Applied Materials Targets 54% Gross Margin by 2030 on AI Infrastructure Demand

Key Facts

1Applied Materials targets a non-GAAP gross margin of approximately 54% and an operating margin of about 40% by 2030.

2The company plans to return 80% to 100% of free cash flow to shareholders over time.

3Cantor Fitzgerald maintains an Outperform rating on AMAT despite the stock falling 6.71% during the session.

Applied Materials targets a non-GAAP gross margin of approximately 54% and an operating margin of about 40% by 2030. The company stated during its SEMICON West investor presentation that it plans to return 80% to 100% of free cash flow to shareholders over time. These targets are part of a long-term strategy to capitalize on the multi-year buildout of AI infrastructure, with the company expecting spending on wafer fab equipment to grow faster through 2030 than in the previous decade.

Cantor Fitzgerald maintains an Outperform rating on AMAT despite the stock falling 6.71% during the session as investors took profits in chip-equipment stocks. AMAT closed at $497.53 on October 12, 2026, while peer Lam Research (LRCX) closed at $309.56 on the same date. Applied Materials aims to gain more than 2 percentage points of market share in wafer fab equipment between 2025 and 2030.