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Applied Materials Incorporated issues the financial report of the first quarter of 2015.

From: economic daily

As a globalleading company providing semi-conductor, two-dimensional display and precisionmaterials engineering solution for solar Industry, Applied MaterialsIncorporated declared the financial report of the first quarter of 2015 up toJanuary 25.

Orders of thefirst quarter of Applied Materials Incorporated were 2.27 billion U.S. dollarswith a 1% increase than the provisos quarter and a decrease of 1% compared withthe same period of last year. The business revenue was 2.36 billion U.S.dollars with an increase of 4% than the previous quarter and a year-on-yearincrease of 8%.

The gross profitrate is 42.3% after non-generally accepted accounting principles (GAAP)adjustment. The operating profit was 447 million U.S. dollars afternon-generally accepted accounting principles (GAAP) adjustment and net profitwas 338 U.S. dollars. Diluted EPS (earning per share) was 0.27 U.S. dollars.The GAAP gross profit rate of the first quarter of the company was 40.7% andGAAP operating profit was 458 million U.S. dollars and the net profit was 348million U.S. dollars. Diluted EPS (earning per share) was 0.28 U.S. dollars.Gary Dickerson, the president and Chief Executive Officer of Applied MaterialsIncorporated expressed, “the main technical turning point of semi-conductor anddisplay created a lot of opportunities for growth for products and services ofprecision material project of Applied Materials Incorporated. Concentration andexecutive force enables us to accumulate experience constantly and step towardslong-term goal. The progress will quicken our merging plans with TokyoElectron”.

Quarterlyfinancial report

The financialreport of Applied Materials Incorporated after non-generally acceptedaccounting principles (GAAP) adjustment includes possible influence offollowing factors (if applicable): some cost relevant to merging, corporaterestructuring expenditure and relevant adjustment, reduction of assets,goodwill and investment, loss of strategic investment or profit from disposalof workshops and relevant tax items. Refer to the financial report attachedbelow for detailed explanation for GAAP and non-GAAP adjustment and the“application of financial methods after non-GAAP adjustment”.  

Comparison offinancial report of the first quarter and previous report of all businessgroups.

The order ofsemi-conductor business group (SSG) was 1.43 billion U.S. dollars with anincrease of 7% than last quarter. As orders of DRAM, flash memory increased andthat for wafer foundry, logical memory and other orders reduced, businessrevenue showed a slight increase of 1% and reached 1.45 billion U.S. dollars.After non-GAAP adjustment, the operating profit reduced by 1% slightly and was350 million U.S. dollars and 24.2% of the business revenue. GAAP operating profitwas increased by 1% slightly and reached 307 million U.S. dollars. It was 21.2%of the business revenue. The newly added orders include: wafer foundry 34%,DRAM 34%, flash memory 18%, logic and other parts 14%.

The orders ofApplied Materials global service group (AGS) were 690 million U.S. dollars thatwas the second high in history of the business group. It was reduced by 8%compared with the new historical high of the previous quarter. The main reasonwas reduction of order for semi-conductor service and 8″equipment. The businessrevenue reached 583 million U.S. dollar, showing a decrease of 2% than theprevious quarter. Operating profit was increased by 5% after non GAAPadjustment and reached 154 million U.S. dollars and was 26.2% of the businessrevenue. The Operating profit was increased by 5% after GAAP adjustment and was26.2% of the business revenue. 

The orders ofdisplay business group were 107 million U.S. dollars, showing a decrease of 18%than the previous quarter. It indicated that order for TV set reduced. Thebusiness revenue was increased by 45% and reached 275 million U.S. dollars.After non-GAAP adjustment, the operating profit increased by 40%, reaching 73million U.S. dollars and accounting for 26.5% of the business revenue. AfterGAAP adjustment, the operating profit increased by 38% and reached 72 millionU.S. dollars, accounting for 26.2% of the business revenue.

The orders ofEnergy and environmental protection business group (EES) increased by 14% andwere 50 million U.S. dollars. The business revenue was increased by 15% andreached 55 million U.S. dollars. Operating loss after non-GAAP adjustment ofthe business group was 3 million U.S. dollars. And GAAP operating loss was 4million U.S. dollars.

The back orderswere reduced by 5% than the previous quarter and reached 2.78 billion U.S.dollars including negative adjustment figure 53 million U.S. dollars. It wasmainly caused by exchange rate adjustment. Back order distributed in businessgroups: semi-conductor system business group 49%, Applied Materials globalservice group (AGS) 30%, display business group 15% and Energy andenvironmental protection business group 6%.

BusinessPerspective 

Look forward tothe second quarter of 2015 account year, Applied Materials Incorporatedpredicts that the business revenue will hold the line or show an increase ofseveral percentage points. After non-GAAP adjustment, diluted EPS (earning pershare) is between 0.26 to 0.30 U.S. dollars. Business prospective does notinclude the relevant expenses of 0.03 U.S. dollars per share caused bycompleted merging. The business prospective also includes other non GAAP adjustmentamount after the financial report is issued.

Application of nonGAAP financial methods

Managers applynon-GAAP financial report to assess operating and financial performance of thecompany. This follows the enterprise goal and enterprise planning principle.The financial evaluation is not consistent with GAAP or may differ fromnon-GAAP method stated in account and financial reports of other companies.Applied Materials Incorporated believes that these evaluations are helpful forinvestors to examine operating ability of the company with the opinion same tothat of managers and enhances the comparison of investors for figures infinancial reports of adjacent periods. The additional information does notreplace financial report that complies with GAAP.



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