Level 1 — Absolute Beginner
Applied Materials is a big company. It makes machines that help build computer chips.
The company said it made more money than ever before in the last three months.
It earned 9.12 billion dollars. That is 25 percent more than last year.
The company also said it expects to earn even more money in the next few months.
- company
- a business that makes or sells things
- machine
- a device built to do a job or task
- chip
- a small piece of material used to power computers and phones
- revenue
- the total money a company earns from selling things
- record
- the best or highest result ever reached
- percent
- a part out of every hundred
- profit
- the money a company keeps after paying its costs
- expect
- to believe something will happen
Level 2 — Elementary
Applied Materials, the world's largest maker of equipment used to manufacture computer chips, announced record results for its fiscal third quarter after the stock market closed on Thursday.
The company reported revenue of 9.12 billion dollars, a 25 percent increase compared to the same quarter last year, along with a record profit per share on an adjusted basis.
Executives said demand for chipmaking equipment remains strong because companies around the world keep building factories to produce the advanced chips used in artificial intelligence and other technology.
Applied Materials also gave guidance for its next quarter, predicting revenue near 10.25 billion dollars, which would mark another jump if the company hits that target.
- manufacture
- to make products, often using machines in a factory
- fiscal quarter
- a three month period used by a company for financial reporting
- executive
- a senior manager who runs part of a company
- adjusted
- changed slightly to give a clearer or fairer comparison
- demand
- how much people or companies want to buy something
- artificial intelligence
- computer systems built to perform tasks that normally need human thinking
- guidance
- a company's own prediction about its future results
- target
- a goal that a company aims to reach
Level 3 — Intermediate
Applied Materials, the world's largest supplier of semiconductor manufacturing equipment, posted record fiscal third quarter results on Thursday, reporting revenue of 9.12 billion dollars, a 25 percent jump from the same period a year earlier.
The company's non GAAP earnings per share also hit a record of 3.50 dollars, while GAAP earnings per share came in at 3.17 dollars, marking the fifth consecutive quarter in which the company has exceeded analysts' expectations.
Applied Materials generated record operating cash flow of 3.04 billion dollars during the quarter and returned 860 million dollars to shareholders through a combination of 440 million dollars in share buybacks and 420 million dollars in dividends.
Looking ahead, the company issued fourth quarter guidance calling for revenue of 10.25 billion dollars, plus or minus 500 million dollars, and non GAAP earnings per share of 4.02 dollars, plus or minus 20 cents, signaling continued confidence in demand tied to the global semiconductor equipment build out.
- semiconductor
- a material used to make computer chips, or the chips themselves
- non GAAP
- a way of reporting earnings that excludes certain one time or unusual costs
- GAAP
- a standard set of accounting rules companies must follow when reporting results
- consecutive
- following one after another without interruption
- operating cash flow
- the cash a company generates from its normal business activities
- buyback
- when a company purchases its own shares to reduce the number in the market
- dividend
- a payment a company makes to its shareholders from its profits
- build out
- the process of expanding infrastructure or capacity, such as new factories
Level 4 — Advanced
Applied Materials, the preeminent global supplier of wafer fabrication equipment, delivered record fiscal third quarter results on Thursday, posting revenue of 9.12 billion dollars, a 25 percent year over year increase that underscores sustained capital expenditure across the semiconductor industry.
Non GAAP earnings per share reached a record 3.50 dollars against GAAP earnings per share of 3.17 dollars, extending to five consecutive quarters the company's streak of exceeding Wall Street's consensus estimates, a run that has helped anchor investor confidence amid broader volatility in chip stocks.
The quarter also yielded record operating cash flow of 3.04 billion dollars, with management returning 860 million dollars to shareholders through 440 million dollars in share repurchases and 420 million dollars in dividend payments, a capital allocation posture that signals management's conviction in the durability of current demand.
Forward guidance reinforced that narrative: the company projected fourth quarter revenue of 10.25 billion dollars, plus or minus 500 million dollars, and non GAAP earnings per share of 4.02 dollars, plus or minus 20 cents, implying further sequential growth as customers continue expanding fabrication capacity for advanced logic and memory chips.
- preeminent
- surpassing all others; the most prominent or leading
- wafer fabrication
- the process of manufacturing semiconductor chips from thin silicon disks
- capital expenditure
- money a company spends on physical assets like factories or equipment
- consensus estimate
- the average forecast made by financial analysts covering a company
- volatility
- a tendency for prices or values to change rapidly and unpredictably
- repurchase
- the act of buying something back, such as a company buying its own shares
- capital allocation
- the way a company decides to distribute its financial resources
- sequential
- following in order, such as one quarter after the previous one
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