Applied Materials (NASDAQ: AMAT) traded at 390.09 USD, down 7.49%, on the latest quote as of Oct. 30, 2026, about two weeks before its next earnings report on Nov. 12. The shares sit far below their 52-week high of 739.67 USD. The drop came after a fiscal third quarter (ended July 26, 2026) in which revenue and profit margins both rose. The question for investors is whether a sharp price move reflects a change in the business or a change in how much the market will pay for it.
Figures are current as of Oct. 30, 2026. Quarterly results cover the fiscal third quarter ended July 26, 2026, unless stated otherwise. The Oct. 30 price is the latest quote available to us, not a confirmed closing price.
Key facts
- Latest quote, Oct. 30, 2026: AMAT traded at 390.09 USD, down 7.49%. Its 52-week range is 203.4 to 739.67 USD, so the shares are well below the high, and its market cap is $309.57B.
- Q3 FY2026 (ended July 26, 2026): revenue was $9.12B, higher than a year earlier, and diluted EPS (earnings per share, GAAP) was 3.17 versus 2.21 a year earlier.
- Aug. 13, 2026 report: EPS of 3.5 beat the analyst estimate of 3.4 (a difference of $0.10). Revenue of $9.12B beat the estimate of $8.99B by $120.0M. The 3.5 figure and the GAAP diluted EPS of 3.17 are different measures for the same quarter; the sources we have do not say how they differ.
- Q3 FY2026 cash flow: free cash flow (cash left after capital spending) was $2.33B on operating cash flow of $3.04B.
- Next report, Nov. 12, 2026: analysts expect EPS of 4.06 and revenue of $10.30B.
- Stock Expert AI MoonshotScore V2: 79.7 (Exceptional), with the weakest pillar being valuation.
Revenue rose 24.8% from a year earlier and net income rose 42.7%.
What happened
Shares of the chip-equipment maker were sharply lower on the latest Oct. 30 quote. The headlines we reviewed from that date focused on its fast growth and on comparisons with other AI-linked companies, but none points to company-specific bad news. We found no company announcement or other explanation for the move, so treat any single-day explanation with caution. The evidence also does not show whether peers fell the same day.
The business results the market is weighing are from the quarter reported Aug. 13. Revenue of $9.12B was the highest of the five most recent quarters. Operating income, the profit from running the business before interest and taxes, was $3.08B.
Where the growth came from. Semiconductor Systems, the unit that sells the machines chipmakers use to build chips, brought in $7.04B, up from $5.43B a year earlier. Applied Global Services, which sells maintenance, upgrades and spare parts for machines already installed, brought in $1.78B versus $1.60B. Services grew more slowly, but it is usually steadier because it depends on the installed base of machines rather than on new factory orders. The year-ago quarter also listed a $263.0M Display and Adjacent Markets line, and it does not appear as a separate line in the latest quarter's data we have.
Where customers are. By region, China was the largest at $2.51B, followed by Taiwan at $2.02B, Korea at $1.52B, the United States at $1.37B, Japan at $839.0M, Europe at $483.0M and Southeast Asia at $374.0M. China is the largest single region, which matters for the risks discussed below.
Margins have risen for three straight quarters. The table shows the five most recent quarters, with quarter-end dates as reported by FMP.
| Quarter (ended) | Revenue | Gross margin | Operating margin | Net income | |---|---|---|---|---| | Q3 FY2025 (July 27, 2025) | $7.30B | 48.8% | 30.6% | $1.78B | | Q4 FY2025 (Oct. 26, 2025) | $6.80B | 48.0% | 25.2% | $1.90B | | Q1 FY2026 (Jan. 31, 2026) | $7.01B | 49.0% | 29.9% | $2.03B | | Q2 FY2026 (Apr. 26, 2026) | $7.91B | 49.9% | 31.9% | $2.81B | | Q3 FY2026 (July 26, 2026) | $9.12B | 50.3% | 33.7% | $2.54B |
Gross margin, the share of sales left after the direct cost of making products, rose in each of the last three quarters. Operating margin recovered from its low in the quarter ended Oct. 26, 2025 to its highest point in this period. One detail: net income in the latest quarter was lower than in the quarter ended April 26, 2026, even though revenue and operating income were higher. We did not have a breakdown of the items behind that, so we do not explain it.
Cash flow was uneven. Free cash flow was $2.33B in the latest quarter, compared with just $210.0M in the quarter ended April 26, 2026, when operating cash flow was $845.0M. Quarterly cash flow at equipment makers can swing with customer payments and inventory, so one strong quarter does not set a trend. In the latest quarter the company spent $440.0M on buybacks and $420.0M on dividends. Cash and short-term investments were $9.23B and total debt was $7.35B. Separately, FMP reports net debt of $309.0M; that figure is not calculated from the $9.23B cash and short-term investments figure, and the sources do not reconcile the two.
Why it matters for investors
The business looks strong while the stock looks volatile. With the shares far below their 52-week high of 739.67 USD, the move and the analyst targets below are best read against that range.
Valuation versus peers. On trailing 12-month earnings, AMAT trades at a P/E (price divided by per-share earnings) of 33.43. Its price/sales is 10.04, EV/EBITDA is 26.88, and price/free cash flow is 55.06. Its dividend yield is 0.5%, and its net margin is 30.1%.
| Company | P/E (trailing) | Net margin | |---|---|---| | Applied Materials (AMAT) | 33.43 | 30.1% | | ASML Holding (ASML) | 40.34 | 34.1% | | ASM International (ASMXF) | 35.76 | 26.8% | | BE Semiconductor Industries (BESIY) | 42.42 | 32.9% | | Axcelis Technologies (ACLS) | 33.36 | 10.7% |
AMAT's P/E of 33.43 is below those of ASML (40.34), ASM International (35.76) and BE Semiconductor (42.42), and about level with Axcelis (33.36). Its net margin sits between ASM International and ASML. Axcelis has a similar P/E but a much smaller business and a far lower net margin.
What analysts think. Of 55 ratings, 1 is strong buy, 42 are buy, 12 are hold, and none are sell, for a consensus of "Buy." Analysts' price targets average 659.83 USD with a median of 625.00 USD, a high of 900.00 USD and a low of 530.00 USD. Even the lowest target is above the latest Oct. 30 quote, though targets are opinions that often lag the stock. In the last 30 days, Needham, Evercore ISI Group and RBC Capital each reiterated positive ratings (Oct. 14 to Oct. 16, 2026).
Our MoonshotScore. Stock Expert AI's MoonshotScore V2 for AMAT is 79.7, rated Exceptional. Its sector-relative pillars are quality 87, safety 85, momentum 70, growth 62 and valuation 29. In plain terms, the company scores high for profitability and financial stability and lower for growth, and valuation is the weak spot, meaning the shares are not cheap relative to the sector. Piotroski score (a 0-9 financial health check) is 6 and the Altman Z-score (a bankruptcy-risk gauge where higher is safer) is 14.48.
What could go wrong
- Valuation: a valuation pillar of 29 says investors are already paying a high price for earnings relative to the sector. A high price leaves less room for disappointment.
- China exposure: China was the largest region by revenue in the latest quarter. Changes in export rules or customer spending there can affect results quickly. We did not have the earnings call transcript, so we cannot quote management on this.
- Cyclicality: chip-equipment demand depends on how much chipmakers decide to spend on new factories, and that spending can fall as quickly as it rises. Revenue dropped in the quarter ended Oct. 26, 2025 before the recent rebound.
- Insiders: in the last 90 days, filings we reviewed show 0 open-market purchases and 3 sales. Insider sales are common and have many reasons. We saw no insider buying either, but the data covers only the 30 most recent Form 4 filings, and older filings in the 90-day window may be missing.
- Model signals: a third-party discounted cash flow model returned a negative value per share for AMAT as of Oct. 30. We treat that as a model quirk rather than a useful signal, since it conflicts with the company's positive earnings and cash flow.
What to watch next
- Nov. 12, 2026: the earnings report. Analysts expect EPS of 4.06 and revenue of $10.30B.
- Margins: whether gross and operating margins stay near the latest 50.3% and 33.7%.
- Cash conversion: whether free cash flow stays strong after the swing between the last two quarters.
- Regional mix: whether China stays the largest region and how management describes its outlook there.
- Guidance: management's forecast for the next quarter.
Frequently asked questions
Q: Why did Applied Materials stock fall on Oct. 30, 2026?
The shares traded at 390.09 USD, down 7.49%, on the latest quote as of Oct. 30, 2026. We found no company announcement or other explanation for the drop in the headlines we reviewed. The company's most recent results, reported Aug. 13, were above analyst estimates.
Q: Is Applied Materials expensive compared with other chip equipment stocks?
AMAT's trailing P/E of 33.43 is lower than ASML at 40.34, ASM International at 35.76 and BE Semiconductor at 42.42, and about level with Axcelis at 33.36. Our MoonshotScore valuation pillar is 29, which is weak relative to its sector, so the stock is not cheap relative to its sector even if it is less expensive than some peers.
Q: When does Applied Materials report earnings next, and what is expected?
Applied Materials is scheduled to report on Nov. 12, 2026. Analysts expect EPS of 4.06 and revenue of $10.30B. In its last report on Aug. 13, 2026, it beat estimates for both, with EPS of 3.5 versus 3.4 expected and revenue of $9.12B versus $8.99B.
This is educational content, not investment advice. Past performance does not guarantee future results.