Applied Materials Inc. (AMAT)

Applied Materials — The Hidden Infrastructure Behind the AI Revolution

Every time you hear about the latest AI chip from NVIDIA, AMD, or Google — every H100, MI300X, or TPU that powers modern artificial intelligence — there is one name that is rarely mentioned but cannot be absent: Applied Materials Inc. (AMAT).

AMAT does not make chips. The company makes the machines used by chipmakers to manufacture those chips. In the industry, this role is called semiconductor equipment — and AMAT is the undisputed global leader in this category.

Founded in 1967 in Santa Clara, California, Applied Materials now commands a market cap of approximately USD $354 billion, with annual revenue exceeding USD $28 billion. The company operates across three primary segments:

Business Segments

Semiconductor Systems — The Core Growth Engine

This segment is AMAT's primary revenue driver. Products in this category include:

• Deposition (CVD, ALD, PVD) — Depositing thin layers of material onto silicon wafers. AMAT is the global number one in this category.
• Etch — Carving circuit patterns into wafers.
• CMP (Chemical Mechanical Planarization) — Polishing wafer surfaces to atomic-level smoothness.
• Ion Implantation — Embedding specific atoms to modify the electrical properties of materials.
• Advanced Packaging — AMAT is global number one in advanced packaging, particularly HBM stacking and CoWoS technology critical for AI chips.
• Metrology & Inspection — Wafer quality measurement and inspection systems.

Applied Global Services (AGS) — The Recurring Revenue Engine

AGS provides service, spare parts, and upgrade packages for AMAT equipment already installed at customer fabs. In Q1 FY2026, AGS recorded a record $1.56 billion in revenue, up +15% YoY. Starting Q1 FY2026, AGS was restructured to focus exclusively on subscription-like recurring revenue streams.

Key Customers

AMAT serves the biggest names in the global semiconductor industry:

• TSMC — The world's largest contract chipmaker (Taiwan)
• Samsung — Korea's largest chip and memory manufacturer
• SK Hynix — Primary supplier of HBM memory for NVIDIA
• Intel — US semiconductor giant
• Micron — Largest US-based DRAM/NAND manufacturer

Shariah Compliance Status

For Muslim investors, this is good news: Applied Materials Inc. has been verified as Shariah compliant by Zoya under AAOIFI standards. This means the company's core business is free from prohibited activities, and the ratios of interest-bearing debt and investments in impermissible activities are within limits accepted by Islamic finance standards.

✅ Status: SHARIAH COMPLIANT (Zoya AAOIFI Verified)

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