A Dark Vector Cognition product

Item 16. Form 10-K Summary

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Item 16. Form 10-K Summary

None.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors

Applied Materials, Inc.:

Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheets of Applied Materials, Inc. and subsidiaries (the Company) as of October 26, 2025 and October 27, 2024, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended October 26, 2025, and the related notes (collectively, the consolidated financial statements). We also have audited the Company’s internal control over financial reporting as of October 26, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of October 26, 2025 and October 27, 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended October 26, 2025, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of October 26, 2025 based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Evaluation of sufficiency of audit evidence over revenue

As discussed in Notes 1 and 15 to the consolidated financial statements, the Company recorded $28,368 million in net revenue, for the year ended October 26, 2025. The Company generates revenue by providing manufacturing equipment, services and software to customers in the semiconductor, display and related industries. The Company’s process to account for and recognize revenue differs across revenue streams.

We identified the evaluation of the sufficiency of audit evidence obtained over net revenue as a critical audit matter. Evaluating the sufficiency of audit evidence required subjective auditor judgment due to the number of revenue streams and separate processes to account for and recognize revenue. This included determining the nature and extent of audit evidence obtained over each revenue stream.

The following are the primary procedures we performed to address this critical audit matter. We applied auditor judgment to determine the revenue streams over which procedures were performed as well as the nature and extent of such procedures. For revenue streams where procedures were performed, we:

  • evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s revenue recognition processes, including the Company’s controls over the accurate recording of revenue.

  • evaluated the Company’s revenue recognition accounting policies.

  • evaluated, for a sample of revenue transactions, (1) the accounting for consistency with the Company’s accounting policies, as applicable, including timing of revenue recognition, and (2) the recorded amounts by comparing them for consistency to underlying documentation, including the customer contracts.

In addition, we evaluated the sufficiency of audit evidence obtained by assessing the results of the procedures performed, including the appropriateness of the nature and extent of audit effort over revenue

/S/ KPMG LLP
KPMG LLP

We have served as the Company’s auditor since 2004.

Santa Clara, California

December 12, 2025

APPLIED MATERIALS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

Fiscal Year202520242023
Net revenue$28,368$27,176$26,517
Cost of products sold14,56014,27914,133
Gross profit13,80812,89712,384
Operating expenses:
Research, development and engineering3,5703,2333,102
Marketing and selling858836776
General and administrative910961852
Restructuring charges181——
Total operating expenses5,5195,0304,730
Income from operations8,2897,8677,654
Interest expense269247238
Interest and other income (expense), net1,251532300
Income before income taxes9,2718,1527,716
Provision for income taxes2,273975860
Net income$6,998$7,177$6,856
Earnings per share:
Basic$8.71$8.68$8.16
Diluted$8.66$8.61$8.11
Weighted average number of shares:
Basic804827840
Diluted808834845

See accompanying Notes to Consolidated Financial Statements.

APPLIED MATERIALS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

Fiscal Year202520242023
Net income$6,998$7,177$6,856
Other comprehensive income (loss), net of tax:
Change in unrealized gain (loss) on available-for-sale investments184325
Change in unrealized net loss on derivative instruments5331(66)
Change in defined and postretirement benefit plans(13)(25)26
Other comprehensive income (loss), net of tax5849(15)
Comprehensive income$7,056$7,226$6,841

See accompanying Notes to Consolidated Financial Statements.

APPLIED MATERIALS, INC.

CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts)

October 26, 2025October 27, 2024
ASSETS
Current assets:
Cash and cash equivalents$7,241$8,022
Short-term investments1,3321,449
Accounts receivable, net5,1855,234
Inventories5,9155,421
Other current assets1,2081,094
Total current assets20,88121,220
Long-term investments4,3272,787
Property, plant and equipment, net4,6103,339
Goodwill3,7073,732
Purchased technology and other intangible assets, net226249
Deferred income taxes and other assets2,5483,082
Total assets$36,299$34,409
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term debt$100$799
Accounts payable and accrued expenses5,3334,820
Contract liabilities2,5662,849
Total current liabilities7,9998,468
Long-term debt6,4555,460
Income taxes payable356670
Other liabilities1,074810
Total liabilities15,88415,408
Commitments and contingencies (Note 14)
Stockholders’ equity:
Preferred stock: $0.01 par value per share; 1 shares authorized; no shares issued——
Common stock: $0.01 par value per share; 2,500 shares authorized; 793 and 818 shares outstanding at 2025 and 2024, respectively88
Additional paid-in capital10,3339,660
Retained earnings55,22749,651
Treasury stock: 1,241 and 1,211 shares at 2025 and 2024, respectively(45,043)(40,150)
Accumulated other comprehensive loss(110)(168)
Total stockholders’ equity20,41519,001
Total liabilities and stockholders’ equity$36,299$34,409

See accompanying Notes to Consolidated Financial Statements.

APPLIED MATERIALS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions, except per share amounts)

Common StockAdditional Paid-In CapitalRetained EarningsTreasury StockAccumulated Other Comprehensive Income (Loss)Total
SharesAmountSharesAmount
Balance at October 30, 2022844$8$8,593$37,8921,173$(34,097)$(202)$12,194
Net income———6,856———6,856
Other comprehensive income (loss), net of tax——————(15)(15)
Dividends declared ($1.22 per common share)———(1,022)———(1,022)
Share-based compensation——490————490
Net issuance under stock plans7—48————48
Common stock repurchases(18)———18(2,202)—(2,202)
Balance at October 29, 2023833$8$9,131$43,7261,191$(36,299)$(217)$16,349
Net income———7,177———7,177
Other comprehensive income (loss), net of tax——————4949
Dividends declared ($1.52 per common share)———(1,252)———(1,252)
Share-based compensation——577————577
Net issuance under stock plans5—(48)————(48)
Common stock repurchases(20)———20(3,851)—(3,851)
Balance at October 27, 2024818$8$9,660$49,6511,211$(40,150)$(168)$19,001
Net income———6,998———6,998
Other comprehensive income (loss), net of tax——————5858
Dividends declared ($1.78 per common share)———(1,422)———(1,422)
Share-based compensation——660————660
Net issuance under stock plans5—13————13
Common stock repurchases(30)———30(4,893)—(4,893)
Balance at October 26, 2025793$8$10,333$55,2271,241$(45,043)$(110)$20,415

See accompanying Notes to Consolidated Financial Statements.

APPLIED MATERIALS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS — (Continued)

(In millions)

Fiscal Year202520242023
Cash flows from operating activities:
Net income$6,998$7,177$6,856
Adjustments required to reconcile net income to cash provided by operating activities:
Depreciation and amortization435392515
Restructuring charges179——
Deferred income taxes639(633)24
(Gain) loss and impairments on investments, net(792)(15)(16)
Share-based compensation668577490
Other316256
Changes in operating assets and liabilities, net of amounts acquired:
Accounts receivable49(69)903
Inventories(494)304207
Other current and non-current assets(119)287(48)
Accounts payable and accrued expenses307281(138)
Contract liabilities(283)(126)(167)
Income taxes payable250389(20)
Other liabilities905138
Cash provided by operating activities7,9588,6778,700
Cash flows from investing activities:
Capital expenditures(2,260)(1,190)(1,106)
Cash paid for acquisitions, net of cash acquired(29)—(25)
Proceeds from asset sale33——
Proceeds from sales and maturities of investments5,5282,4511,268
Purchases of investments(6,054)(3,588)(1,672)
Cash used in investing activities(2,782)(2,327)(1,535)
Cash flows from financing activities:
Debt borrowings, net of issuance costs991694—
Debt repayments(700)——
Proceeds from commercial paper503401991
Repayments of commercial paper(502)(400)(900)
Proceeds from common stock issuances261243227
Common stock repurchases(4,895)(3,823)(2,189)
Tax withholding payments for vested equity awards(248)(291)(179)
Payments of dividends to stockholders(1,384)(1,192)(975)
Payments of debt issuance costs(3)——
Repayments of principals on finance leases—(102)(7)
Cash used in financing activities(5,977)(4,470)(3,032)
Increase (decrease) in cash, cash equivalents and restricted cash equivalents(801)1,8804,133
Cash, cash equivalents and restricted cash equivalents — beginning of period8,1136,2332,100
Cash, cash equivalents and restricted cash equivalents — end of period$7,312$8,113$6,233
Reconciliation of cash, cash equivalents, and restricted cash equivalents
Cash and cash equivalents$7,241$8,022$6,132
Restricted cash equivalents included in deferred income taxes and other assets7191101
Total cash, cash equivalents, and restricted cash equivalents$7,312$8,113$6,233

APPLIED MATERIALS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS — (Continued)

(In millions)

Fiscal Year202520242023
Supplemental cash flow information:
Cash payments for income taxes$1,504$957$1,006
Cash refunds from income taxes$90$15$53
Cash payments for interest$239$205$205

See accompanying Notes to Consolidated Financial Statements.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 Summary of Significant Accounting Policies and Recently Adopted Accounting Standards

Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of Applied Materials, Inc. and its subsidiaries (we, us, and our) after elimination of intercompany balances and transactions. All references to a fiscal year apply to our fiscal year which ends on the last Sunday in October. Fiscal 2025, 2024 and 2023 each contained 52 weeks. Each fiscal quarter of 2025, 2024 and 2023 contained 13 weeks.

Certain prior-year amounts have been reclassified to conform to current-year presentation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ materially from those estimates. On an ongoing basis, we evaluate our estimates, including those related to standalone selling price (SSP) related to revenue recognition, accounts receivable and sales allowances, fair values of financial instruments, inventories, intangible assets and goodwill, useful lives of intangible assets and property, plant and equipment, fair values of share-based awards, warranty, and income taxes, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

Cash Equivalents

All highly liquid investments with a remaining maturity of three months or less at the time of purchase are classified as cash equivalents. Cash equivalents consist primarily of investments in institutional money market funds, treasury bills and investment grade commercial paper.

Investments

All of our investments, except equity investments, are classified as available-for-sale at the respective balance sheet dates. Investments classified as available-for-sale are measured and recorded in the Consolidated Balance Sheets at fair value, and unrealized gains and losses, net of tax, are reported as a separate component of other comprehensive income. Interest earned on cash and investments, as well as realized gains and losses on sale of securities, are included in interest and other income, net in the Consolidated Statements of Operations.

Our equity investments with readily determinable values consist of publicly traded equity securities. These investments are measured at fair value using quoted prices for identical assets in an active market. Privately held equity investments without readily determinable fair value are measured at cost, less impairment, adjusted by observable price changes. Adjustments resulting from impairments and observable price changes are recorded in interest and other income, net in the Consolidated Statements of Operations.

Investments with remaining effective maturities of 12 months or less from the balance sheet date are classified as short-term investments. Investments with remaining effective maturities of more than 12 months from the balance sheet date are classified as long-term investments.

Fair Value Measurements

Our financial assets are measured and recorded at fair value on a recurring basis, except for equity investments in privately held companies. These equity investments are generally accounted for under the measurement alternative, defined as cost, less impairments, adjusted for subsequent observable price changes and are periodically assessed for impairment when events or circumstances indicate that a decline in value may have occurred. Our nonfinancial assets, such as goodwill, intangible assets, and property, plant and equipment, are recorded at cost and are assessed for impairment at least annually for goodwill, or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable.

We use the following hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

  • Level 1 — Quoted prices in active markets for identical assets or liabilities;

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

  • Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and

  • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

In determining the fair value of our debt securities investments, we use pricing information from pricing services that value securities based on quoted market prices and models that utilize observable market inputs. In the event a fair value estimate is unavailable from a pricing service, we generally obtain non-binding price quotes from brokers. In addition, to validate pricing information obtained from pricing services, we periodically perform supplemental analysis on a sample of securities. We review any significant unanticipated differences identified through this analysis to determine the appropriate fair value. As of October 26, 2025, substantially all of our available-for-sale, short-term, and long-term investments were recognized at fair value that was determined based upon quoted prices or other observable inputs.

Our equity investments with readily determinable values are measured at fair value using quoted prices for identical assets in an active market, and the changes in fair value of these equity investments are recognized in the consolidated statements of operations.

Inventories

Inventories are stated at the lower of cost or net realizable value, with approximate cost determined on a first-in, first-out (FIFO) basis. We adjust inventory carrying value for estimated obsolescence equal to the difference between the cost of inventory and the estimated net realizable value based upon assumptions about future demand and market conditions. We fully write down inventories and noncancelable purchase orders for inventory deemed obsolete. We perform periodic reviews of inventory items to identify excess inventories on hand by comparing on-hand balances to anticipated usage using recent historical activity as well as anticipated or forecasted demand. If estimates of customer demand diminish further or market conditions become less favorable than those projected by us, additional inventory adjustments may be required.

Property, Plant and Equipment

Property, plant and equipment is stated at cost. Depreciation is provided over the estimated useful lives of the assets using the straight-line method. Estimated useful lives of certain assets for financial reporting purposes are as follows: buildings and improvements, 3 to 30 years; demonstration and manufacturing equipment, 5 to 8 years; software, 3 to 5 years; and furniture, fixtures and other equipment, 3 to 5 years. Land improvements are amortized over the shorter of 15 years or their estimated useful life. Leasehold improvements are amortized over the shorter of five years or the lease term.

Government Assistance

We receive government assistance from various domestic and foreign governments in the form of cash grants or refundable tax credits. These arrangements incentivize us to continue growing our capital investments and research and development activities. Government incentives generally contain conditions that must be met in order for the assistance to be earned. We recognize the incentives when there is reasonable assurance that we will comply with all conditions specified in the incentive arrangement and the incentive will be received.

We record capital expenditure related incentives as an offset to the associated property, plant and equipment, net within our Consolidated Balance Sheets and recognize a reduction to depreciation expense over the useful life of the corresponding acquired asset. We record incentives related to operating activities as a reduction to expense in the same line item on the Consolidated Statements of Operations as the expenditure for which the grant is intended to compensate.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Acquisitions

We account for the acquisition of a business using the acquisition method of accounting. Our methodology for allocating the purchase price relating to purchase acquisitions is determined through established and generally accepted valuation techniques. We allocate the fair value of the purchase consideration of our acquisitions to the tangible assets, liabilities, and intangible assets acquired, including in-process technology, based on their estimated fair values. Goodwill is measured as the excess of the purchase price over the sum of the amounts assigned to tangible and identifiable intangible assets acquired less liabilities assumed. We assign assets acquired (including goodwill) and liabilities assumed to one or more reporting units as of the date of acquisition. Typically, acquisitions relate to a single reporting unit and thus do not require the allocation of goodwill to multiple reporting units. If the products obtained in an acquisition are assigned to multiple reporting units, the goodwill is distributed to the respective reporting units as part of the purchase price allocation process. The value assigned to intangible assets is usually based on estimates and judgments regarding expectations for the success and life cycle of products and technology acquired.

Goodwill and Intangible Assets

Goodwill is not amortized but is reviewed for impairment annually during the fourth quarter of each fiscal year and whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The process of evaluating the potential impairment of goodwill requires judgment.

When reviewing goodwill for impairment, we first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. In performing a qualitative assessment, we consider business conditions and other factors including, but not limited to (i) adverse industry or economic trends, (ii) restructuring actions and lower projections that may impact future operating results, (iii) sustained decline in share price, and (iv) overall financial performance and other events affecting the reporting units. If we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then a quantitative impairment test is performed by estimating the fair value of the reporting unit and comparing it to its carrying value. If the carrying value of a reporting unit exceeds its fair value, we would record an impairment charge equal to the excess of the carrying value of the reporting unit over its fair value.

In the fourth quarter of fiscal 2025, we performed a qualitative assessment to test goodwill for all of our reporting units for impairment. Based on this assessment, we determined that a quantitative impairment test was required for certain non-strategic businesses within our Corporate and Other category, primarily due to events related to the exit of one such business during the quarter. As a result, we recognized goodwill impairment charges of $41 million in general and administrative expenses in our Consolidated Statements of Operations. No goodwill impairment was recorded during fiscal 2024 and 2023.

Intangible assets with finite lives are presented at cost, net of accumulated amortization, and are amortized over their estimated useful lives of 1 to 15 years using the straight-line method. We evaluate the useful lives of our intangible assets each reporting period to determine whether events and circumstances require revising the remaining period of amortization. Intangible assets with infinite lives are not subject to amortization and consist primarily of in-process technology, which will be subject to amortization upon commercialization. If an in-process technology project is abandoned, the acquired technology attributable to the project will be written-off. The carrying values of our intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset or asset group may not be recoverable. The balances of our intangible assets were not material as of October 26, 2025 or October 27, 2024 and amortization expenses were not material for fiscal 2025, 2024 and 2023.

Long-Lived Assets

Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset or asset group may not be recoverable. We assess the recoverability of the assets by comparing the undiscounted future cash flow expected to result from the use and eventual disposal of the assets to their respective carrying value. If not recoverable, we recognize an impairment loss to the excess of the carrying value over the fair value of those assets and reduce the carrying value of the assets to their respective fair value. Fair value is determined by available market valuations, when available and appropriate, or by discounted cash flows.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Leases

A contract contains a lease when we have the right to control the use of an identified asset for a period of time in exchange for consideration. We lease certain facilities, vehicles and equipment under non-cancelable operating leases, many of which include options to renew. Options that are reasonably certain to be exercised are included in the calculation of the right-of-use asset and lease liability. Our finance leases are those that contain a purchase option which we are reasonably certain to exercise at the end of the lease term. Our leases do not contain residual value guarantees or significant restrictions that impact the accounting for leases. As implicit rates are not available for the leases, we use the incremental borrowing rate as of the lease commencement date in order to measure the right-of-use asset and liability. Operating lease expense is generally recognized on a straight-line basis over the lease term. Finance lease expense is generally recognized on a straight-line basis over the life of the underlying leased asset.

We elected the practical expedient to account for lease and non-lease components as a single lease component for all leases. For leases with a term of one year or less, we elected not to record a right-of-use asset or lease liability and to account for the associated lease payments as they become due.

A majority of our lease arrangements are operating leases. The balances of our operating leases right-of-use assets and liabilities were not material as of October 26, 2025 or October 27, 2024. Operating lease cost for fiscal 2025, 2024 and 2023 was not material.

Revenue Recognition from Contracts with Customers

We recognize revenue when promised goods or services are transferred to a customer in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. We determine revenue recognition through the following five steps: (1) identification of the contract(s) with customers, (2) identification of the performance obligations in the contract, (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations in the contract, and (5) recognition of revenue when, or as, a performance obligation is satisfied.

Identifying the contract(s) with customers. We sell equipment, services, and spare parts directly to our customers in the semiconductor, display and related industries. We generally consider written documentation including, but not limited to, signed purchase orders, master agreements, and sales orders as contracts provided that collection is probable. Collectability is assessed based on the customer’s creditworthiness determined by reviewing the customer’s published credit and financial information, historical payment experience, as well as other relevant factors.

Identifying the performance obligations. Our performance obligations include delivery of equipment, service agreements, spare parts, installation, extended warranty and training. Our service agreements are considered one performance obligation and may include multiple goods and services that we provide to the customer to deliver against a performance metric. Judgment is used to determine whether multiple promised goods or services in a contract should be accounted for separately or as a group.

Determine the transaction price. The transaction price for our contracts with customers may include fixed and variable consideration. We include variable consideration in the transaction price to the extent that it is probable that a significant reversal of revenue will not occur when the uncertainty associated with the variable consideration is subsequently resolved.

Allocate the transaction price to the performance obligations. A contract’s transaction price is allocated to each distinct performance obligation identified within the contract. We generally estimate the standalone selling price of a distinct performance obligation based on historical cost plus an appropriate margin. For contracts with multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using the relative standalone selling price of each distinct good or service in the contract.

Recognizing the revenue as performance obligations are satisfied. We recognize revenue from equipment and spares parts at a point in time when we have satisfied our performance obligation by transferring control of the goods to the customer, which typically occurs at shipment or delivery. Revenue from service agreements is recognized over time, typically within 12 months, as customers receive the benefits of services.

The incremental costs to obtain a contract are not material.

Payment Terms. Payment terms vary by contract. Generally, the majority of payments are due within a certain number of days from shipment of goods or performance of service. The remainder is typically due upon customer technical acceptance. In certain circumstances we may receive deposits from customers for future deliverables. Our payment terms do not generally contain a significant financing component.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Shipping and Handling Costs

We account for shipping and handling activities related to contracts with customers as costs to fulfill our promise to transfer the associated products. Accordingly, amounts billed for shipping and handling costs are recorded as a component of net revenue and costs as a component of cost of products sold.

Warranty

Our products are generally sold with a warranty for a 12-month period following installation. Parts and labor are covered under the terms of the warranty agreement. We provide for the estimated cost of warranty when revenue is recognized. Estimated warranty costs are determined by analyzing specific product, current and historical configuration statistics and regional warranty support costs. Our warranty obligation is affected by product and component failure rates, material usage and labor costs incurred in correcting product failures during the warranty period. If actual warranty costs differ substantially from our estimates, revisions to the estimated warranty liability would be required. Quarterly warranty consumption is generally associated with sales that occurred during the preceding four quarters, and quarterly warranty provisions are generally related to the current quarter’s sales.

We also sell extended warranty contracts to our customers which provide an extension of the standard warranty coverage period of up to 2 years. We receive payment at the inception of the contract and recognizes revenue ratably over the extended warranty coverage period, as the customer simultaneously receives and consumes the benefits of the extended warranty.

Our warranty reserves balances and the components of changes in our warranty reserves were not material for all periods presented.

Sales and Value Added Taxes

Taxes collected from customers and remitted to governmental authorities are presented on a net basis in the Consolidated Statements of Operations.

Research, Development and Engineering Costs

Research, development and engineering costs are expensed as incurred.

Income Taxes

We recognize a current tax liability for the estimated amount of income tax payable on tax returns for the current fiscal year. Deferred tax assets and liabilities are recognized for the estimated future tax effects of temporary differences between the book and tax bases of assets and liabilities. Deferred tax assets are also recognized for net operating loss and tax credit carryovers. Deferred tax assets are offset by a valuation allowance to the extent it is more likely than not that they are not expected to be realized. Deferred tax assets and liabilities are measured based on enacted tax rates that are expected to apply in the period in which the assets are realized or the liabilities are settled. Deferred tax assets and liabilities are adjusted for the effect of a change in tax rates, laws, or status when the change is enacted.

We recognize tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized from such positions are estimated based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Any changes in judgment related to uncertain tax positions are recognized in our provision for income taxes in the quarter in which such change occurs. Interest and penalties related to uncertain tax positions are recognized in our provision for income taxes.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Derivative Financial Instruments

We use financial instruments, such as foreign currency forward and option contracts, to hedge a portion of, but not all, existing and anticipated foreign currency denominated transactions typically expected to occur within 24 months. The purpose of our foreign currency management is to mitigate the effect of exchange rate fluctuations on certain foreign currency denominated revenues, costs and eventual cash flows. In certain cases, we also use interest rate swap or lock agreements to hedge against the variability of cash flows due to changes in the benchmark interest rate of fixed rate debt. The terms of derivative financial instruments used for hedging purposes are generally consistent with the timing of the transactions being hedged. Our derivative financial instruments are recorded as assets or liabilities at fair value and reported gross on our Consolidated Balance Sheets. However, under master netting agreements in place with our counterparties, we may net settle transactions of the same currency under certain circumstances. For derivative instruments designated and qualifying as cash flow hedges, the gain or loss is reported as a component of accumulated other comprehensive income (loss) (AOCI) in stockholders’ equity and is reclassified into earnings when the hedged transaction affects earnings. Any portion excluded from the assessment of effectiveness is recognized in the same line as the hedged transaction but may be recognized in a different manner, e.g., amortized. If a hedged transaction becomes probable of not occurring according to the original strategy, the hedge relationship is discontinued, and we recognize the gain or loss on the associated derivative in earnings. For hedges of existing foreign currency denominated assets or liabilities, the gain or loss is recorded in earnings in the same period to offset the changes in the fair value of the assets or liabilities being hedged.

Foreign Currency

As of October 26, 2025, all of our subsidiaries use the United States dollar as their functional currency. Accordingly, assets and liabilities of these subsidiaries are remeasured using exchange rates in effect at the end of the period, except for non-monetary assets, such as inventories and property, plant and equipment, which are remeasured using historical exchange rates. Foreign currency-denominated revenues and costs are remeasured using average exchange rates for the period, except for costs related to non-monetary assets and liabilities, which are remeasured using historical exchange rates. The resulting remeasurement gains and losses are included in interest and other income, net in the Consolidated Statements of Operations as incurred.

Concentrations of Credit Risk

Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash equivalents, investments, trade accounts receivable, and derivative financial instruments used in hedging activities. We invest in a variety of financial instruments, such as, but not limited to, commercial paper, corporate bonds, municipal securities, United States Treasury and agency securities, and asset-backed and mortgage-backed securities, and by policy, limit the amount of credit exposure with any one financial institution or commercial issuer. We are exposed to credit-related losses in the event of nonperformance by counterparties to derivative financial instruments but do not expect any counterparties to fail to meet their obligations. We perform ongoing credit evaluations of our customers’ financial condition and generally require no collateral to secure accounts receivable. We maintain an allowance for potentially uncollectible accounts receivable based on our assessment of the collectability of accounts receivable. We regularly review the allowance by considering factors such as historical experience, credit quality, age of the accounts receivable balances, and current economic conditions that may affect a customer’s ability to pay. In addition, we utilize deposits and/or letters of credit to mitigate credit risk when considered appropriate.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Recently Adopted Accounting Standards

Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. In June 2022, the Financial Accounting Standards Board (FASB) issued an accounting standard update which clarifies how the fair value of equity securities subject to contractual sale restrictions is determined (Topic 820). The amendment clarifies that a contractual sale restriction should not be considered in measuring fair value. It also requires certain qualitative and quantitative disclosures related to equity securities subject to contractual sale restrictions. We adopted this authoritative guidance in the first quarter of fiscal 2025. The adoption of this guidance did not have a material impact on our consolidated condensed financial statements.

Improvements to Reportable Segment Disclosures. In November 2023, the FASB issued an accounting standard update to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses (Topic 280). The standard requires interim and annual disclosure of significant segment expenses that are regularly provided to the chief operating decision-maker (CODM) and included within the reported measure of a segment’s profit or loss, requires interim disclosures about a reportable segment’s profit or loss and assets that are currently required annually, requires disclosure of the position and title of the CODM, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss and contains other disclosure requirements. We adopted this authoritative guidance in the fourth quarter of fiscal 2025 and expanded the disclosures in our notes to the consolidated financial statements. See Note 15, Industry Segment Operations, of the Notes to the Consolidated Financial Statements for further information.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 2 Earnings Per Share

Basic earnings per share is determined using the weighted average number of common shares outstanding during the period. Diluted earnings per share is determined using the weighted average number of common shares and potential common shares (representing the dilutive effect of restricted stock units and employees’ stock purchase plan shares) outstanding during the period. Our net income has not been adjusted for any period presented for purposes of computing basic or diluted earnings per share due to our non-complex capital structure.

Fiscal Year202520242023
(In millions, except per share amounts)
Numerator:
Net income$6,998$7,177$6,856
Denominator:
Weighted average common shares outstanding804827840
Effect of weighted dilutive restricted stock units and employees’ stock purchase plan shares475
Denominator for diluted earnings per share808834845
Basic earnings per share$8.71$8.68$8.16
Diluted earnings per share$8.66$8.61$8.11
Potentially weighted dilutive securities———

Excluded from the calculation of diluted earnings per share are securities attributable to outstanding restricted stock units where the combined exercise price and average unamortized fair value are greater than the average market price of our common stock, and therefore their inclusion would be anti-dilutive.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 3 Cash, Cash Equivalents and Investments

Summary of Cash, Cash Equivalents and Investments

The following tables summarize our cash, cash equivalents and investments by security type:

October 26, 2025CostGross Unrealized GainsGross Unrealized LossesEstimated Fair Value
(In millions)
Cash$1,419$—$—$1,419
Cash equivalents:
Money market funds*2,193——2,193
Bank certificates of deposit and time deposits180——180
U.S. Treasury and agency securities1,196——1,196
Municipal securities5——5
Commercial paper, corporate bonds and medium-term notes2,248——2,248
Total cash equivalents5,822——5,822
Total cash and cash equivalents$7,241$—$—$7,241
Short-term and long-term investments:
Bank certificates of deposit and time deposits$4$—$—$4
U.S. Treasury and agency securities1,2293—1,232
Non-U.S. government securities**5——5
Municipal securities4635—468
Commercial paper, corporate bonds and medium-term notes8486—854
Asset-backed and mortgage-backed securities61442616
Total fixed income securities3,1631823,179
Publicly traded equity securities1,28882422,110
Equity investments in privately held companies3427446370
Total equity investments1,630898482,480
Total short-term and long-term investments$4,793$916$50$5,659
Total cash, cash equivalents and investments$12,034$916$50$12,900

*Excludes $71 million of restricted cash equivalents invested in money market funds related to deferred compensation plans.

**Includes Canadian provincial government debt.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

October 27, 2024CostGross Unrealized GainsGross Unrealized LossesEstimated Fair Value
(In millions)
Cash$1,313$—$—$1,313
Cash equivalents:
Money market funds*3,421——3,421
Bank certificates of deposit and time deposits90——90
U.S. Treasury and agency securities1,394——1,394
Municipal securities19——19
Commercial paper, corporate bonds and medium-term notes1,785——1,785
Total cash equivalents6,709——6,709
Total cash and cash equivalents$8,022$—$—$8,022
Short-term and long-term investments:
Bank certificates of deposit and time deposits$13$—$—$13
U.S. Treasury and agency securities1,306—21,304
Non-U.S. government securities**5——5
Municipal securities44122441
Commercial paper, corporate bonds and medium-term notes80342805
Asset-backed and mortgage-backed securities65635654
Total fixed income securities3,2249113,222
Publicly traded equity securities5431855723
Equity investments in privately held companies2555822291
Total equity investments798243271,014
Total short-term and long-term investments$4,022$252$38$4,236
Total cash, cash equivalents and investments$12,044$252$38$12,258

*Excludes $91 million of restricted cash equivalents invested in money market funds related to deferred compensation plans.

**Includes Canadian provincial government debt.

During fiscal 2025, 2024 and 2023, interest income from our cash, cash equivalents and fixed income securities was $406 million, $486 million and $262 million, respectively.

Maturities of Investments

The following table summarizes the contractual maturities of our investments as of October 26, 2025:

CostEstimated Fair Value
(In millions)
Due in one year or less$1,275$1,276
Due after one through five years1,2741,287
No single maturity date*2,2443,096
Total$4,793$5,659

*Securities with no single maturity date include publicly traded and privately held equity securities and asset-backed and mortgage-backed securities.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Gains and Losses on Investments

At October 26, 2025, gross unrealized losses related to our fixed income portfolio were not material. We regularly review our fixed income portfolio to identify and evaluate investments that have indications of possible impairment from credit losses or other factors. Factors considered in determining whether an unrealized loss is considered to be a credit loss include: the significance of the decline in value compared to the cost basis; the financial condition, credit quality and near-term prospects of the investee; and whether it is more likely than not that we will be required to sell the security prior to recovery. Credit losses related to available-for-sale debt securities are recorded as an allowance for credit losses through interest and other income (expense), net. Any additional changes in fair value that are not related to credit losses are recognized in accumulated other comprehensive income (loss).

During fiscal 2025, 2024 and 2023, gross realized gains and losses related to our fixed income portfolio were not material.

During fiscal 2025, 2024 and 2023, we did not recognize material credit losses and the ending allowance for credit losses was not material.

The components of gain (loss) on equity investments recognized in the Consolidated Statements of Operations for each fiscal year were as follows:

202520242023
(In millions)
Publicly traded equity securities
Unrealized gain$887$332$193
Unrealized loss(139)(287)(44)
Realized gain on sales and dividends9159
Realized loss on sales or impairment—(1)(4)
Equity investments in privately held companies
Unrealized gain20315
Unrealized loss(13)(17)(30)
Realized gain on sales and dividends1049
Realized loss on sales or impairment(35)(19)(121)
Total gain (loss) on equity investments, net$821$20$27

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 4 Fair Value Measurements

Assets Measured at Fair Value on a Recurring Basis

The following table presents our fair value hierarchy for our financial assets (excluding cash balances) measured at fair value on a recurring basis:

October 26, 2025October 27, 2024
Level 1Level 2TotalLevel 1Level 2Total
(In millions)
Assets:
Available-for-sale debt security investments
Money market funds*$2,264$—$2,264$3,512$—$3,512
Bank certificates of deposit and time deposits—184184—103103
U.S. Treasury and agency securities2,1093192,4282,684142,698
Non-U.S. government securities—55—55
Municipal securities—473473—460460
Commercial paper, corporate bonds and medium-term notes—3,1023,102—2,5902,590
Asset-backed and mortgage-backed securities—616616—654654
Total available-for-sale debt security investments$4,373$4,699$9,072$6,196$3,826$10,022
Equity investments with readily determinable values
Publicly traded equity securities$2,110$—$2,110$723$—$723
Total equity investments with readily determinable values$2,110$—$2,110$723$—$723
Total$6,483$4,699$11,182$6,919$3,826$10,745

*Amounts as of October 26, 2025 and October 27, 2024 include $71 million and $91 million, respectively, invested in money market funds related to deferred compensation plans. Due to restrictions on the distribution of these funds, they are classified as restricted cash equivalents and are included in deferred income taxes and other assets in the Consolidated Balance Sheets.

We did not have any financial assets measured at fair value on a recurring basis within Level 3 fair value measurements as of October 26, 2025 or October 27, 2024.

Assets and Liabilities without Readily Determinable Values Measured on a Non-recurring Basis

Our equity investments without readily determinable values consist of equity investments in privately held companies. We elected the measurement alternative, defined as cost, less impairments, adjusted for subsequent observable price changes on a prospective basis for certain equity investments without readily determinable fair values and are required to account for any subsequent observable changes in fair value within the statements of operations. These investments are classified as Level 3 within the fair value hierarchy and periodically assessed for impairment when an event or circumstance indicates that a decline in value may have occurred. Impairment losses on equity investments in privately held companies, included in the above table, were not material during fiscal 2025 and 2024 and were $121 million during fiscal 2023. These impairment losses are included in interest and other income (expense), net in the Consolidated Statement of Operations.

Other

The carrying amounts of our financial instruments, including cash and cash equivalents, restricted cash equivalents, accounts receivable, commercial paper notes, and accounts payable and accrued expenses, approximate fair value due to their short maturities. At October 26, 2025, the aggregate principal amount of long-term senior unsecured notes was $6.5 billion, and the estimated fair value was $6.2 billion. At October 27, 2024, the aggregate principal amount of long-term senior unsecured notes was $5.5 billion and the estimated fair value was $5.1 billion. The estimated fair value of long-term senior unsecured notes is determined by Level 2 inputs and is based primarily on quoted market prices for the same or similar issues. See Note 9 of the Notes to the Consolidated Financial Statements for further detail of existing debt.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 5 Derivative Instruments and Hedging Activities

Derivative Financial Instruments

We conduct business in a number of foreign countries, with certain transactions denominated in local currencies, such as the Japanese yen, Israeli shekel, euro and Taiwanese dollar. We use derivative financial instruments, such as foreign currency forward and option contracts, to hedge certain forecasted foreign currency denominated transactions expected to occur typically within the next 24 months. The purpose of our foreign currency management is to mitigate the effect of exchange rate fluctuations on certain foreign currency denominated revenues, costs and eventual cash flows. The terms of currency instruments used for hedging purposes are generally consistent with the timing of the transactions being hedged.

We do not use derivative financial instruments for trading or speculative purposes. Derivative instruments and hedging activities, including foreign exchange and interest rate contracts, are recognized on the balance sheet at fair value. Changes in the fair value of derivatives that do not qualify for hedge accounting treatment are recognized currently in earnings. All of our derivative financial instruments are recorded at their fair value in other current assets or in accounts payable and accrued expenses.

Hedges related to anticipated transactions are designated and documented at the inception of the hedge as cash flow hedges and foreign exchange derivatives are typically entered into once per month. Cash flow hedges are evaluated for effectiveness quarterly. The effective portion of the gain or loss on these hedges is reported as a component of AOCI in stockholders’ equity and is reclassified into earnings when the hedged transaction affects earnings. The majority of the after-tax net income or loss related to foreign exchange derivative instruments included in AOCI at October 26, 2025 is expected to be reclassified into earnings within 12 months. Changes in fair value caused by changes in time value of option contracts designated as cash flow hedges are excluded from the assessment of effectiveness. The initial value of this excluded component is amortized on a straight-line basis over the life of the hedging instrument and recognized in the financial statement line item to which the hedge relates. If the transaction being hedged is probable not to occur, we recognize the gain or loss on the associated financial instrument in the consolidated statement of operations. The amount recognized due to discontinuance of cash flow hedges that were probable of not occurring by the end of the originally specified time period was not material for fiscal years 2025, 2024 or 2023.

Foreign currency forward contracts are generally used to hedge certain foreign currency denominated assets or liabilities. Accordingly, changes in the fair value of these hedges are recorded in earnings to offset the changes in the fair value of the assets or liabilities being hedged.

As of October 26, 2025 and October 27, 2024, the total outstanding notional amount of foreign exchange contracts was $2.3 billion and $2.0 billion, respectively. The fair values of foreign exchange derivative instruments at October 26, 2025 and October 27, 2024 were not material.

The gain (loss) on derivatives in cash flow hedging relationships recognized in AOCI for derivatives designated as hedging instruments were not material for fiscal year 2025, 2024 and 2023.

The effects of derivative instruments, both those designated as cash flow hedges and those that are not designated, on the Consolidated Statements of Operations were not material for fiscal 2025, 2024 and 2023.

Credit Risk Contingent Features

If our credit rating were to fall below investment grade, we would be in violation of credit risk contingent provisions of the derivative instruments discussed above, and certain counterparties to the derivative instruments could request immediate payment on derivative instruments in net liability positions. The aggregate fair value of all derivative instruments with credit-risk related contingent features that were in a net liability position was immaterial as of October 26, 2025 and October 27, 2024.

Entering into derivative contracts with banks exposes us to credit-related losses in the event of the banks’ nonperformance. However, our exposure is not considered material.

Note 6 Accounts Receivable, Net

We have agreements with various financial institutions to sell accounts receivable and discount promissory notes from selected customers. We sell our accounts receivable generally without recourse. From time to time, we also discount letters of credit issued by customers through various financial institutions. The discounting of letters of credit depends on many factors, including the willingness of financial institutions to discount the letters of credit and the cost of such arrangements.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

We sold $501 million, $444 million and $679 million of accounts receivable during fiscal 2025, 2024 and 2023, respectively. We did not discount letters of credit issued by customers in fiscal 2025, 2024 and 2023. There was no discounting of promissory notes in each of fiscal 2025, 2024 and 2023. Financing charges on the sale of receivables and discounting of letters of credit are included in interest expense in the accompanying Consolidated Statements of Operations and were not material for all years presented.

We maintain an allowance for credit losses for estimated losses resulting from the inability of our customers to make required payments. This allowance is based on historical experience, credit evaluations, specific customer collection history and any customer-specific issues we have identified. Changes in circumstances, such as an unexpected material adverse change in a major customer’s ability to meet its financial obligation to us or its payment trends, may require us to further adjust our estimates of the recoverability of amounts due to us. Bad debt expense and any reversals are recorded in marketing and selling expenses in the Consolidated Statement of Operations.

The balances of allowance for credit losses and changes in allowance for credit losses were not material for fiscal 2025, 2024 and 2023.

We sell our products principally to manufacturers within the semiconductor industry. While we believe that our allowance for credit losses is adequate and represents our best estimate as of October 26, 2025, we continue to closely monitor customer liquidity and industry and economic conditions, which may result in changes to our estimates.

Note 7 Contract Balances and Performance Obligations

Contract Assets and Liabilities

Contract assets primarily result from receivables for goods transferred to customers where payment is conditional upon technical sign off and not just the passage of time. Contract liabilities consist of unsatisfied performance obligations related to advance payments received and billings in excess of revenue recognized. Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period.

Contract assets are generally classified as current and are included in Other Current Assets in the Consolidated Balance Sheets. Contract liabilities are classified as current or non-current based on the timing of when performance obligations will be satisfied and associated revenue is expected to be recognized.

Contract balances at the end of each reporting period were as follows:

October 26, 2025October 27, 2024
(In millions)
Contract assets$281$269
Contract liabilities$2,566$2,849

The increase in contract assets during fiscal 2025 was primarily due to an increase in unsatisfied performance obligations related to goods transferred to customers where payment was conditional upon technical sign off.

During fiscal 2025, we recognized revenue of approximately $2.4 billion related to contract liabilities at October 27, 2024. Contract liabilities decreased during fiscal 2025 due to revenue recognized related to contract liabilities at October 27, 2024, partially offset by new billings for products and services for which there were unsatisfied performance obligations to customers, and revenue had not yet been recognized as of October 26, 2025.

There were no credit losses recognized on our accounts receivables and contract assets during fiscal 2025 and 2024.

Performance Obligations

As of October 26, 2025, the amount of remaining unsatisfied performance obligations on contracts, primarily consisting of written purchase orders received from customers, with an original estimated duration of one year or more was approximately $1.7 billion, of which approximately 53% is expected to be recognized within 12 months and the remainder is expected to be recognized within the following 24 months thereafter.

We have elected the available practical expedient to exclude the value of unsatisfied performance obligations for contracts with an original expected duration of one year or less.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 8 Balance Sheet Detail

October 26, 2025October 27, 2024
(In millions)
Inventories
Customer service spares$1,786$1,742
Raw materials2,0071,680
Work-in-process914879
Finished goods
Deferred cost of sales229217
Evaluation inventory474459
Manufactured on-hand inventory505444
Total finished goods1,2081,120
Total inventories$5,915$5,421
October 26, 2025October 27, 2024
(In millions)
Other Current Assets
Prepaid income taxes and income taxes receivable$148$120
Prepaid expenses and other1,060974
$1,208$1,094
Useful LifeOctober 26, 2025October 27, 2024
(In years)(In millions)
Property, Plant and Equipment, Net
Land and improvements$558$492
Buildings and improvements3-302,9302,359
Demonstration and manufacturing equipment5-82,7082,578
Furniture, fixtures and other equipment3-5855782
Construction in progress1,460898
Gross property, plant and equipment8,5117,109
Accumulated depreciation(3,901)(3,770)
$4,610$3,339

Depreciation expense was $389 million, $346 million and $471 million for fiscal 2025, 2024 and 2023, respectively.

October 26, 2025October 27, 2024
(In millions)
Deferred Income Taxes and Other Assets
Non-current deferred income taxes$1,233$2,393
Operating lease right-of-use assets509375
Income tax receivables and other assets806314
$2,548$3,082

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

October 26, 2025October 27, 2024
(In millions)
Accounts Payable and Accrued Expenses
Accounts payable$1,978$1,570
Compensation and employee benefits1,2211,188
Warranty346364
Dividends payable365327
Income taxes payable380535
Operating lease liabilities, current9187
Restructuring reserve165—
Other787749
$5,333$4,820
October 26, 2025October 27, 2024
(In millions)
Other Liabilities
Defined and postretirement benefit plans$151$142
Operating lease liabilities, non-current404259
Other519409
$1,074$810

Government Assistance

Capital expenditure related incentives reduced gross property, plant and equipment, net by $1.2 billion as of October 26, 2025. Contra-depreciation expense was not material in fiscal 2025. Operating incentives recognized as a reduction to research, development and engineering expense was $31 million in fiscal 2025. Capital expenditure related incentives reduced our income taxes payable by $781 million as of October 26, 2025, of which $233 million is in other current assets and $548 million is in deferred income taxes and other assets, in our Consolidated Balance Sheets.

Note 9 Borrowing Facilities and Debt

Revolving Credit Facilities

In September 2025, we entered into a $2.0 billion 364-day committed revolving credit agreement (364-Day Credit Agreement) with a group of banks. The 364-Day Credit Agreement includes a provision under which we may request an increase in the amount of the facility of up to $1.0 billion for a total commitment of no more than $3.0 billion, subject to the receipt of commitments from one or more lenders for any such increase and other customary conditions. The 364-Day Credit Agreement is scheduled to expire in September 2026, provided, however, if any loans are outstanding on the maturity date, we may convert all or part of such loans to term loans that will mature in September 2027, subject to payment of a fee by us and other customary conditions. The 364-Day Credit Agreement provides for unsecured borrowings that bear interest for each advance at one of two rates selected by us, plus an applicable margin, which varies according to our public debt credit ratings.

No amounts were outstanding under the 364-Day Credit Agreement as of October 26, 2025.

In February 2025, we entered into a $2.0 billion committed revolving credit agreement (Five-Year Credit Agreement) with a group of banks. The Five-Year Credit Agreement includes a provision under which we may request an increase in the amount of the facility of up to $500 million for a total commitment of no more than $2.5 billion, subject to the receipt of commitments from one or more lenders for any such increase and other customary conditions. The Five-Year Credit Agreement is scheduled to expire in February 2030, unless extended as permitted under the terms of the agreement. The Five-Year Credit Agreement provides for borrowings that bear interest for each advance at one of two rates selected by us, plus an applicable margin, which varies according to our public debt credit ratings. The Five-Year Credit Agreement replaced our prior $1.5 billion credit agreement, which was scheduled to expire in February 2026.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

No amounts were outstanding under the Five-Year Credit Agreement or under the prior revolving credit agreement as of October 26, 2025 and October 27, 2024, respectively.

In addition, we have revolving credit facilities with Japanese banks pursuant to which we may borrow up to approximately $53 million in aggregate at any time. Our ability to borrow under these facilities is subject to bank approval at the time of the borrowing request, and any advances will be at rates indexed to the banks’ prime reference rate denominated in Japanese yen. As of October 26, 2025 and October 27, 2024, no amounts were outstanding under these revolving credit facilities.

Short-term Commercial Paper

We have a short-term commercial paper program under which we may issue unsecured commercial paper notes up to a total of $4.0 billion. We increased the amount of commercial paper notes we may issue to $4.0 billion in the fourth quarter of fiscal 2025, subsequent to increasing the amount from $1.5 billion to $2.0 billion in the third quarter of fiscal 2025. The proceeds from the issuances of commercial paper are used for general corporate purposes. At October 26, 2025, we had $100 million of commercial paper notes outstanding and recorded as short-term debt with a weighted-average interest rate of 4.07% and maturities of 35 days, and as of October 27, 2024, we had $100 million of commercial paper notes outstanding and recorded as short-term debt with a weighted-average interest rate of 5.06% and maturities of 63 days.

Senior Unsecured Notes

In September 2025, we issued $550 million aggregate principal amount of 4.000% senior unsecured notes due 2031 and $450 million aggregate principal amount of 4.600% senior unsecured notes due 2036, in a registered public offering. In October 2025, we used a portion of the net proceeds from the offering to repay the outstanding $700 million in aggregate principal amount of its 3.900% senior unsecured notes due October 1, 2025. The remaining net proceeds from the issuance of the senior unsecured notes are intended for general corporate purposes.

Debt outstanding as of October 26, 2025 and October 27, 2024 was as follows:

Principal Amount
October 26, 2025October 27, 2024Effective Interest RateInterest Pay Dates
(In millions)
Current portion of long-term debt:
3.900% Senior Notes Due 2025$—$7003.944%April 1, October 1
Total current portion of long-term debt$—$700
Long-term debt:
3.300% Senior Notes Due 2027$1,200$1,2003.342%April 1, October 1
4.800% Senior Notes Due 20297007004.844%June 15, December 15
1.750% Senior Notes Due 20307507501.792%June 1, December 1
4.000% Senior Notes Due 2031550—4.070%January 15, July 15
5.100% Senior Notes Due 20355005005.127%April 1, October 1
4.600% Senior Notes Due 2036450—4.632%January 15, July 15
5.850% Senior Notes Due 20416006005.879%June 15, December 15
4.350% Senior Notes Due 20471,0001,0004.361%April 1, October 1
2.750% Senior Notes Due 20507507502.773%June 1, December 1
6,5005,500
Total unamortized discount(12)(10)
Total unamortized debt issuance costs(33)(30)
Total long-term debt$6,455$5,460

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 10 Restructuring Charges

Fiscal 2025 Restructuring Plan

In the fourth quarter of fiscal 2025, we approved a workforce reduction plan (Fiscal 2025 Restructuring Plan) to position us for continued growth as a more competitive and productive organization and expect approximately 4% of our global workforce to be impacted under this plan. The majority of the charges related to the Fiscal 2025 Restructuring Plan were recognized in the fourth quarter of fiscal 2025 and consist primarily of severance and other employment termination benefits to be paid in cash, and other non-cash related charges.

Restructuring charges related to the Fiscal 2025 Restructuring Plan were as follows:

2025
(In millions)
Severance and other employee-related charges$154
Asset impairments27
Total$181

Changes in restructuring reserves related to the Fiscal 2025 Restructuring Plan described above were as follows:

Restructuring Charges Reserves
(In millions)
Balance as of October 27, 2024$—
Restructuring charges167
Consumption of reserves(2)
Balance as of October 26, 2025$165

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Note 11 Stockholders’ Equity, Comprehensive Income and Share-Based Compensation

Accumulated Other Comprehensive Income (Loss)

Changes in the components of accumulated other comprehensive income (loss) (AOCI), net of tax, were as follows:

Unrealized Gain (Loss) on Investments, NetUnrealized Gain (Loss) on Derivative Instruments Qualifying as Cash Flow HedgesDefined and Postretirement Benefit PlansCumulative Translation AdjustmentsTotal
(In millions)
Balance at October 30, 2022$(75)$(52)$(88)$13(202)
Other comprehensive income (loss) before reclassifications16(44)17—(11)
Amounts reclassified out of AOCI9(22)9—(4)
Other comprehensive income (loss), net of tax25(66)26—(15)
Balance at October 29, 2023$(50)$(118)$(62)$13$(217)
Other comprehensive income (loss) before reclassifications3428——62
Amounts reclassified out of AOCI93(25)—(13)
Other comprehensive income, net of tax4331(25)—49
Balance at October 27, 2024$(7)$(87)$(87)$13$(168)
Other comprehensive income (loss) before reclassifications1758——75
Amounts reclassified out of AOCI1(5)(13)—(17)
Other comprehensive income (loss), net of tax1853(13)—58
Balance at October 26, 2025$11$(34)$(100)$13$(110)

The tax effects on net income of amounts reclassified from AOCI were not material for the fiscal 2025, 2024 and 2023.

Stock Repurchase Program

In March 2025, our Board of Directors approved a common stock repurchase program authorizing $10.0 billion in repurchases, which supplemented the previous $10.0 billion authorization approved in March 2023. At October 26, 2025, approximately $14.0 billion remained available for future stock repurchases under the repurchase program.

The following table summarizes our stock repurchases, including and excluding excise tax, for each fiscal year:

202520242023
(In millions, except per share amounts)
Shares of common stock repurchased302018
Cost of stock repurchased (including excise tax)*$4,893$3,851$2,202
Average price paid per share (including excise tax)*$162.85$190.27$123.63
Cost of stock repurchased (excluding excise tax)$4,853$3,823$2,189
Average price paid per share (excluding excise tax)$161.54$188.87$122.89

(*) Stock repurchase amounts include the 1% surcharge on stock repurchases under the Inflation Reduction Act’s excise tax. This excise tax is recorded in equity and reduces the amount available under the repurchase program, as applicable.

We record common stock repurchased and held as treasury stock under the cost method using the first-in, first-out (FIFO) method. Upon reissuance of treasury stock, amounts in excess of the acquisition cost are credited to additional paid in capital. If we reissue treasury stock at an amount below our acquisition cost and additional paid in capital associated with prior treasury stock transactions is insufficient to cover the difference between the acquisition cost and the reissue price, this difference is recorded against retained earnings.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Dividends

During fiscal 2025, our Board of Directors declared one quarterly cash dividend of $0.40 per share and three quarterly cash dividends of $0.46 per share. During fiscal 2024, our Board of Directors declared one quarterly cash dividend of $0.32 per share and three quarterly cash dividends of $0.40 per share. During fiscal 2023, our Board of Directors declared one quarterly cash dividend of $0.26 per share and three quarterly cash dividends of $0.32 per share. Dividends paid during fiscal 2025, 2024 and 2023 amounted to $1.4 billion, $1.2 billion and $975 million, respectively. We currently anticipate that cash dividends will continue to be paid on a quarterly basis, although the declaration of any future cash dividend is at the discretion of the Board of Directors and will depend on our financial condition, results of operations, capital requirements, business conditions and other factors, as well as a determination by the Board of Directors that cash dividends are in the best interests of our stockholders.

Share-Based Compensation

We have a stockholder-approved equity plan, the Employee Stock Incentive Plan (ESIP), which permits grants to employees of share-based awards, including stock options, stock appreciation rights, restricted stock, restricted stock units, performance share units and performance units. In addition, the plan provides for the automatic grant of restricted stock units to non-employee directors and permits the grant of share-based awards to non-employee directors and consultants. Share-based awards made under the plan may be subject to accelerated vesting under certain circumstances, including in the event of a change in control. In addition, we have an Omnibus Employees’ Stock Purchase Plan (ESPP), which enables eligible employees to purchase our common stock.

We recognized share-based compensation expense related to share-based awards and ESPP shares. The effect of share-based compensation on the results of operations and the related tax benefits for each fiscal year were as follows:

202520242023
(In millions)
Cost of products sold$158$134$180
Research, development, and engineering259219179
Marketing and selling857255
General and administrative16615276
Restructuring charges*(8)——
Total share-based compensation$660$577$490
Income tax benefits recognized$80$73$63

(*) Amount related to modification of share-based awards associated with the Fiscal 2025 Restructuring Plan.

The cost associated with share-based awards is typically recognized over the awards’ service period for the entire award on a straight-line basis, adjusting for estimated forfeitures. However, in the case of share-based awards granted to certain members of senior management that allow for partial accelerated vesting in the event of a qualifying retirement based on age and years of service, the compensation expense is recognized once the individual meets the conditions for a qualifying retirement. We calculate estimated forfeiture rate on an annual basis, based on historical forfeiture activities. The cost associated with share-based awards that include performance and/or market goals, is recognized for each tranche over the service period. The cost of the portion of share-based awards subject to performance goals is recognized based on an assessment of the likelihood that the applicable performance goals will be achieved, and the cost of the portion of share-based awards subject to market goals is recognized based on the assumption of 100% achievement of the goal.

At October 26, 2025, we had $947 million in total unrecognized compensation expense, net of estimated forfeitures, related to grants of share-based awards under the ESIP and shares issued under the ESPP, which will be recognized over a weighted average period of 2.4 years. At October 26, 2025, there were 17 million shares available for grant of share-based awards under the ESIP, and an additional 8 million shares available for issuance under the ESPP.

Stock Options

Stock options are rights to purchase, at future dates, shares of our common stock. There were no stock options granted during fiscal 2025, 2024 and 2023 and no outstanding stock options at the end of fiscal 2025.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Restricted Stock Units, Restricted Stock, Performance Share Units and Performance Units

Restricted stock units are converted into shares of our common stock upon vesting on a one-for-one basis. Restricted stock has the same rights as other issued and outstanding shares of our common stock except these shares generally have no right to dividends and are held in escrow until the award vests. Performance share units and performance units are awards that result in a payment to a grantee, generally in shares of our common stock on a one-for-one basis, if performance goals, market goals and/or other vesting criteria are achieved or the awards otherwise vest. Restricted stock units, restricted stock, performance share units and performance units typically vest over three to four years and vesting is usually subject to the grantee’s continued service with us and, in some cases, achievement of specified performance and/or market goals.

The compensation expense related to share-based awards subject solely to time-based vesting requirements (Service-Based Awards) is determined using the market value of our common stock, adjusted to exclude the present value of expected dividends during the vesting period. The market value of our common stock is calculated using the closing price of our common stock on the date of grant, or if the grant date is not a trading date, the average of the closing prices on the trading dates immediately preceding and following the grant date.

During fiscal 2025, 2024 and 2023, certain members of senior management were granted share-based awards that are subject to the achievement of certain levels of specified market and performance goals, in addition to time-based vesting requirements (Performance-Based Awards). The market goal for Performance-Based Awards granted during fiscal 2025, 2024 and 2023 is targeted levels of total shareholder return (TSR) relative to the TSR of the companies in the Standard & Poor’s 500 Index. The performance goal for Performance-Based Awards granted during fiscal 2025 is non-GAAP economic profit, and the performance goal for awards granted during fiscal 2024 and 2023 is non-GAAP operating margin. Each of the performance goal and market goal is weighted 50% and is measured over a three-year period. The number of Performance-Based Awards that may vest in full after three years ranges from 0% to 200% of the target amount. The awards become eligible to vest only if the goals are achieved and will vest only if the grantee remains employed by us through each applicable vesting date, subject to a qualifying retirement based on age and years of service. The awards provide for a partial vesting based on actual performance at the conclusion of the three-year performance period in the event of a qualifying retirement.

The fair value of the portion of the Performance-Based Awards subject to targeted levels of relative TSR is estimated on the date of grant using a Monte Carlo simulation model. Compensation expense is recognized based upon the assumption of 100% achievement of the TSR goal and will not be reversed even if the threshold level of TSR is never achieved, and is reflected over the service period and reduced for estimated forfeitures.

The fair value of the portion of the Performance-Based Awards subject to targeted levels of non-GAAP economic profit or non-GAAP operating margin is estimated on the date of grant based on the market value of our common stock, adjusted to exclude the present value of expected dividends during the vesting period. The market value of our common stock is calculated using the closing price of our common stock on the date of the grant or, if the grant date is not a trading date, the average of the closing prices on the trading dates immediately preceding and following the grant date. If the performance goals are not met as of the end of the performance period, no compensation expense is recognized and any previously recognized compensation expense is reversed. The expected cost is based on the portion of the awards that is probable to vest and is reflected over the service period and reduced for estimated forfeitures.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The following tables summarize the assumptions used for the valuation of share-based awards for the periods presented:

202520242023
Service-Based Awards and the portion of Performance-Based Awards subject to performance goals:
Grant date market value$138.24 - $223.91$148.39 - $241.26$104.22 - $143.97
Risk-free interest rate3.56% - 4.52%3.48% - 5.37%3.64% - 5.48%
Dividend yield1.18% - 3.48%0.72% - 2.62%0.70% - 3.59%
Fair value$134.61 - $220.09$144.79 - $237.94$102.09 - $141.33
202520242023
Portion of Performance-Based Awards subject to market goals:
Grant date market value$169.08$148.39 - $173.89$109.37
Risk-free interest rate4.10%4.24% - 4.30%4.10%
Dividend yield0.95%0.74% - 0.86%0.95%
Expected volatility42.65%40.99% - 43.35%52.38%
Fair value$183.40$195.32 - $249.37$162.72

A summary of the changes in restricted stock units, restricted stock, performance share units and performance units outstanding under our equity compensation plans during fiscal 2025 is presented below:

SharesWeighted Average Grant Date Fair ValueWeighted Average Remaining Contractual TermAggregate Intrinsic Value
(In millions, except per share amounts)
Non-vested restricted stock units, restricted stock, performance share units and performance units at October 27, 202410$129.31
Granted5$165.66
Vested(5)$126.15
Canceled(1)$139.50
Non-vested restricted stock units, restricted stock, performance share units and performance units at October 26, 20259$148.432.3 years$2,086
Non-vested restricted stock units, restricted stock, performance share units and performance units expected to vest9$148.232.2 years$2,029

At October 26, 2025, 0.7 million additional performance-based awards could be earned based upon achievement of certain levels of specified performance and/or market goals.

A summary of the weighted-average grant date fair value per share of the granted restricted stock units, restricted stock, performance share units and performance units and total fair value vested awards for indicated periods is presented below:

202520242023
(In millions, except per share amounts)
Weighted average grant date fair value per share of awards granted$165.66$149.20$104.00
Total fair value of vested awards$647$527$367

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Omnibus Employees**’** Stock Purchase Plan

Under the ESPP, substantially all employees may purchase our common stock through payroll deductions at a price equal to 85 percent of the lower of the fair market value of our common stock at the beginning or end of each 6-month purchase period, subject to certain limits. Our purchasing cycles began in March and September of each of fiscal 2025, 2024 and 2023. We issued 2 million shares in fiscal 2025 at a weighted average price of $131.75 per share, 2 million shares in fiscal 2024 at a weighted average price of $147.38 per share and 2 million shares in fiscal 2023 at a weighted average price of $87.75 per share, under the ESPP. Compensation expense is calculated using the fair value of the employees’ purchase rights under the Black-Scholes model. Underlying assumptions used in the model are outlined in the following table:

202520242023
ESPP:
Dividend yield1.19%0.82%0.98%
Expected volatility42.0%40.1%39.4%
Risk-free interest rate4.13%5.03%5.29%
Expected life (in years)0.50.50.5
Weighted average estimated fair value$42.04$52.31$35.31

Note 12 Employee Benefit Plans

Employee Bonus Plans

We have various employee bonus plans. A discretionary bonus plan provides for the distribution of a percentage of pre-tax income to our employees who are not participants in other performance-based incentive plans, up to a maximum percentage of eligible compensation. Other plans provide for bonuses to our executives and other key contributors based on the achievement of profitability and/or other specified performance criteria. Charges under these plans for fiscal 2025, 2024 and 2023 were $785 million, $837 million and $702 million, respectively.

Defined Benefit Pension Plans of Foreign Subsidiaries and Other Postretirement Benefits

Several of our foreign subsidiaries have defined benefit pension plans covering substantially all of their eligible employees. Benefits under these plans are typically based on years of service and final average compensation levels. The plans are managed in accordance with applicable local statutes and practices. We deposit funds for certain of these plans with insurance companies, pension trustees, government-managed accounts, and/or accrue the expense for the unfunded portion of the benefit obligation on our Consolidated Financial Statements. Our practice is to fund the various pension plans in amounts sufficient to meet the minimum requirements as established by applicable local governmental oversight and taxing authorities. Depending on the design of the plan, local custom and market circumstances, the liabilities of a plan may exceed the qualified plan assets. The differences between the aggregate projected benefit obligations and aggregate plan assets of these plans have been recorded as liabilities by us and are included in other liabilities and accrued expenses in the Consolidated Balance Sheets. The net funded status and periodic benefit cost were not material for fiscal 2025, 2024 and 2023.

Our investment strategy for our defined benefit plans is to invest plan assets in a prudent manner, maintaining well-diversified portfolios with the long-term objective of meeting the obligations of the plans as they come due. Asset allocation decisions are typically made by plan fiduciaries with input from our international pension committee. Our asset allocation strategy incorporates a sufficient equity exposure in order for the plans to benefit from the expected better long-term performance of equities relative to the plans’ liabilities. We retain investment managers, where appropriate, to manage the assets of the plans. Performance of investment managers is monitored by plan fiduciaries with the assistance of local investment consultants. The investment managers make investment decisions within the guidelines set forth by plan fiduciaries. Risk management practices include diversification across asset classes and investment styles and periodic rebalancing toward target asset allocation ranges. Investment managers may use derivative instruments for efficient portfolio management purposes.

Asset return assumptions are derived based on actuarial and statistical methodologies, from analysis of long-term historical data relevant to the country in which each plan is in effect and the investments applicable to the corresponding plan. The discount rate for each plan was derived by reference to appropriate benchmark yields on high quality corporate bonds, allowing for the approximate duration of both plan obligations and the relevant benchmark yields.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Executive Deferred Compensation Plans

We sponsor two unfunded deferred compensation plans, the Executive Deferred Compensation Plan (Predecessor EDCP) and the 2016 Deferred Compensation Plan (2016 DCP) (formerly known as the 2005 Executive Deferred Compensation Plan), under which certain employees may elect to defer a portion of their following year’s eligible earnings. The Predecessor EDCP was frozen as of December 31, 2004 such that no new deferrals could be made under the plan after that date and the plan would qualify for “grandfather” relief under Section 409A of the Code. The Predecessor EDCP participant accounts continue to be maintained under the plan and credited with deemed interest. The 2016 DCP was originally implemented by us effective as of January 1, 2005, and amended and restated as of October 12, 2015, and is intended to comply with the requirements of Section 409A of the Code. In addition, we also sponsor a non-qualified deferred compensation plan as a result of a previous acquisition. Amounts payable for all plans, including accrued deemed interest, totaled $436 million and $357 million at October 26, 2025 and October 27, 2024, respectively, which were included in other liabilities in the Consolidated Balance Sheets.

Note 13 Income Taxes

The components of income before income taxes for each fiscal year were as follows:

202520242023
(In millions)
U.S.$56$833$1,234
Foreign9,2157,3196,482
Total$9,271$8,152$7,716

The components of the provision for income taxes for each fiscal year were as follows:

202520242023
(In millions)
Current:
U.S.$675$1,254$708
Foreign411366456
State343354
1,1201,6531,218
Deferred:
U.S.382(697)(255)
Foreign78830(61)
State(17)(11)(42)
1,153(678)(358)
Total$2,273$975$860

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

A reconciliation between the statutory U.S. federal income tax rate and our actual effective income tax rate for each fiscal year is presented below:

202520242023
Tax provision at U.S. statutory rate21.0%21.0%21.0%
Effect of foreign operations taxed at various rates(7.3)(7.6)(8.2)
Changes in prior years’ unrecognized tax benefits——(0.2)
Resolutions of prior years’ income tax filings0.2(0.1)(0.1)
Research and other tax credits(1.3)(1.4)(1.6)
Remeasurement of deferred tax assets in Singapore7.1——
Valuation allowance on corporate alternative minimum tax credits4.4——
Other0.40.10.2
Total24.5%12.0%11.1%

Our provision for income taxes and effective tax rate are affected by the geographical composition of pre-tax income which includes jurisdictions with differing tax rates, conditional reduced tax rates and other income tax incentives. It is also affected by events that vary from period to period, such as changes in income tax laws and the resolution of prior years’ income tax filings.

Our effective tax rate for fiscal 2025 was higher than the prior fiscal year primarily due to a $659 million remeasurement of deferred tax assets resulting from new tax incentive agreements in Singapore and the recognition of a $407 million valuation allowance against deferred tax assets related to corporate alternative minimum tax (CAMT) credits. These credits are not expected to be realized as a result of changes in the timing of future tax deductions, following the enactment of the One Big Beautiful Bill Act. No prudent and feasible tax-planning strategies are currently available. The amount of the valuation allowance may be adjusted in future quarters if estimates of future taxable income change.

Our effective tax rate for fiscal 2024 was higher than fiscal 2023 primarily due to lower tax credits in fiscal 2024, partially offset by higher proportion of pre-tax income in lower tax jurisdictions in fiscal 2024.

In the reconciliation between the statutory U.S. federal income tax rate and the effective income tax rate, the effect of foreign operations taxed at various rates represents the difference between an income tax provision at the U.S. federal statutory income tax rate and the recorded income tax provision, with the difference expressed as a percentage of worldwide income before income taxes. This effect is substantially related to the tax effect of pre-tax income in jurisdictions with lower statutory tax rates. The foreign operations with the most significant effective tax rate impact are in Singapore. The statutory tax rate for fiscal 2025 for Singapore is 17%. We have been granted conditional reduced tax rates that expire beginning in fiscal 2030, excluding potential renewal and subject to certain conditions with which we expect to comply. The tax benefits arising from these tax rates were $490 million or $0.61 per diluted share, $393 million or $0.47 per diluted share and $369 million or $0.44 per diluted share for fiscal 2025, 2024 and 2023, respectively.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Deferred tax assets and liabilities are recognized for the estimated future tax effects of temporary differences between the book and tax bases of assets and liabilities. Deferred tax assets are also recognized for net operating loss and tax credit carryovers. Deferred tax assets are offset by a valuation allowance to the extent it is more likely than not that they are not expected to be realized. The components of deferred income tax assets and liabilities were as follows:

October 26, 2025October 27, 2024
(In millions)
Deferred tax assets:
Corporate Alternative Minimum Tax$407$410
Capitalized R&D expenses295217
Allowance for doubtful accounts34
Inventory reserves and basis difference145127
Installation and warranty reserves4270
Intangible assets225977
Accrued liabilities2924
Deferred revenue6172
Tax credits677592
Deferred compensation265261
Share-based compensation3444
Property, plant and equipment192101
Lease liability10472
Other5079
Gross deferred tax assets2,5293,050
Valuation allowance(1,049)(569)
Total deferred tax assets1,4802,481
Deferred tax liabilities:
Right of use assets(105)(76)
Undistributed foreign earnings(26)(23)
Investments(133)—
Total deferred tax liabilities(264)(99)
Net deferred tax assets$1,216$2,382

A valuation allowance is recorded to reflect the estimated amount of net deferred tax assets that may not be realized. Changes in the valuation allowance in each fiscal year were as follows:

202520242023
(In millions)
Beginning balance$569$530$460
Increases4803970
Ending balance$1,049$569$530

At October 26, 2025, we have corporate alternative minimum tax credit carryforwards of $407 million that are carried over until exhausted. We also have state research and development tax credit carryforwards of $677 million, including $624 million of credits that are carried over until exhausted and $42 million that are carried over for 15 years and begin to expire in fiscal 2034. It is more likely than not that all tax credit carryforwards, net of valuation allowance, will be utilized.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

We maintain liabilities for uncertain tax positions. These liabilities involve considerable judgment and estimation and are continuously monitored based on the best information available. Gross unrecognized tax benefits are classified as non-current income taxes payable or as a reduction in deferred tax assets. A reconciliation of the beginning and ending balances of gross unrecognized tax benefits in each fiscal year is as follows:

202520242023
(In millions)
Beginning balance of gross unrecognized tax benefits$544$510$498
Lapses of statutes of limitation(82)——
Increases in tax positions for current year262528
Increases in tax positions for prior years—13—
Decreases in tax positions for prior years(1)(4)(16)
Ending balance of gross unrecognized tax benefits$487$544$510

Tax benefit for interest and penalties on unrecognized tax benefits for fiscal 2025 was $63 million and tax expense for interest and penalties on unrecognized tax benefits for fiscal 2024 and 2023 was $45 million and $34 million, respectively. The income tax liability for interest and penalties for fiscal 2025, 2024 and 2023 was $118 million, $181 million and $136 million, respectively, and was classified as non-current income taxes payable.

Included in the balance of unrecognized tax benefits for fiscal 2025, 2024 and 2023 are $347 million, $397 million, and $386 million, respectively, of tax benefits that, if recognized, would affect the effective tax rate.

Our tax returns remain subject to examination by taxing authorities. These include U.S. returns for fiscal 2015 and later years, and foreign tax returns for fiscal 2011 and later years.

The timing of the resolution of income tax examinations, as well as the amounts and timing of various tax payments that may be part of the settlement process, is highly uncertain. This could cause fluctuations in our financial condition and results of operations. We continue to have ongoing negotiations with various taxing authorities throughout the year, and evaluate all domestic and foreign tax audit issues in the aggregate, along with the expiration of applicable statutes of limitations.

We believe it is reasonably possible that the amount of gross unrecognized tax benefits related primarily to foreign operations could be reduced by approximately $200 million in the next 12 months as a result of the resolution of tax matters or the lapse of statute of limitations.

Note 14 Guarantees, Commitments and Contingencies

Guarantees

In the ordinary course of business, we provide standby letters of credit or other guarantee instruments to third parties as required for certain transactions initiated by either us or our subsidiaries. As of October 26, 2025, the maximum potential amount of future payments that we could be required to make under these guarantee agreements was approximately $350 million. We have not recorded any liability in connection with these guarantee agreements beyond that required to appropriately account for the underlying transaction being guaranteed. We do not believe, based on historical experience and information currently available, that it is probable that any amounts will be required to be paid under these guarantee agreements.

We also have agreements with various banks to facilitate subsidiary banking operations worldwide, including overdraft arrangements, issuance of bank guarantees, and letters of credit. As of October 26, 2025, we have provided parent guarantees to banks for approximately $293 million to cover these arrangements.

Legal Matters

From time to time, we receive notification from third parties, including customers and suppliers, seeking indemnification, litigation support, payment of money or other actions by us in connection with claims made against them. In addition, from time to time, we receive notification from third parties claiming that we may be or are infringing or misusing their intellectual property or other rights. We also are subject to various legal proceedings, government investigations or inquiries, and claims, both asserted and unasserted, that arise in the ordinary course of business. These matters are subject to uncertainties, and we cannot predict the outcome of these matters, or governmental inquiries or proceedings that may occur. Although the outcome of the above-described matters, claims and proceedings cannot be predicted with certainty, we do not believe at this time that any of the above-described matters will have a material effect on our consolidated financial condition or results of operations.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Since 2022, we have received multiple subpoenas from government authorities requesting information relating to certain China customer shipments and export controls compliance, including from the U.S. Department of Justice, the U.S. Commerce Department Bureau of Industry and Security, and the U.S. Securities and Exchange Commission. We also have received subpoenas from the U.S. Department of Justice requesting information related to certain federal award applications and information submitted to the federal government. We are cooperating fully with the U.S. government in these matters. We have continued to receive related subpoenas, as well as requests for information, and may in the future receive additional related subpoenas and requests for information from such or other government authorities. Any such matters are subject to uncertainties, and we cannot predict the outcome, nor reasonably estimate a range of loss or penalties, if any, relating to these matters.

Note 15 Industry Segment Operations

Our two reportable segments are: Semiconductor Systems and Applied Global Services (AGS). The Display operating segment financial results were included in the Corporate and Other category balances below, as management no longer considers the Display operating segment a significant operating segment for separate reporting purposes. Segment information is presented based upon our management organization structure as of October 26, 2025 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to our reportable segments.

The Semiconductor Systems segment includes semiconductor capital equipment to enable materials engineering steps including etch, rapid thermal processing, deposition, chemical mechanical planarization, metrology and inspection, wafer packaging, and ion implantation.

The AGS segment provides integrated solutions to optimize equipment and fab performance and productivity, including spares, upgrades, services, 200 millimeter and other equipment and factory automation software for semiconductor and other products.

Our President and Chief Executive Officer is our chief operating decision-maker (CODM). We derive the segment results directly from our internal management reporting system. The accounting policies we use to derive reportable segment results are substantially the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics including orders, net revenue and operating income. Our CODM regularly reviews segment operating income to evaluate the performance of, and to assign resources to, each of the reportable segments. Actual results are compared to budgeted amounts as part of the CODM’s assessment of each segment’s performance and to make decisions about allocating resources to each segment. Our CODM does not evaluate operating segments using total asset information.

The Corporate and Other category includes revenues, costs of products and operating expenses from other operating segments that do not meet the requirements for a reportable segment. Corporate and Other also includes certain corporate function operating expenses that are not allocated to our reportable segments and are managed separately at the corporate level. In addition, we do not allocate to our reportable segments charges associated with restructuring actions, such as employee severance costs and asset impairment charges, unless the restructuring actions pertain to a specific reportable segment. Segment operating income also excludes interest income/expense and other financial charges and income taxes. Our CODM does not consider the unallocated costs in measuring the performance of the reportable segments.

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Information for each reportable segment for and as of the end of each fiscal year were as follows:

Semiconductor SystemsApplied Global ServicesCorporate and OtherTotal
(In millions, except percentages)
2025:
Net revenue$20,798$6,385$1,185$28,368
Costs of products sold9,5304,25177914,560
Gross profit$11,268$2,134$406$13,808
Gross margin54.2%33.4%48.7%
Operating expenses:
Research, development and engineering3,0421264023,570
Selling, general and administrative8472167051,768
Restructuring charges——181181
Operating income (loss)$7,379$1,792$(882)$8,289
Operating margin35.5%28.1%29.2%
Depreciation and amortization$192$26$217$435
Capital expenditures$507$57$1,696$2,260
Accounts receivable$3,733$1,269$183$5,185
Inventories$3,444$2,301$170$5,915
Goodwill$2,476$1,032$199$3,707
Semiconductor SystemsApplied Global ServicesCorporate and OtherTotal
(In millions, except percentages)
2024
Net revenue$19,911$6,225$1,040$27,176
Costs of products sold9,3794,08881214,279
Gross profit$10,532$2,137$228$12,897
Gross margin52.9%34.3%47.5%
Operating expenses:
Research, development and engineering2,6841144353,233
Selling, general and administrative8672117191,797
Operating income (loss)$6,981$1,812$(926)$7,867
Operating margin35.1%29.1%28.9%
Depreciation and amortization$168$22$202$392
Capital expenditures$425$35$730$1,190
Accounts receivable$3,816$1,297$121$5,234
Inventories$2,988$2,306$127$5,421
Goodwill$2,460$1,032$240$3,732

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Semiconductor SystemsApplied Global ServicesCorporate and OtherTotal
(In millions, except percentages)
2023
Net revenue$19,698$5,732$1,087$26,517
Costs of products sold9,4563,91176614,133
Gross profit$10,242$1,821$321$12,384
Gross margin52.0%31.8%46.7%
Operating expenses:
Research, development and engineering2,5441014573,102
Selling, general and administrative8191916181,628
Operating income (loss)$6,879$1,529$(754)$7,654
Operating margin34.9%26.7%28.9%
Depreciation and amortization$235$31$249$515
Capital expenditures$381$39$686$1,106
Accounts receivable$3,943$1,111$111$5,165
Inventories$3,433$2,073$219$5,725
Goodwill$2,460$1,032$240$3,732

Semiconductor Systems revenue is recognized at a point in time. AGS revenue is recognized at a point in time for tangible goods such as spare parts and equipment, and over time for service agreements. The majority of revenue recognized over time is recognized within 12 months of the contract inception.

During fiscal 2025, goodwill decreased primarily due to impairment charges recognized during the fourth quarter of fiscal 2025, partially offset by an increase related to preliminary purchase accounting for an acquisition which was not material to our results of operations or to our balance sheet.

During fiscal 2025, two customers accounted for approximately 19% and 15%, respectively, of our net revenue. During fiscal 2024, two customers accounted for approximately 12% and 11%, respectively, of our net revenue. During fiscal 2023, two customers accounted for approximately 19% and 15%, respectively, of our net revenue.

Net revenue for Semiconductor Systems by market for the periods indicated were as follows:

202520242023
Foundry, logic and other67%68%77%
Dynamic random-access memory (DRAM)26%28%17%
Flash memory (NAND)7%4%6%
100%100%100%

APPLIED MATERIALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

For geographical reporting, revenue by geographic location is determined by the location of customers’ facilities to which products were shipped and services were performed. Long-lived assets consist primarily of property, plant and equipment and right-of-use assets and are attributed to the geographic location in which they are located. Net revenue and long-lived assets by geographic region for and as of each fiscal year were as follows:

202520242023
(In millions)
Net revenue:
United States$3,063$3,818$4,006
China8,52910,1177,247
Korea5,6084,4934,609
Taiwan6,8574,0105,670
Japan2,2732,1542,075
Europe9621,4432,152
Southeast Asia1,0761,141758
Total outside United States25,30523,35822,511
Consolidated total$28,368$27,176$26,517
October 26, 2025October 27, 2024
(In millions)
Long-lived assets:
United States$5,071$3,759
China83
Korea99
Taiwan6759
Japan67
Europe155113
Southeast Asia215
Total outside United States266196
Consolidated total$5,337$3,955

INDEX TO EXHIBITS

These Exhibits are numbered in accordance with the Exhibit Table of Item 601 of Regulation S-K:

Incorporated by Reference
Exhibit No.DescriptionFormFile No.Exhibit No.Filing Date
3.1Amended and Restated Certificate of Incorporation of Applied Materials, Inc., as amended and restated through March 16, 20208-K000-069203.13/16/2020
3.2Amended and Restated Bylaws of Applied Materials, Inc., as amended and restated through December 8, 20238-K000-069203.212/13/2023
4.1Indenture, dated June 8, 2011, by and between Applied Materials, Inc. and U.S. Bank National Association, as Trustee8-K000-069204.16/10/2011
4.2First Supplemental Indenture, dated June 8, 2011, by and between Applied Materials, Inc. and U.S. Bank National Association, as Trustee8-K000-069204.26/10/2011
4.3Second Supplemental Indenture, dated September 24, 2015, by and between Applied Materials, Inc. and U.S. Bank National Association, as Trustee8-K000-069204.19/24/2015
4.4Third Supplemental Indenture, dated March 31, 2017, by and between Applied Materials, Inc. and U.S. Bank National Association, as Trustee8-K000-069204.13/31/2017
4.5Fourth Supplemental Indenture dated May 29, 2020, by and between Applied Materials, Inc. and U.S. Bank National Association8-K000-069204.15/29/2020
4.6Description of Registrant’s Securities Registered Under Section 12 of the Securities Exchange Act of 193410-K000-069204.612/15/2023
4.7Indenture, dated as of June 11, 2024, by and between Applied Materials, Inc. and The Bank of New York Mellon Trust Company, N.A.8-K000-069204.16/11/2024
4.8Supplemental Indenture, dated as of June 11, 2024, by and between Applied Materials, Inc. and The Bank of New York Mellon Trust Company, N.A.8-K000-069204.26/11/2024
4.9Second Supplemental Indenture, dated as of September 18, 2025, by and between Applied Materials, Inc. and The Bank of New York Mellon Trust Company, N.A8-K000-069204.19/19/2025
10.1Form of Indemnification Agreement between Applied Materials, Inc. and Directors and certain officers10-Q000-0692010.15/23/2024
10.2Applied Materials, Inc. Profit Sharing Scheme (Ireland)S-8333-450114.11/27/1998
10.3*Applied Materials Inc. Employee Financial Assistance Plan, amended and restated as of December 18, 200810-Q000-0692010.583/3/2009
10.4Deed of Amendment to Applied Materials Profit Sharing Scheme, dated February 7, 2006, to amend Clause 20 of the Trust Deed thereunder10-K000-0692010.4812/12/2008
10.5Deed of Amendment to Applied Materials Profit Sharing Scheme, dated February 7, 2006, to amend the definition of Eligible Employee in the First Schedule to the Trust Deed thereunder.10-K000-0692010.4912/12/2008
10.6*Form of Restricted Stock Unit Agreement for use under the amended and restated Applied Materials, Inc. Employee Stock Incentive Plan10-Q000-0692010.35/27/2021
10.7*Form of Restricted Stock Unit Agreement for Nonemployee Directors for use under the amended and restated Applied Materials, Inc. Employee Stock Incentive Plan10-Q000-0692010.45/27/2021
10.8*Form of Restricted Stock Agreement for use under the amended and restated Applied Materials, Inc. Employee Stock Incentive Plan10-Q000-0692010.38/23/2012
Incorporated by Reference
Exhibit No.DescriptionFormFile No.Exhibit No.Filing Date
10.9*Applied Materials, Inc. Omnibus Employees’ Stock Purchase Plan, effective September 1, 20218-K000-0692010.23/16/2021
10.10*Offer Letter, dated August 14, 2013, between Applied Materials, Inc. and Gary E. Dickerson10-Q000-0692010.28/22/2013
10.11*Form of Non-Qualified Stock Option Agreement for Employees for use under the Applied Materials, Inc. Employee Stock Incentive Plan, as amended10-Q000-0692010.48/22/2013
10.12*Form of Performance Unit Agreement for use under the Applied Materials, Inc. Employee Stock Incentive Plan, as amended10-Q000-0692010.22/20/2014
10.13*Applied Materials, Inc. Applied Incentive Plan, amended and restated effective September 7, 202310-K000-0692010.1312/15/2023
10.14*Applied Materials, Inc. 2016 Deferred Compensation Plan, as amended and restated on January 1, 202110-K000-0692010.1512/16/2022
10.15*Applied Materials, Inc. Employee Stock Incentive Plan, as amended and restated effective March 11, 20218-K000-0692010.13/16/2021
10.16*Applied Materials, Inc. Senior Executive Bonus Plan, as amended and restated effective September 8, 202310-K000-0692010.1612/15/2023
10.17*Form of Performance Share Unit Agreement for members of the Executive Staff for use under the amended and restated Applied Materials, Inc. Employee Stock Incentive Plan10-K000-0692010.1712/15/2023
10.18*Form of Restricted Stock Unit Agreement for members of the Executive Staff for use under the amended and restated Applied Materials, Inc. Employee Stock Incentive Plan10-K000-0692010.1812/15/2023
10.19*Offer Letter, dated February 26, 2022, between Applied Materials, Inc. and Brice Hill10-Q000-0692010.15/26/2022
10.20Credit Agreement, dated as of February 24, 2025, among Applied Materials, Inc., Bank of America, N.A., as administrative agent, and the other lenders named therein8-K000-0692010.12/27/2025
10.21Credit Agreement, dated as of September 25, 2025, among Applied Materials, Inc., Bank of America, N.A., as administrative agent, and the other lenders named therein8-K000-0692010.19/26/2025
10.22Deed of Amendment, dated December 19, 2023, to the Trust Deed Constituting the Applied Materials Profit Sharing Scheme10-Q000-0692010.12/27/2024
19.1Insider Trading Policy10-K000-0692019.112/13/2024
21Subsidiaries of Applied Materials, Inc.†
23Consent of Independent Registered Public Accounting Firm, KPMG LLP†
24Power of Attorney (included on the signature page of this Annual Report on Form 10-K)†
31.1Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002†
31.2Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002†
32.1Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002‡
32.2Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002‡
97.1Applied Materials, Inc. Compensation Recovery Policy, adopted on September 7, 202310-K000-0692097.112/15/2023
101.INSXBRL Instance Document‡
101.SCHXBRL Taxonomy Extension Schema Document‡
101.CALXBRL Taxonomy Extension Calculation Linkbase Document‡
Incorporated by Reference
Exhibit No.DescriptionFormFile No.Exhibit No.Filing Date
101.DEFXBRL Taxonomy Extension Definition Linkbase Document‡
101.LABXBRL Taxonomy Extension Label Linkbase Document‡
101.PREXBRL Taxonomy Extension Presentation Linkbase Document‡
104Cover Page Interactive Data File (formatted as inline XBRL)
*Indicates a management contract or compensatory plan or arrangement, as required by Item 15(a)(3).
†Filed herewith.
‡Furnished herewith.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

APPLIED MATERIALS, INC.
By:/s/ GARY E. DICKERSON
Gary E. Dickerson
President, Chief Executive Officer

Dated: December 12, 2025

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Gary E. Dickerson, Brice Hill and Teri Little, jointly and severally, his or her attorneys-in-fact, each with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

TitleDate
/s/ GARY E. DICKERSONPresident, Chief Executive Officer and Director (Principal Executive Officer)December 12, 2025
Gary E. Dickerson
/s/ BRICE HILLSenior Vice President, Chief Financial Officer (Principal Financial Officer)December 12, 2025
Brice Hill
/s/ ADAM SANDERSVice President, Corporate Controller and Chief Accounting Officer (Principal Accounting Officer)December 12, 2025
Adam Sanders
/S/ THOMAS J. IANNOTTI
Thomas J. IannottiChairman of the BoardDecember 12, 2025
/S/ JAMES R. ANDERSON
James R. AndersonDirectorDecember 12, 2025
/S/ RANI BORKAR
Rani BorkarDirectorDecember 12, 2025
/S/ JUDY BRUNER
Judy BrunerDirectorDecember 12, 2025
/S/ XUN CHEN
Xun ChenDirectorDecember 12, 2025
/S/ AART J. DE GEUS
Aart J. de GeusDirectorDecember 12, 2025
/S/ ALEXANDER A. KARSNER
Alexander A. KarsnerDirectorDecember 12, 2025
/S/ KEVIN P. MARCH
Kevin P. MarchDirectorDecember 12, 2025
/s/ SCOTT A. MCGREGOR
Scott A. McGregorDirectorDecember 12, 2025

Previous: Item 15. Exhibits, Financial Statement Schedules