Applied Materials vs. Intel: Which Technology Stock Is a Better Buy in 2026?

When comparing Applied Materials (AMAT) and Intel (INTC) as potential technology stock investments for 2026, it is essential to analyze various aspects of each company's financial performance, market position, and strategic partnerships. Applied Materials, a supplier of equipment and services to the semiconductor industry, reported a fiscal year ending in late October 2025, generating nearly $28.4 billion in revenue, up about 4.4% from the prior year.

The company's net income was close to $7.0 billion, resulting in a net margin of roughly 24.7%. However, a dip in net margin occurred due to a significant increase in income tax provisions, which more than doubled to $2.3 billion. Despite the challenges, Applied Materials' latest quarter showed a 25% revenue increase to $9.1 billion and a 43% net income growth to $2.5 billion.

The company returned $860 million to shareholders through share repurchases and dividends. Its debt-to-equity ratio stands at approximately 0.3x, and its current ratio is roughly 2.4x, indicating a strong ability to cover short-term obligations. Applied Materials has recently announced innovation partnerships with Taiwan Semiconductor Manufacturing (TSM) and Intel at their respective centers.

This collaboration highlights their commitment to developing technologies for AI chips and next-generation transistors, signaling a forward-looking approach and potential growth opportunities.

On the other hand, Intel, an integrated device manufacturer, designs and manufactures its own processors for PCs and data centers. Intel's fiscal year concludes in late December 2025, with revenue of about $52.9 billion, down nearly 0.5% from the previous year. Despite the slight revenue decline, Intel managed to report a net loss attributable to Intel of $267 million, resulting in a net margin of roughly -0.5%.

The company's focus remains on returning to profitability while managing its large manufacturing footprint. Intel's debt-to-equity ratio is approximately 0.6x, while its current ratio is approximately 1.6x as of June 27, 2026. However, Intel's financial performance in 2026 has been mixed, with a significant non-cash loss from changes in the fair value of shares held in escrow under the U.S. government agreement.

Despite this setback, Intel's revenue rose 25% in the second quarter of 2026 to $16.1 billion, and they guided to further revenue growth for the third quarter. Intel's gross cash flow remains a concern, with an operating cash flow of $9.7 billion falling short of the $14.6 billion spent on property, plant, and equipment, resulting in negative free cash flow of about $4.9 billion.

Despite these challenges, Intel's stock has attracted significant government investment, with a 433.3 million share purchase, and a warrant for an additional 5% stake, indicating potential long-term value and stability.