Why Applied Materials Stock Jumped 40%?
Applied Materials (AMAT)’s stock leapt 44%, riding a surge in investor optimism as AI-driven demand and stellar quarterly beats overshadowed small margin dips and China worries. With a 40% jump in its P/E multiple and fresh analyst upgrades, the market’s clearly pricing in something bigger.
Below is an analytical breakdown of stock movement into key contributing metrics.
| 5282025 | 11242025 | Change | |
|---|---|---|---|
| Stock Price ($) | 160.8 | 230.9 | 43.6% |
| Change Contribution By | LTM | LTM | |
| Total Revenues ($ Mil) | 28,089.0 | 28,613.0 | 1.9% |
| Net Income Margin (%) | 24.1% | 23.9% | -0.8% |
| P/E Multiple | 19.3 | 27.0 | 40.1% |
| Shares Outstanding (Mil) | 809.0 | 798.0 | 1.4% |
| Cumulative Contribution | 43.6% |
So what is happening here? The stock surged 44%, fueled mainly by a 40% boost in its P/E multiple, alongside a modest 1.9% rise in revenue and a slight 0.8% dip in net margin. Here’s what’s driving this.
Here Is Why Applied Materials Stock Moved
- Q4 2025 Earnings Beat: AMAT reported Q4 2025 EPS of $2.17, beating consensus of $2.11. Revenue declined 3.5% YoY.
- Q3 2025 Record Results: Record Q3 FY2025 results with 8% YoY revenue growth and 17% YoY non-GAAP EPS increase.
- AI-Driven Demand: Strong tailwinds from AI and high-bandwidth memory (HBM) chips fueled growth optimism.
- Analyst Upgrades: UBS upgraded AMAT to Buy with a $285 price target in November 2025, citing WFE demand.
- China Business Concerns: Macroeconomic policy uncertainty and capacity digestion in China impacted revenue outlook.
Our Current Assesment Of AMAT Stock
Opinion: We currently find AMAT stock fairly priced. Why so? Have a look at the full story. Read Buy or Sell AMAT Stock to see what drives our current opinion.
Risk: A good way to gauge risk with AMAT is to check how deep its drops have been in past market meltdowns. It fell about 76% during the Dot-Com Bubble, nearly 64% in the Global Financial Crisis, and around 55% during the Inflation Shock. Even less severe sell-offs like the 2018 Correction and the Covid Pandemic triggered declines above 40%. Solid fundamentals matter, but history shows AMAT can still take big hits when markets turn sour.
AMAT stock may have seen strong gains recently, but investing in a single stock without detailed, thorough analysis can be risky. The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 — the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.