First Quarter Fiscal 2026 Earnings Presentation Applied Materials External Forward-Looking Statements This presentation contains forward-looking statements, including those regarding anticipated growth and trends in our businesses and markets, industry outlooks and demand drivers, technology transitions, our business and financial performance and market share positions, our capital allocation and cash deployment strategies, our investment and growth strategies, our development of new products and technologi ...

Group 1 - Applied Materials forecasts second-quarter revenue of approximately $7.65 billion, exceeding market estimates of $7.01 billion, with a margin of plus or minus $500 million [1] - The company anticipates an adjusted profit of about $2.64 per share, compared to estimates of $2.28 per share, with a margin of plus or minus 20 cents [1] - The surge in demand for AI processors is driving sales of chipmaking equipment, contributing to the company's optimistic outlook [1] Group 2 - Applied Materials is benefiting from a global memory shortage, as memory providers are increasing investments to boost manufacturing capacity [1] - The company's shares rose by 9% in extended trading following the positive forecast [1] - As the largest U.S. semiconductor equipment maker, Applied Materials is positioned to capitalize on the expanding production capacity of chip manufacturers [1]

Core Viewpoint - Applied Materials forecasts second-quarter revenue and profit above market estimates, driven by demand for AI processors and a global memory shortage [1][2] Group 1: Financial Performance - The company expects second-quarter sales of approximately $7.65 billion, with a margin of plus or minus $500 million, compared to market estimates of $7.01 billion [2] - Applied Materials reported first-quarter revenue of $7.01 billion, exceeding estimates of $6.87 billion, with record DRAM sales year-on-year [6] - The first-quarter profit was reported at $2.38 per share, excluding items, surpassing analyst expectations of $2.20 per share [8] Group 2: Market Drivers - The rapid expansion of AI infrastructure is significantly boosting demand for chipmaking equipment, which is a major driver for Applied Materials [1][2] - The need for higher performance and energy-efficient chips is leading to high growth rates in leading-edge logic, high-bandwidth memory, and advanced packaging [3] - Memory and logic-foundry capital expenditure growth are both significant, with memory being a greater growth driver in the near term [4] Group 3: Future Outlook - Applied Materials anticipates that DRAM will be its fastest-growing segment by 2026, alongside 3D chiplet stacking technology used in AI processors [5] - The company forecasts an adjusted profit of about $2.64 per share for the second quarter, with a margin of plus or minus 20 cents, compared to estimates of $2.28 [3]

Core Insights - Applied Materials reported strong first-quarter results, driven by increased industry investments in AI computing and semiconductor technologies [4][7][9] Financial Performance - Revenue for Q1 FY2026 was $7.01 billion, a decrease of 2% compared to Q1 FY2025's $7.17 billion [5][7] - GAAP gross margin was 49.0%, while non-GAAP gross margin was 49.1%, showing slight improvements year-over-year [5][7] - Operating income on a GAAP basis was $1.83 billion (26.1% of net revenue), and on a non-GAAP basis, it was $2.11 billion (30.0% of net revenue) [2][5] - Net income increased by 71% to $2.03 billion, with diluted earnings per share (EPS) rising 75% to $2.54 [5][7] Cash Flow and Shareholder Returns - The company generated $1.69 billion in cash from operations and returned $702 million to shareholders through share repurchases and dividends [3][5] - Non-GAAP free cash flow for the quarter was $1.04 billion, a 91% increase from $544 million in the previous year [5][34] Business Outlook - For Q2 FY2026, Applied expects total revenue of approximately $7.65 billion, with non-GAAP diluted EPS projected at $2.64 [9] - The semiconductor equipment business is anticipated to grow over 20% in the calendar year, driven by demand for advanced technologies [4][9] Segment Performance - Semiconductor Systems revenue was $5.14 billion, down from $5.60 billion in the previous year, with a gross margin of 54.3% [11][12] - Applied Global Services reported revenue of $1.56 billion, up from $1.35 billion, with a gross margin of 34.4% [13][12] Recent Developments - Samsung Electronics will join Applied's new EPIC Center in Silicon Valley, aimed at accelerating the commercialization of breakthrough technologies [6][12] - The company introduced new systems to enhance the performance of next-generation transistors, receiving awards for technology development and sustainability [12][19]

Group 1 - Qnity Electronics stock's Relative Strength Rating increased from 70 to 79, indicating improved price performance over the past 52 weeks [1] - IBD's rating system scores stocks on a scale from 1 (worst) to 99 (best), reflecting their share price movement [1] Group 2 - Semiconductor equipment vendor Nova exceeded fourth-quarter estimates and provided an optimistic guidance for the current period [1] - Other companies such as Wabtec and Vertiv reached record highs, contributing to a list of nine new stocks to watch [1] - Axcelis Technologies received a boost in its Relative Strength Rating, indicating positive market sentiment [1]

Core Viewpoint - ASML's stock has increased by approximately 90% over the past year, with expectations for further growth driven by the expanding AI market [1] Group 1: Company Overview - ASML is the largest producer of lithography systems globally, essential for etching circuit patterns onto silicon wafers [1] - It is the sole manufacturer of high-end extreme ultraviolet (EUV) lithography systems, crucial for producing advanced, power-efficient chips [1][2] Group 2: Market Position and Demand - Major foundries such as TSMC, Samsung, and Intel utilize ASML's EUV systems for their most advanced chip manufacturing processes, indicating strong demand for ASML's technology [2] - The reliance of fabless chipmakers like Nvidia on ASML's systems highlights the company's critical role in the AI chip production ecosystem [2] Group 3: Financial Projections - ASML anticipates revenue growth to reach between 44 billion euros ($52.3 billion) and 60 billion euros ($71.3 billion) by 2030, representing a compound annual growth rate (CAGR) of 10% from 2025 [3] - Analysts project ASML's earnings per share (EPS) to grow at a CAGR of 24% from 2025 to 2027 [3] Group 4: Valuation and Investment Considerations - ASML's stock is currently valued at 41 times this year's earnings, reflecting its dominant position in a key technology sector and exposure to the growing AI market [4] - The premium valuation is justified by the expected catalysts that could drive stock performance higher in 2026 and beyond [4]

Core Insights - Renaissance Group has made significant portfolio adjustments, indicating a strong focus on streaming, AI infrastructure, and enterprise software as key investment areas [1]. Group 1: Portfolio Changes - Renaissance increased its stake in Netflix by nearly 900% quarter-over-quarter, raising holdings to 355,377 shares, despite a 22% decline in the dollar value of the position due to price fluctuations [2]. - The fund's investment in Lam Research surged by over 1,800%, making it one of the fastest-growing positions, reflecting increased confidence in AI-related semiconductor infrastructure [3]. - ServiceNow also saw a substantial increase in holdings, with Renaissance boosting its position by more than 400%, aligning with the trend towards enterprise software and automation [3]. Group 2: Investment Themes - The portfolio reshuffle emphasizes a strategic shift towards high-growth technology enablers rather than solely consumer-facing platforms [4]. - The moves highlight institutional confidence in streaming platforms with pricing power, semiconductor equipment supporting AI growth, and enterprise cloud software [5]. - The current investment landscape suggests that hedge funds are increasingly focusing on AI infrastructure and technology-driven platforms while exploring new sector opportunities [5].

Core Insights - The equity market experienced a positive period in 2025, with the S&P 500 Index returning 2.7% in Q4 and finishing the year up 17.9% [1] - The market's performance was significantly influenced by the communication services and technology sectors, with earnings growth driving market expansion [1] - Carillon Eagle Growth & Income Fund holds net assets of $493.06 million across 48 holdings, indicating a diversified investment strategy [1] Company-Specific Insights - Lam Research Corporation (NASDAQ:LRCX) was highlighted as a leading contributor to the fund's performance, with a stock price of $235.12 per share as of February 11, 2026, and a one-month return of 8.98% [2] - Over the past twelve months, Lam Research's shares increased by 184.52%, and the company has a market capitalization of $297.943 billion [2] - The company benefits from improving sentiment regarding its products in the semiconductor capital spending market, with confirmed growth projections supported by bookings data [3] - Lam Research is recognized as a leading provider of equipment tied to memory requirements for AI, suggesting a strong growth trajectory moving forward [3] Hedge Fund Interest - Lam Research Corporation is held by 93 hedge fund portfolios at the end of Q3, an increase from 85 in the previous quarter, indicating growing interest among institutional investors [4] - Despite its potential, the company is not listed among the 30 Most Popular Stocks Among Hedge Funds, with some analysts suggesting that certain AI stocks may offer greater upside potential with less downside risk [4]

Company Performance - Cisco Systems (CSCO) stock fell over 7% at the open due to a gloomy profit outlook despite a rise in sales, as the company expects margins to be squeezed by memory costs linked to AI datacenter spending [3] - McDonald's (MCD) shares nudged higher after the burger giant's earnings beat expectations [6] - Upcoming earnings reports to watch include Coinbase (COIN), Applied Materials (AMAT), and Rivian (RIVN), all scheduled for release after the market close [6] Economic Indicators - The Dow Jones Industrial Average (^DJI) increased by approximately 0.5%, while the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) both gained around 0.3% [2] - Jobless claims showed a smaller decline than expected, with nonfarm payrolls data indicating the US economy added twice as many jobs as anticipated in January, complicating expectations for Federal Reserve policy [5] - Attention is turning to the upcoming Consumer Price Index report, with hopes that a softer reading will indicate easing price pressures while maintaining economic growth [4]

Core Insights - Direxion has launched four new single-stock ETFs with 2x leverage, targeting key companies in the semiconductor, e-commerce, and fintech sectors [1] Group 1: New ETF Launches - The new ETFs include: - Direxion Daily SOFI Bull 2X ETF (SOFA) for the digital banking platform [1] - Direxion Daily MRVL Bull 2X ETF (MRVU) for the data infrastructure company [1] - Direxion Daily BABA Bull 2X ETF (BABU) for the Chinese e-commerce giant [1] - Direxion Daily ASML Bull 2X ETF (ASMU) for the lithography machine provider [1] Group 2: Market Context - The launch responds to ongoing market uncertainty and the need for precision trading tools [1] - These companies are positioned at the core of the digital economy, which is increasingly influenced by AI, machine learning, and cloud computing [1] Group 3: Target Audience - The leveraged ETFs are designed for seasoned traders with high conviction during critical market events such as earnings reports and product launches [1] - Direxion's suite now includes 55 single-stock ETFs, catering to various market trends and sectors [1]