Backlog and Revenue - Semiconductor Systems segment backlog as of October 27, 2024, is 8,259million,downfrom11,127 million in 2023, representing a 25% decrease[20] - Applied Global Services segment backlog increased to 6,767million,a315,162 million in 2023[20] - Total backlog as of October 27, 2024, is 15,873million,downfrom17,171 million in 2023, indicating a 7.5% decline[20] - Approximately 31% of the total backlog is not expected to be filled within the next 12 months[20] - New export rules and regulations are expected to reduce backlog by approximately 549million[20]−Netrevenueforfiscal2024was27,176 million, an increase of 2% compared to 26,517millioninfiscal2023[118]−TheSemiconductorSystemssegmentgenerated19,911 million in revenue, accounting for 73% of total revenue, with a 1% increase from 19,698millioninfiscal2023[118]−AppliedGlobalServices(AGS)segmentrevenueroseto6,225 million, a 9% increase from 5,732millioninfiscal2023[118]−Displaysegmentrevenueincreasedto885 million, up 2% from 868millioninfiscal2023,drivenbyhigherinvestmentsindisplayfabricationequipment[120]−RevenuefromcustomersinChinasurgedby4010,117 million, reflecting increased investments in semiconductor equipment[121] Financial Performance - Gross margin improved to 47.5% in fiscal 2024, up from 46.7% in fiscal 2023, primarily due to lower material and manufacturing costs[118] - Operating income for fiscal 2024 was 7,867million,anincreaseof213 million from 7,654millioninfiscal2023[118]−Netincomeforthefiscalyearwas7,177 million, compared to 6,856millionin2023,representingagrowthof4.78.68, up from 8.16in2023,whiledilutedEPSincreasedto8.61 from 8.11[187]−Thecompanyreportedacomprehensiveincomeof7,226 million for 2024, an increase from 6,841 million in 2023, driven by various factors including unrealized gains on investments[190] Expenses and Investments - Research, development, and engineering (RD&E) expenses rose to 3,233 million, an increase of 131millionfrom3,102 million in fiscal 2023, due to additional headcount[122] - Operating expenses for marketing and selling increased to 836million,up60 million from 776millioninfiscal2023[122]−Generalandadministrativeexpensesincreasedto961 million, reflecting higher share-based compensation and professional fees[122] - Capital expenditures for fiscal year 2024 totaled 1,190million,comparedto1,106 million in 2023[200] Workforce and Employee Development - As of October 27, 2024, the company employed approximately 35,700 regular full-time employees, with 45% in the Asia-Pacific region, 43% in North America, and 12% in Europe/Middle East[32] - The global workforce composition is 79.2% male and 20.6% female, with 19.8% of the U.S. workforce being underrepresented minorities[33] - The company plans to conduct an all-employee survey in fiscal 2025 to measure engagement and inclusion, benchmarking against large technology companies[36] - The company invests in employee development through a 70/20/10 learning model, focusing on on-the-job learning, social collaboration, and formal training[35] - The ability to attract and retain key employees is critical for the company's success, with competition for talent being a significant challenge[79] Risks and Regulatory Environment - The company is subject to various international laws affecting trade policies, export regulations, and intellectual property, which could impact competitiveness[30] - The company faces risks from global trade issues, including changes in trade policies and export regulations, which could adversely impact operations and competitiveness[50] - The U.S. government has imposed additional export regulations on semiconductor technology sold in China, limiting market access and increasing competition[50] - The geopolitical landscape, including political instability and trade disputes, poses risks to the company's operations and supply chain[54] - The company is subject to various global regulatory risks, including compliance with laws related to financial disclosures, environmental regulations, and cybersecurity, which could adversely impact business operations and financial condition[90] Cash Flow and Financial Position - Cash and cash equivalents as of October 27, 2024, were 8,022million,upfrom6,132 million on October 29, 2023[132] - Cash provided by operating activities for fiscal 2024 was 8,677million,remainingrelativelyflatcomparedto8,700 million in 2023[135] - Cash used in investing activities was 2,327millioninfiscal2024,comparedto1,535 million in 2023[136] - Cash used in financing activities was 4,470millioninfiscal2024,anincreasefrom3,032 million in 2023[138] - The company has 6.2billioninaggregateprincipalamountofseniorunsecurednotesoutstandingasofOctober27,2024[83]SustainabilityandEnvironmentalImpact−Thereisafocusonreducingenergyusageandimprovingsustainabilityinmanufacturingoperations,whichiscriticalforfuturegrowth[59]−Thecompanymaintainspreventativeprogramsforenvironmental,health,andsafetyregulations,regularlymonitoringcompliance[30]−Implementationofsustainabilitystrategiesmayincuradditionalcosts,andfailuretomeetsustainabilitytargetscouldharmthecompany′sreputationandperformance[91]−Thecompanyisexposedtorisksassociatedwithexpandingintonewandrelatedmarkets,requiringadditionalresourcesandnewsalesstrategies[68]ShareholderReturns−Atotalofapproximately8.9 billion remains available for future stock repurchases under the company's stock repurchase program, which was authorized for 10.0billioninMarch2023[110]−Thecompanyhasrepurchasedatotalof7.6millionsharesduringthefourthquarteroffiscal2024,withanaveragepriceof190.89 per share[110] - The company declared dividends of 1.52percommonsharein2024,upfrom1.22 per share in 2023, reflecting a 24.6% increase[197]
Applied Materials(AMAT)2024-12-13 21:01