Applied Materials Inc. (NASDAQ:AMAT)

Net Fixed Asset Turnover

The net fixed asset turnover ratio increased steadily from 9.66 in early 2020 to a peak of 12.25 by the beginning of 2022, indicating improved efficiency in utilizing fixed assets to generate sales during this period. Following this peak, there is a gradual and continuous decline to 6.94 by mid-2025, suggesting a reduction in asset utilization efficiency or possible increases in fixed asset base not matched by proportional revenue growth.

Total Asset Turnover

The total asset turnover ratio shows an initial fluctuation but an overall upward trend from 0.76 in early 2020 to a peak near 0.98 by mid-2022, reflecting enhanced effectiveness in generating sales from total assets during this time. After mid-2022, the ratio shows a mild declining trend, dropping to around 0.79-0.83 towards mid-2025, indicating a slight decrease in the company’s overall asset utilization efficiency.

Equity Turnover

Equity turnover experienced some variability but generally increased from 1.73 in early 2020 to above 2.1 in early 2022, reflecting stronger sales generation relative to shareholders’ equity. After reaching these higher levels, the ratio declines steadily to below 1.5 by mid-2024, stabilizing around 1.47 by mid-2025. This trend suggests a reduced ability to generate revenue per unit of equity over the latter periods analyzed.

Net Revenue Trend

Net revenue demonstrates a generally upward trajectory over the observed periods, increasing from approximately $4.16 billion to around $7.30 billion. Initial growth phases are marked by consistent quarterly increments, peaking near the early 2025 mark. Despite minor fluctuations, revenue remains robust, indicating sustained demand and growth momentum in the company's operations.

Property, Plant and Equipment (PP&E), Net

The net value of property, plant, and equipment exhibits a steady and significant increase from roughly $1.55 billion to $4.12 billion. This substantial capital investment over time suggests ongoing expansion and modernization of the company's asset base, potentially to support revenue growth and operational capacity. Increases show consistent quarterly gains without notable declines.

Net Fixed Asset Turnover Ratio

The net fixed asset turnover ratio starts high near 9.66 and rises slightly to a peak above 12.00 in early 2022, indicating efficient utilization of fixed assets relative to revenue during this phase. However, post-peak, the ratio exhibits a consistent downward trend toward approximately 6.94 by mid-2025. This decline may reflect the accelerated asset base growth outpacing revenue increases, signaling potential diminishing efficiency in asset usage or a strategic shift in capital intensity.

Combined Analysis

The dataset reveals a scenario where net revenue increases steadily, supported by significant capital investment in fixed assets. However, the declining fixed asset turnover ratio suggests that the incremental revenues are not expanding proportionally with fixed asset additions. This pattern may highlight an evolution toward a more capital-intensive business model or possible lag in revenue realization from recent investments. Continued monitoring of this ratio is advisable to assess whether asset utilization efficiencies improve or if the trend signals a need for operational adjustments.

The analysis of quarterly financial data reveals notable trends in the company’s operational efficiency and asset management over the observed periods.

Net Revenue

Net revenue consistently increased from the beginning of the period, starting at $4,162 million and peaking in the later quarters around $7,302 million. The data shows a strong upward trajectory, particularly from early 2021 onward, with only minor fluctuations. This steady growth indicates a positive market demand and successful revenue generation strategies.

Total Assets

Total assets also followed an increasing trend, rising from approximately $19,767 million at the start to over $34,211 million by the end of the observed timeframe. The steady growth in assets suggests ongoing investments and expansion of resources. However, there are slight variations and occasional plateaus in asset accumulation, which may reflect capital expenditures balanced with disposals or depreciation.

Total Asset Turnover Ratio

The total asset turnover ratio, which measures revenue generated per dollar of assets, exhibited some volatility throughout the periods. Initially, the ratio hovered around 0.76 and experienced a gradual increase, reaching notable highs near 0.98 in certain quarters around 2022. After that, the ratio gradually declined, stabilizing around 0.83-0.84 in the latest quarters. The initial increase suggests improving asset utilization efficiency, while the later plateau and slight decrease could indicate that asset growth outpaced revenue improvements or shifts in operational dynamics.

In summary, the company demonstrated strong revenue growth alongside a substantial increase in asset base. While asset turnover improved notably during the middle periods, it has somewhat leveled off recently. This pattern implies that although revenue generation expanded markedly, optimizing asset use efficiency remains an area to monitor closely.

The quarterly financial data reveals several notable trends in net revenue, stockholders’ equity, and equity turnover ratios over the observed periods. Each of these metrics exhibits distinctive behaviors reflecting operational performance and financial management.

Net Revenue

Net revenue demonstrates a generally upward trajectory with some fluctuations over the quarters. Starting at approximately $4,162 million in early 2020, revenues initially increased steadily and peaked in early 2025 at around $7,302 million. Despite occasional declines, such as the dips observed around mid-2023 and early 2024, the overall trend reflects growth and expansion in sales or services contributing to revenue generation.

Stockholders’ Equity

Stockholders’ equity similarly shows an increasing trend from $8,660 million in early 2020 to about $19,504 million by early 2025. This steady increase indicates enhanced retained earnings, possible capital infusions, or appreciation of assets. Notably, the equity appears to accelerate in growth particularly from early 2023, suggesting stronger capital base augmentation or accumulation of profits during this period.

Equity Turnover Ratio

The equity turnover ratio exhibits a declining pattern overall, starting at 1.73 in early 2020 and falling to around 1.47 by the beginning of 2025. The ratio fluctuates moderately with peaks during 2021 and early 2022, reaching above 2.1 before declining again. The decreasing ratio over the long term suggests that net revenue is increasing at a slower rate than stockholders’ equity, indicating potentially diminishing utilization efficiency of equity to generate revenue.

Collectively, these trends suggest the company has been successful in growing its revenue and equity simultaneously, though with some easing in efficiency as measured by equity turnover. The increasing equity base and revenue growth support financial strength and expansion, while the decline in turnover might prompt further analysis into asset utilization or changes in operational dynamics affecting revenue generation relative to equity invested.