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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 5, 1997
APPLIED MATERIALS, INC.
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 0-6920 94-1655526
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(State or other jurisdiction (Commission File Number) (IRS employer
of Incorporation) identification
number)
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<S> <C>
3050 Bowers Avenue, Santa Clara, California 95054-3299
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 727-5555
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Inapplicable
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
On May 5, 1997, the Company issued a press release announcing settlement of
all outstanding litigation with Novellus Systems, Inc., pursuant to which the
Company would receive $80 million from Novellus regarding damages for past
patent infringement and ongoing royalties for all future shipments of TEOS-based
systems. The amount for past patent infringement ($80 million) was received
early in the Company's third fiscal quarter of 1997, and will be reflected in
the Company's results of operations for that period. A copy of the press release
is attached hereto as Exhibit 99.1 and incorporated herein by reference.
On May 13, 1997, the Company issued a press release announcing its results
of operations for the three and six months ended April 27, 1997. A copy of the
financial statements attached to the press release is attached hereto as Exhibit
99.2 and incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
Exhibit Number Exhibit
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27 Financial Data Schedule (filed electronically)
99.1 Press Release, dated May 5, 1997, of Applied
Materials, Inc., announcing settlement of
Novellus litigation
99.2 Financial Statements attached to Press Release,
dated May 13, 1997, of Applied Materials, Inc.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: May 13, 1997
APPLIED MATERIALS, INC.
(Registrant)
By: /s/ Gerald F. Taylor
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Gerald F. Taylor
Senior Vice President and
Chief Financial Officer
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EXHIBIT INDEX
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<CAPTION>
Exhibit Number Exhibit
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<S> <C>
27 Financial Data Schedule: filed electronically
99.1 Press Release, dated May 5, 1997, of Applied Materials, Inc.,
announcing settlement of Novellus litigation
99.2 Financial Statements attached to Press Release, dated
May 13, 1997, of Applied Materials, Inc.
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Applied Materials - Press Releases
http://www.appliedmaterials.com/html3/about/press/pr-970505.html
EXHIBIT 99.1
Press Releases [LOGO]
Release: Immediate
Contact: Joe Pon (editorial/media) Jerry Taylor (financial community)
(408) 748-5508 (408) 748-5227
Contact: Robert Smith
(chief financial officer)
NOVELLUS SYSTEMS, INC.
(408) 943-9700
APPLIED MATERIALS AND NOVELLUS SYSTEMS REACH
COMPREHENSIVE SETTLEMENT OF ALL PATENT DISPUTES
SANTA CLARA, Calif., May 5, 1997 -- Applied Materials, Inc. and Novellus
Systems, Inc., jointly announced today they have amicably resolved their
disputes with a comprehensive, global settlement which includes termination of
all outstanding litigation between them and cross licenses of patents related to
certain aspects of chemical vapor deposition (CVD).
Novellus has agreed to pay $80 million in damages to Applied Materials for past
infringement and a royalty for all future shipments of TEOS-based systems. Other
terms of the settlement are confidential. Both parties expressed satisfaction
with the settlement, which enables both companies to refocus their efforts on
providing the best competitive solutions for the needs of their customers.
"A final resolution of these patent disputes provides a balanced recognition of
the companies' respective intellectual property rights, and will foster
continuing competition and product developments, along with improved customer
satisfaction," said Joseph J. Sweeney, vice president of Intellectual Property
and Legal Affairs at Applied Materials.
"Novellus welcomes the opportunity to address fully all customer needs for CVD
technologies, with an appropriate resolution of competing intellectual property
rights by both sides," said Richard S. Hill, chairman and chief executive
officer of Novellus.
Applied Materials, Inc. is a Fortune 500 global growth company and the world's
largest supplier of wafer fabrication systems and services to the global
semiconductor industry. Applied Materials is traded on the Nasdaq National
Market under the symbol "AMAT." Applied Materials' website is
http://www.AppliedMaterials.com. Novellus Systems, Inc. manufacturers, markets,
and services advanced automated wafer fabrication systems for chemical vapor
deposition (CVD) of thin films. The Company's stock trades on the Nasdaq Stock
Market's National Market under the symbol "NVLS".
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EXHIBIT 99.2
APPLIED MATERIALS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
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<CAPTION>
Three Months Ended Six Months Ended
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April 27, April 28, April 27, April 28,
(In thousands, except per share amounts) 1997 1996 1997 1996
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<S> <C> <C> <C> <C>
Net sales $900,862 $1,127,855 $1,736,638 $2,168,435
Cost of products sold 486,845 586,564 950,965 1,130,344
-------- ---------- ---------- ----------
Gross margin 414,017 541,291 785,673 1,038,091
Operating expenses:
Research, development and engineering 131,973 124,918 248,465 235,270
Marketing and selling 74,965 80,587 141,236 157,869
General and administrative 59,617 54,820 119,225 104,375
Acquired in-process research and
development -- -- 59,500 --
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Income from operations 147,462 280,966 217,247 540,577
Interest expense 4,935 4,917 10,735 10,085
Interest income 14,598 9,829 28,155 19,426
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Income from consolidated companies
before taxes 157,125 285,878 234,667 549,918
Provision for income taxes 54,994 100,057 102,959 192,471
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Income from consolidated companies 102,131 185,821 131,708 357,447
Equity in net income/(loss) of joint venture -- -- -- --
-------- ---------- ---------- ----------
Net income $102,131 $ 185,821 $ 131,708 $ 357,447
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Earnings per share $ .54 $ 1.01 $ .71 $ 1.94
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Average common shares and equivalents 187,899 183,699 186,762 183,921
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APPLIED MATERIALS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS*
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<CAPTION>
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April 27, Oct. 27,
(In thousands) 1997 1996
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 202,660 $ 403,888
Short-term investments 872,190 633,744
Accounts receivable, net 807,181 822,384
Inventories 507,632 478,552
Deferred income taxes 278,352 281,586
Other current assets 83,295 72,915
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Total current assets 2,751,310 2,693,069
Property, plant and equipment, net 900,041 919,038
Other assets 240,510 25,880
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Total assets $ 3,891,861 $ 3,637,987
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 19,892 $ 77,522
Current portion of long-term debt 7,659 22,640
Accounts payable and accrued expenses 875,808 791,897
Income taxes payable 147,713 43,168
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Total current liabilities 1,051,072 935,227
Long-term debt 227,808 275,485
Deferred income taxes and other non-current obligations 107,601 56,850
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Total liabilities 1,386,481 1,267,562
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Stockholders' equity:
Common stock 1,815 1,802
Additional paid-in capital 781,281 763,376
Retained earnings 1,731,272 1,599,564
Cumulative translation adjustments ( 8,988) 5,683
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Total stockholders' equity 2,505,380 2,370,425
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Total liabilities and stockholders' equity $ 3,891,861 $ 3,637,987
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* Amounts as of April 27, 1997 are unaudited. Amounts as of October 27, 1996
were obtained from the October 27, 1996 audited financial statements.
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<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED APRIL 27, 1997
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-26-1997
<PERIOD-END> APR-27-1997
<CASH> 202,660
<SECURITIES> 872,190
<RECEIVABLES> 807,181
<ALLOWANCES> 0
<INVENTORY> 507,632
<CURRENT-ASSETS> 2,751,310
<PP&E> 1,339,444
<DEPRECIATION> 439,403
<TOTAL-ASSETS> 3,891,861
<CURRENT-LIABILITIES> 1,051,072
<BONDS> 227,808
0
0
<COMMON> 1,815
<OTHER-SE> 2,503,565
<TOTAL-LIABILITY-AND-EQUITY> 3,891,861
<SALES> 1,736,638
<TOTAL-REVENUES> 1,736,638
<CGS> 950,965
<TOTAL-COSTS> 950,965
<OTHER-EXPENSES> 568,426
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,735
<INCOME-PRETAX> 234,667
<INCOME-TAX> 102,959
<INCOME-CONTINUING> 131,708
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 131,708
<EPS-PRIMARY> 0.71
<EPS-DILUTED> 0.71
</TABLE>
