Revenue Analysis:
Total and Operating Revenue: Over the past three quarters, AMAT’s total and operating revenues have shown variations. In Q4 2023, the revenue was $6.7 billion, which then slightly decreased to $6.6 billion in Q1 2023, and then marginally increased to $6.7 billion in the recent quarter. This indicates a relatively stable revenue stream.
Gross Profit Margins: The gross profit has increased from $2.98 billion in Q1 2023 to $3.09 billion in the next quarter, and $3.20 billion in the most recent quarter, showcasing an increasing trend in gross profitability.
Cost Management:
Cost of Revenue: The cost of revenue was highest in the latest quarter at $3.5 billion compared to $3.54 billion in the previous quarter and $3.46 billion before that. Despite the fluctuations, the cost management needs further scrutiny to enhance margins.
Operating Expense: Operating expenses were recorded at $1.24 billion in the latest quarter, showing an increase from previous quarters ($1.18 billion and $1.17 billion), indicating rising costs associated with operations.
Total Expenses: Total expenses echoed similar trends, reaching $4.74 billion in the recent quarter from $4.72 billion and $4.62 billion in preceding periods, highlighting a slight increment in overall expenditures.
Profitability Analysis:
EBITDA: EBITDA has been improving, moving from $2.00 billion in Q1 2023 to $2.04 billion and then to $2.45 billion in the most recent quarter, showing enhanced operational efficiency and profitability.
Operating Income: Operating income has seen growth, from $1.80 billion in Q1 2023 to $1.91 billion in the next quarter, and reaching $1.97 billion recently, confirming positive profit operations.
Pretax Income: Pretax income also increased from $1.77 billion to $2.17 billion and then to $2.30 billion, indicating good profit before tax over recent periods.
Net Income: Net income shows upward trends too, from $1.57 billion in Q1 2023 to $2.00 billion in Q3, reflecting solid bottom-line growth.
Cash Flow Indicators:
Reconciled Depreciation: Depreciation had slight variations, with $136 million, $130 million, and $91 million recorded over three quarters, which indicate a lowering trend.
Interest Expense: Interest expense remained fairly stable, around $58 million to $60 million over three quarters.
Taxation:
Tax Rate: The tax rate has seen fluctuations, from 13.6% in Q1 2023, reducing to 7.7% in Q3 2023 and then slightly increasing to 12.3% in the most recent quarter.
Tax Provision: Correspondingly, tax provisions were $202 million, $168 million, and $284 million respectively.
Tax Effect of Unusual Items: There has been no impact of unusual items on tax across these periods.
Shareholder Metrics:
Diluted and Basic EPS: EPS values showed growth with $1.86 in Q1 2023, up to $2.38 in the most recent period, the same trend followed in Basic EPS from $1.87 to $2.40 similarly.
Average Shares: The diluted average shares outstanding have been around 842 million to 847 million in reported periods, showing stability in shareholder count.
Net Income Available to Common Stockholders: It has consistently matched the net income figures, indicating all net income is attributed to common shareholders.
Conclusion:
AMAT demonstrates a robust financial position with stable revenue, improving gross profit, and increasing net income. Cost management and expense handling need refinement to enhance margins further. Stable shareholder metrics and effective tax management augur well for maintaining investor confidence.