Applied Materials CEO Says the AI Boom Is Nowhere Near Over. His Order Book Is the Proof

Applied Materials CEO Says the AI Boom Is Nowhere Near Over. His Order Book Is the Proof

Omor Ibne Ehsan

Thu, September 10, 2026 at 7:10 PM GMT+3 6 min read

Quick Read

• Dickerson backs his 40% growth forecast with rolling eight-quarter customer commitments and AMAT guidance pointing to $10.25 billion in October quarter revenue.

• LRCX, KLAC, and ASML all raised 2026 outlooks in the same quarter, corroborating Applied's order book and signaling a real equipment cycle.

• AMAT's forward P/E of 26 and 188% one-year gain suggest the bull case is largely priced in, favoring entry near the $407 moving average.

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Gary Dickerson sat down with David Faber at Goldman's Copia Conference and led with an order book. Applied Materials (NASDAQ:AMAT) customers are handing the company rolling eight-quarter forecasts and longer tool-shipment commitments. Chipmakers do not commit two years of capital equipment orders on a hunch.

Dickerson told Faber the company is "approaching 40% growth this year, and it's really all driven by AI compute demand." He expects the run to continue: "absolutely strong growth in 26, we see very strong growth in 27 and for many years going into the future."

Those are his forward expectations for calendar 2026 and 2027, spoken in shorthand, and they are not booked results. The harder question is whether the contracted demand behind his confidence justifies the stock's price after a substantial move.

What Applied Materials Actually Sells to Every AI Chip Maker

Applied sells the deposition, etch, ion implant, and process control tools that fabs use to build transistors layer by layer. Every leading-edge foundry and memory maker buys from Applied, which is why the company sits upstream of every NVIDIA accelerator, every HBM stack, and every advanced package.

Dickerson's argument is that AI has changed the mix. Applied cites leading-edge foundry logic, DRAM, and advanced packaging as the three fastest-growing areas, together expected to represent around 80% of wafer fab equipment growth in 2026 and 2027.

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The August quarter delivered revenue of $9.12 billion, up 24.8% year over year, with non-GAAP EPS of $3.50. Guidance for the October quarter calls for revenue near $10.25 billion. CFO Brice Hill said customer visibility now extends in some conversations to 2030, and the company is preparing to double its quarterly system output by 2028.

Dickerson told Faber, "AI is really the most disruptive technology I've seen in my lifetime. We have these eight quarter forecasts from our customers, longer commitments from our customers in terms of our tool shipments."

DRAM and Packaging Are Doing the Heavy Lifting

Memory has become the most visible AI beneficiary inside Applied's numbers. Dickerson said "DRAM revenue grew from 22% to 26% of semiconductor systems revenue". Management said DRAM revenue, including HBM packaging, grew 52% year over year to record levels.

His scale claim is his own, offered at a sell-side conference rather than measured by a third party. He told Faber, "DRAM is absolutely key. Part of that. And again, Applied is number one. Our size is about the same as the next two competitors combined."

Advanced packaging, which stacks and bonds the chiplets AI accelerators require, is expected to grow more than 70% in calendar 2026. Applied describes itself as the overall leader in this market with positions in HBM and 3D chiplet stacking.

Exact share figures aside, memory and packaging complexity are rising faster than logic node transitions, and Applied's tools sell into both categories at the same fabs.

Peer Setup Corroborates the Order Book

Lam Research (NASDAQ:LRCX) reported June-quarter revenue of $6.72 billion, up 30.0% year over year, and CEO Tim Archer expects a third consecutive year of outperformance in 2026. Lam raised its calendar 2026 WFE view to the low $150 billion range, up from $140 billion.

KLA Corporation (NASDAQ:KLAC) posted record revenue of $3.66 billion and expects remaining performance obligations around $12.5 billion. CEO Rick Wallace said momentum is accelerating in the second half of calendar 2026 and continuing through 2027.

ASML Holding (NASDAQ:ASML) is the most convincing corroboration because it is the sole EUV lithography supplier. CEO Christophe Fouquet said ASML plans to add 30% to its 2026 low NA EUV capacity of around 65 for 2027, with another 30% under investigation for 2028, detailed in the Q2 2026 6-K.

When four equipment suppliers raise outlooks in the same quarter and cite the same fabs, the cycle is real, and the picks-and-shovels names supplying that buildout are exactly the kind we profiled in a free report on seven AI infrastructure stocks that aren't chipmakers.

Where AMAT Stock Stands

Applied trades at a trailing P/E of 41x and forward P/E of 26x, with a current price of $468.85. Shares have gained 188.38% over the past year, though the stock sits below its 52-week high of $738.88 and is down 10.11% over the past month.

The cyclical risk deserves respect. Equipment is the most volatile link in the semiconductor chain, forecasts are not purchase orders, and clean-room availability can delay revenue recognition even when customer intent is firm.

Compared with peers, Applied has the broadest exposure across deposition, etch, implant, packaging, and services. ASML has the strongest moat as sole EUV supplier and the clearest contracted 2028 capacity commitments. Lam has the tightest memory-upgrade leverage. KLA has the most defensible margins and the deepest recurring services base.

An equipment supplier is a more cyclical way to own AI infrastructure than a chip designer, though a more diversified one. On balance, Dickerson's eight-quarter visibility supports the near-term case, though the price already reflects much of it, and the risk-reward for investors researching the name likely improves on any pullback toward its 200-day moving average of $407.06.

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