Applied Materials vs MKS Instruments
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KIRA’s take AI analyst
I put Applied Materials and MKS Instruments side by side, using each one’s latest annual report. Here is what stands out:
- Applied Materials is the larger business, with $28.4B of revenue in fiscal 2025 against $3.9B for MKS Instruments, about 7.2 times as much.
- MKS Instruments grew revenue faster (9.6%, against 4.4%).
- Applied Materials kept more of each dollar of sales as operating profit (29.2% operating margin, against 13.4%).
- Applied Materials turned more of its sales into free cash flow (20.1% FCF margin, against 12.6%).
- Applied Materials earned a higher return on the capital invested in it (35.9%, against 7.9%).
- Investors pay more for each dollar of Applied Materials’s earnings: a P/E of 33.4x against 32.2x for MKS Instruments.
Who comes out ahead
Of the 11 measures where higher (or lower) is clearly better, how many each company leads.
Applied Materials
AMAT
9/11
Gross marginOperating marginNet marginFCF marginReturn on capitalReturn on equityPiotroski F-scoreNet debt / EBITDAShare count change
MKS Instruments
MKSI
2/11
Revenue growth5-year growth
Side by side
Best in the row
| Latest fiscal year | AMAT FY25 | MKSI FY25 |
|---|---|---|
| Size | ||
| Market cap | $310.1B | $14.7B |
| Revenue | $28.4B | $3.9B |
| Free cash flow | $5.7B | $497M |
| Net income | $7.0B | $295M |
| Growth | ||
| Revenue growth | 4.4% | 9.6% |
| 5-year growth | 10.5% | 11.0% |
| Share count change | −3.1% | 0.2% |
| Profitability | ||
| Gross margin | 48.7% | 46.7% |
| Operating margin | 29.2% | 13.4% |
| Net margin | 24.7% | 7.5% |
| FCF margin | 20.1% | 12.6% |
| Return on capital | 35.9% | 7.9% |
| Return on equity | 35.5% | 11.7% |
| Balance sheet | ||
| Net debt | −$2.0B | $3.9B |
| Net debt / EBITDA | −0.2x | 4.4x |
| Dividends and buybacks | $6.3B | $104M |
| Valuation & quality | ||
| P/E | 33.4x | 32.2x |
| Piotroski F-score | 7 | 6 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.