Applied Materials Sees Another Record Year in 2027

Applied Materials, Inc. (NASDAQ:AMAT) reported strong fourth-quarter results, anticipating another record year driven by surging demand for artificial intelligence. The company expects global cloud capital spending to exceed $1 trillion in 2027, with the rapid expansion of AI infrastructure fueling demand for advanced chips and semiconductor manufacturing equipment. Applied Materials' monthly AI token consumption grew over 50-fold in 2026, indicating continued growth in 2027.

The semiconductor equipment maker's revenue for the fourth quarter reached $10.41 billion, surpassing analysts' estimate of $10.30 billion. Adjusted earnings of $4.16 per share also exceeded expectations of $4.05. For the first quarter of fiscal 2027, Applied Materials anticipates revenue of $11.1 billion, plus or minus $500 million, which is above the $10.89 billion estimate from analysts.

Management projects semiconductor systems revenue to rise 69% to approximately $8.7 billion in 2027, while Applied Global Services revenue is expected to grow 28% to a record $2 billion. The wafer fabrication equipment (WFE) market is anticipated to grow more than 30% in 2027, driven by demand for advanced chips, high-bandwidth memory, and sophisticated packaging technology.

Applied Materials expects Semiconductor Systems revenue to increase more than 40% in calendar 2026, with advanced packaging revenue projected to grow about 90% during the same period. The company aims to gain more than 2 percentage points of WFE market share by 2030, focusing on faster production, earlier equipment deliveries, and expanded market share in key semiconductor markets.

While China revenue is expected to increase in fiscal 2027, shipments to the region are likely to account for less than 25% of the company's business.