Applied Materials dividend: cash coverage
Applied Materials pays $2.12 per share currently, after nine consecutive annual increases. Across fiscal 2021–2025, free cash flow covered total shareholder payments overall, but fiscal 2025 payments exceeded free cash flow.
How much does Applied Materials pay per share?
Base dividends rise from $2.27 per share to $2.75. The bear case holds the current $2.12 run rate briefly, then cuts to $1.59; the bull reaches $3.13. The base's 10% annual increase is below the latest 15% raise and the five-year dividend growth record. Nine consecutive annual increases support continued growth, but the payout policy covers buybacks as well as dividends.
| Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 | |
|---|---|---|---|---|---|
| EPS, diluted | 8.66 | 8.61 | 8.11 | 7.44 | 6.40 |
| − Dividends paid, per share | 1.71 | 1.43 | 1.15 | 1.00 | 0.91 |
| − Share buybacks, per share | 6.06 | 4.58 | 2.59 | 6.96 | 4.08 |
| = FCF not paid out, per share | 2.96 | 5.24 | 0.20 |
Is Applied Materials' dividend covered by its cash?
Across fiscal 2021–2025, Applied generated US$30,165 million of free cash flow and paid shareholders US$26,022 million. Free cash flow is the operating cash left after capital spending, so this distribution came after research, buildings and equipment had already consumed cash.
The annual pattern was less even. In fiscal 2022, Applied paid shareholders US$6,976 million against US$4,612 million of free cash flow. In fiscal 2025, it paid US$6,279 million against US$5,698 million generated. Such payouts can draw on saved cash or borrowing, but repeated excess distributions reduce the financial cushion. Applied ended fiscal 2025 with US$2,018 million of net cash, down from US$3,212 million a year earlier.
| Oct 2025 | Oct 2024 | Oct 2023 | Oct 2022 | Oct 2021 | |
|---|---|---|---|---|---|
| Free cash flow | 5,698 | 7,487 | 7,594 | 4,612 | 4,774 |
| − Dividends paid | 1,384 | 1,192 | 975 | 873 | 838 |
| − Share buybacks | 4,895 | 3,823 | 2,189 | 6,103 | 3,750 |
| = Free cash flow not paid out | 2,472 | 4,430 | 186 | ||
| = Paid out more than the free cash flow | 581 | 2,364 | |||
| Paid out, % of free cash flow | 110.2% | 67.0% | 41.7% | 151.3% | 96.1% |
What could change Applied Materials' dividend?
The view would also weaken if EPIC and Singapore capacity spending continues through FY2029 without production wins. Cash flow and buybacks would fall before the investment produced returns.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Normal operating profit | 11,100 (9,570 / 12,480) | 11,900 (8,525 / 14,256) | 12,505 (9,860 / 15,840) |
| Dividends per share | 2.27 (2.12 / 2.36) | 2.50 (1.59 / 2.71) | 2.75 (1.59 / 3.13) |
| Net debt | -3,545 (-3,841 / -3,390) | -4,769 (-4,722 / -4,990) | -6,491 (-6,949 / -7,585) |
What is Applied Materials' dividend yield today?
Revenue growth slowed from 34.1% in FY2021 to 4.4% in FY2025, while operating margin stayed near 29%–30%. Applied’s computed free cash flow—cash from operations minus capital spending—fell as a share of revenue in FY2025. Real free cash flow per share fell while diluted EPS held up. At $507.03 a share, trailing P/E is 43.7x and next-twelve-month P/E is 27.1x. Free cash flow yield is 1.4%; dividend yield is 0.4%. Buybacks reduced the share count but cannot replace cash generation.