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Applied Materials Enjoys Strong Q3 and Outlooks Stronger Q4
December 03, 2017

Applied Materials reported record revenue and earnings throughout fiscal year 2017, which ended on October 29. Applied’s growth momentum is likely to continue in the near future. This solid execution and optimistic outlook has driven a massive rally in the company’s stock, which has risen by around 65% since the beginning of the year, even after a recent pullback. Applied Materials’ recent surge in Display revenues is being driven by large format TVs and increasing investments in OLED displays by its customers. The company is seeing a significant market opportunity in OLED display equipment, as its key customers are ramping up investments in the technology. The uptick in display orders for Applied suggests that the segment can be a major revenue growth driver for the company in the future.  Here are some comments by Gary E. Dickerson –President and CEO, Applied Materials, Inc. regarding the display industry
“In our last earnings call, we said 2018 display revenue would be up more than 30% versus 2017. Our view for 2018 is now even more positive, and we see revenue growth exceeding our previous estimates. Basically, there are two big drivers for display. One is TVs and the other is mobile OLED. In the large screen televisions, we have 13 factories that we're tracking that are Gen 10.5. And what we see through 2020 in mobile OLED, with the investment that's being made, you'll be able to build about 50%, right around 50% of smartphones with OLED screens in that timeframe. The mix relative to revenue 2017 is more weighted to mobile versus TV. The mix in 2018 is pretty balanced between TV and mobile. But, again, both cases, we see these as multiyear drivers for display. And as we mention in the prepared remarks, we have a long lead times for display, and we see display healthy 2018 and 2019. The other thing I'd mention about display is, it is unique for Applied Materials; in expanding our materials innovation into this market, the complexities increasing and it really has been a great growth driver for the company.”
 
We tried to verify the comment regarding 13 Gen 10.5 fabs but could find no source nor could we come up with a comparable number.