Cash Flow Statement
The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.
The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.
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- Income Statement
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Geographic Areas
- Capital Asset Pricing Model (CAPM)
- Dividend Discount Model (DDM)
- Debt to Equity since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Aggregate Accruals
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Applied Materials Inc., consolidated cash flow statement
US$ in millions
Based on: 10-K (reporting date: 2024-10-27), 10-K (reporting date: 2023-10-29), 10-K (reporting date: 2022-10-30), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-25), 10-K (reporting date: 2019-10-27).
- Net Income
- Net income demonstrated a consistent upward trend over the six-year period, increasing from $2,706 million in 2019 to $7,177 million in 2024. The growth was steady each year, indicating improving profitability.
- Depreciation and Amortization
- Depreciation and amortization expenses generally increased from $363 million in 2019 to a peak of $515 million in 2023, before declining to $392 million in 2024, suggesting changes in asset base or amortization schedules in the final year.
- Severance and Related Charges
- Severance charges were absent for most years except for $148 million in 2021 and a small negative amount in 2022, indicating an unusual one-time event in 2021 and some reversal in 2022.
- Deferred Income Taxes
- Deferred income taxes fluctuated substantially, moving from positive figures in 2019-2021 to a large negative amount in 2022 (-$223 million) and even more negatively in 2024 (-$633 million), reflecting significant changes in tax assets or liabilities.
- Share-Based Compensation
- Share-based compensation consistently increased each year, rising from $263 million in 2019 to $577 million in 2024, indicating growing costs related to equity incentives.
- Other Adjustments
- The "Other" category showed volatility, with negative and positive values alternating, indicating miscellaneous adjustments without a clear trend.
- Changes in Working Capital Components
- Accounts receivable and inventories experienced high volatility with sizable negative values in some years and positive in others, indicating fluctuations in asset management and sales cycles. Accounts payable and accrued expenses also varied, reflecting changing payment and expense dynamics. Contract liabilities notably increased sharply in 2021 and 2022 but then reversed in 2023 and 2024. Overall net changes in operating assets and liabilities were negative from 2019 to 2022 but shifted to positive in 2023 and further increased in 2024, enhancing cash flow from operations in recent years.
- Cash Provided by Operating Activities
- Cash from operations increased markedly over the period from $3,247 million in 2019 to peaks of $8,700 million and $8,677 million in 2023 and 2024 respectively, driven by higher net income and improved working capital management.
- Capital Expenditures
- Capital expenditures steadily grew from $441 million in 2019 to $1,190 million in 2024, reflecting greater investment in property, plant, and equipment.
- Cash Used in Investing Activities
- Investing cash flow outflows fluctuated, with a low of $130 million in 2020 and a peak outflow of $2,327 million in 2024, driven mainly by increased purchases of investments and capital expenditures.
- Financing Activities
- Financing cash flows showed large outflows overall. Common stock repurchases were significant, peaking at $6,103 million in 2022 before reducing in subsequent years but remaining substantial. Dividends consistently increased from $771 million to $1,192 million over the period. Debt borrowings were recorded mainly in 2020 and to a lesser extent in 2024, with corresponding repayments mostly in 2020. Commercial paper activity appeared only in the last two years, with proceeds offset by repayments. Common stock issuances gradually increased, but tax withholding payments related to equity awards also rose.
- Cash and Cash Equivalents
- Cash balances end-of-period fluctuated in line with operational and financing cash flows. Notably, there was a sharp decrease in 2022 to $2,100 million from $5,101 million, followed by a substantial increase in 2023 and 2024, reaching $8,113 million, reflecting strong operating cash inflow and controlled financing outflows.