Applied Materials, Inc. stock research
FY2025 Q4
Applied Materials (AMAT) Gross Margin — Quarter Ended Oct 26, 2025
Revenue and gross profit both decreased from the prior quarter, while cost of revenue declined at a slower pace, resulting in a slightly lower gross margin. Compared to the same quarter last year, revenue was slightly lower, gross profit was stable, cost of revenue was slightly lower, and gross margin improved modestly.
Gross margin takeaway
Quarter ended Oct 26, 2025 · FY2025 Q4
Revenue and gross profit both decreased from the prior quarter, while cost of revenue declined at a slower pace, resulting in a slightly lower gross margin. Compared to the same quarter last year, revenue was slightly lower, gross profit was stable, cost of revenue was slightly lower, and gross margin improved modestly.
- The strongest observable margin driver is the relationship between revenue and cost of revenue: revenue declined more sharply than cost of revenue from the prior quarter, compressing gross margin. Compared to a year ago, cost of revenue decreased slightly while gross profit held steady, allowing gross margin to improve.
- Compared to the immediately preceding quarter, gross margin weakened as revenue fell faster than cost of revenue. Compared to the same quarter one year earlier, gross margin improved, driven by a slight reduction in cost of revenue while gross profit remained essentially unchanged.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
48.0%
Gross profit
$3.3B
Revenue
$6.8B
Cost of revenue
$3.5B
Quarter-over-quarter change
-0.8 pts
Year-over-year change
+0.7 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jan 26, 2025 | $7.2B | $3.5B | $3.7B | 48.8% |
| Apr 27, 2025 | $7.1B | $3.5B | $3.6B | 49.1% |
| Jul 27, 2025 | $7.3B | $3.6B | $3.7B | 48.8% |
| Oct 26, 2025 | $6.8B | $3.3B | $3.5B | 48.0% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jul 27, 2025
-0.8 pts
Year-over-year change
Oct 27, 2024
+0.7 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the relationship between revenue and cost of revenue: revenue declined more sharply than cost of revenue from the prior quarter, compressing gross margin. Compared to a year ago, cost of revenue decreased slightly while gross profit held steady, allowing gross margin to improve.
Compared to the immediately preceding quarter, gross margin weakened as revenue fell faster than cost of revenue. Compared to the same quarter one year earlier, gross margin improved, driven by a slight reduction in cost of revenue while gross profit remained essentially unchanged.
Monitor the trajectory of cost of revenue relative to revenue, as a slower decline in cost of revenue compared to revenue could continue to pressure gross margin.