials via GlobeNewswire
[HUG#1945298]
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Datum: 13.08.2015 - 22:01 Uhr
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