Home > Comparison > Technology > AMAT vs CRUS
The strategic rivalry between Applied Materials, Inc. and Cirrus Logic, Inc. shapes the semiconductor industry’s evolution. Applied Materials operates as a capital-intensive equipment manufacturer with a broad global footprint. Cirrus Logic, in contrast, is a nimble fabless semiconductor innovator specializing in mixed-signal processing solutions. This analysis will explore their distinct approaches to leadership in semiconductors and identify which presents a superior risk-adjusted opportunity for a diversified portfolio.
Table of contents
Companies Overview
Applied Materials and Cirrus Logic are pivotal players in the semiconductor industry, shaping technology across diverse markets.
Applied Materials, Inc.: Semiconductor Manufacturing Powerhouse
Applied Materials dominates as a leading supplier of semiconductor manufacturing equipment and services. Its revenue stems from selling advanced fabrication tools and integrated solutions across semiconductor systems, global services, and display technologies. In 2026, the company focuses on expanding its innovative equipment portfolio and optimizing fab productivity to capture growth in chipmaking and adjacent display markets.
Cirrus Logic, Inc.: Fabless Audio Semiconductor Specialist
Cirrus Logic excels as a fabless semiconductor firm specializing in low-power, high-precision mixed-signal processing solutions. It generates revenue primarily through audio codecs and amplifiers used in consumer electronics and industrial applications. Its 2026 strategy emphasizes enhancing audio quality and expanding into haptics and power ICs for emerging industrial and energy sectors.
Strategic Collision: Similarities & Divergences
Both firms operate within semiconductors but diverge sharply in business models: Applied Materials develops capital equipment, while Cirrus Logic designs fabless ICs. Their primary battleground lies in innovation-driven semiconductor market segments—equipment manufacturing versus specialized audio and mixed-signal chips. This contrast creates distinct investment profiles, with Applied Materials embodying industrial scale and Cirrus Logic focusing on niche, technology-driven growth.
Income Statement Comparison
This data dissects the core profitability and scalability of both corporate engines to reveal who dominates the bottom line:
| Metric | Applied Materials, Inc. (AMAT) | Cirrus Logic, Inc. (CRUS) |
|---|---|---|
| Revenue | 28.4B | 1.90B |
| Cost of Revenue | 14.6B | 900M |
| Operating Expenses | 5.52B | 586M |
| Gross Profit | 13.8B | 996M |
| EBITDA | 9.65B | 497M |
| EBIT | 9.54B | 445M |
| Interest Expense | 269M | 0.9M |
| Net Income | 7.00B | 332M |
| EPS | 8.71 | 6.24 |
| Fiscal Year | 2025 | 2025 |
Income Statement Analysis: The Bottom-Line Duel
This income statement comparison unveils the true operational efficiency and profit dynamics of two leading semiconductor players.
Applied Materials, Inc. Analysis
Applied Materials grew revenue from $23B in 2021 to $28.4B in 2025, with net income rising from $5.9B to $7B. Its gross margin remains strong near 49%, while net margin holds at 24.7%. Despite slight net margin pressure last year, EBIT expanded 13.6%, reflecting operational momentum and solid cost control amid rising expenses.
Cirrus Logic, Inc. Analysis
Cirrus Logic increased revenue from $1.37B in 2021 to $1.9B in 2025, with net income surging 52.5% to $332M. Its gross margin outperforms Applied Materials at 52.5%, though net margin lags at 17.5%. The company shows striking EBIT growth of 21.9% last year and a robust EPS jump of 22.5%, signaling accelerating profitability and efficient expense management.
Margin Strength vs. Growth Velocity
Applied Materials delivers scale with superior net margin and steady revenue growth of 23% over five years. Cirrus Logic impresses with faster revenue (38.5%) and net income growth (52.5%), but at lower net margins. For investors prioritizing profitability and margin stability, Applied Materials stands out. Those favoring rapid earnings expansion may find Cirrus Logic’s profile more compelling.
Financial Ratios Comparison
These vital ratios act as a diagnostic tool to expose the underlying fiscal health, valuation premiums, and capital efficiency of these companies:
| Ratios | Applied Materials, Inc. (AMAT) | Cirrus Logic, Inc. (CRUS) |
|---|---|---|
| ROE | 34.3% | 17.0% |
| ROIC | 21.96% | 14.2% |
| P/E | 26.6 | 15.9 |
| P/B | 9.11 | 2.71 |
| Current Ratio | 2.61 | 6.35 |
| Quick Ratio | 1.87 | 4.82 |
| D/E | 0.35 | 0.07 |
| Debt-to-Assets | 19.4% | 6.2% |
| Interest Coverage | 30.8 | 457 |
| Asset Turnover | 0.78 | 0.81 |
| Fixed Asset Turnover | 5.54 | 6.62 |
| Payout Ratio | 19.8% | 0% |
| Dividend Yield | 0.74% | 0% |
| Fiscal Year | 2025 | 2025 |
Efficiency & Valuation Duel: The Vital Signs
Financial ratios act as a company’s DNA, exposing hidden risks and revealing operational excellence in clear, measurable terms.
Applied Materials, Inc.
Applied Materials posts a strong 34.3% ROE and a 24.7% net margin, signaling robust profitability. Its P/E of 26.6 and P/B of 9.11 mark the stock as stretched versus typical benchmarks. Despite a low dividend yield of 0.74%, the firm reinvests heavily in R&D, supporting long-term growth and shareholder value creation.
Cirrus Logic, Inc.
Cirrus Logic shows solid profitability with a 17.0% ROE and 17.5% net margin, reflecting operational efficiency. The stock trades at a moderate P/E of 15.95 and P/B of 2.71, indicating reasonable valuation. It pays no dividend but allocates substantial resources to R&D, aiming to fuel innovation and future expansion.
Premium Valuation vs. Operational Safety
Applied Materials commands a premium valuation supported by superior returns but at higher risk due to its stretched multiples. Cirrus Logic offers a more conservative valuation with healthy profitability and strong balance sheet metrics. Growth-oriented investors may prefer Applied Materials; value-focused investors might lean toward Cirrus Logic’s safer profile.
Which one offers the Superior Shareholder Reward?
Applied Materials (AMAT) pays a modest dividend yield near 0.77% with a sustainable payout ratio around 17%. It pairs this with steady buybacks, fueling total returns. Cirrus Logic (CRUS) pays no dividend but reinvests free cash flow aggressively, with strong buyback capacity and a pristine balance sheet. I see AMAT’s balanced income-plus-buyback strategy as more durable in 2026. CRUS’s pure growth model is riskier amid market volatility. For income-focused investors, AMAT offers the superior total shareholder reward today.
Comparative Score Analysis: The Strategic Profile
The radar chart reveals the fundamental DNA and trade-offs of Applied Materials, Inc. and Cirrus Logic, Inc., highlighting their financial strengths and weaknesses:
Applied Materials shows a robust return on equity (5) and assets (5) but struggles with valuation metrics, scoring low on price-to-book (1) and moderate on price-to-earnings (2). Cirrus Logic presents a more balanced profile with favorable scores across discounted cash flow (4), return on equity (4), and moderate debt-to-equity (3). While AMAT relies heavily on operational efficiency, CRUS offers a steadier valuation and capital structure balance.
Bankruptcy Risk: Solvency Showdown
The Altman Z-Score indicates both companies reside comfortably in the safe zone, signaling strong solvency for long-term survival in this cycle:
Financial Health: Quality of Operations
Both Applied Materials and Cirrus Logic score a 7 on the Piotroski F-Score, reflecting strong financial health. Neither firm shows internal red flags, suggesting solid operational quality and investment potential:
How are the two companies positioned?
This section dissects AMAT and CRUS’s operational DNA by comparing revenue distribution and internal dynamics, including strengths and weaknesses. The goal is to confront their economic moats and identify the most resilient competitive advantage today.
Revenue Segmentation: The Strategic Mix
This visual comparison dissects how Applied Materials and Cirrus Logic diversify their income streams and reveals where each company places its primary sector bets:
Applied Materials anchors its revenue in Semiconductor Systems with $19.9B in 2024, supported by $6.2B from Applied Global Services and $885M from Display and Adjacent Markets. Cirrus Logic pivots between Portable Audio Products at $1.1B and High-Performance Mixed Signal Products at $759M. AMAT exhibits a broader ecosystem lock-in, reducing concentration risk. CRUS relies heavily on audio, exposing it to sector cyclicality.
Strengths and Weaknesses Comparison
This table compares the Strengths and Weaknesses of Applied Materials, Inc. (AMAT) and Cirrus Logic, Inc. (CRUS):
AMAT Strengths
- Strong profitability with 24.67% net margin and 34.28% ROE
- Solid financial health with 2.61 current ratio and low 0.35 debt-to-equity
- Diverse revenue streams including Semiconductor Systems and Global Services
- Favorable interest coverage at 35.46 supports debt service
- Global presence with significant sales in China, Korea, Taiwan, and US
CRUS Strengths
- Favorable profitability metrics including 17.48% net margin and 17.01% ROE
- Very strong interest coverage at 495.45 and low debt-to-assets at 6.18%
- Focused product segments with high-performance mixed signal and portable audio
- Growing geographic footprint led by China and Hong Kong sales
- Balanced liquidity with high quick ratio of 4.82
AMAT Weaknesses
- Unfavorable high valuation multiples with PE of 26.58 and PB of 9.11
- WACC of 11.43% exceeds ROIC, indicating capital cost concerns
- Low dividend yield at 0.74% may deter income investors
- Asset turnover neutral at 0.78 suggests modest efficiency gains
- Exposure to geopolitical risks in China and Taiwan markets
CRUS Weaknesses
- Unfavorable very high current ratio at 6.35 signals potential working capital inefficiency
- Zero dividend yield limits income appeal
- PE and PB ratios only neutral, implying moderate valuation support
- Geographic concentration risks with heavy reliance on China
- Asset turnover neutral at 0.81 may restrain asset utilization
AMAT’s strengths reflect robust profitability and diversified global operations, but valuation and capital cost pose challenges. CRUS shows solid financial ratios with strong liquidity and niche products, yet efficiency and geographic concentration raise caution. Both companies demonstrate favorable overall financial health, but strategic focus on valuation and operational efficiency remains critical.
The Moat Duel: Analyzing Competitive Defensibility
A structural moat is the sole shield preserving long-term profits from relentless competitive erosion. Here’s how Applied Materials and Cirrus Logic defend their turf:
Applied Materials, Inc.: Innovation and Scale Synergy
Applied Materials leverages advanced manufacturing equipment and global service networks, creating high switching costs. Its slightly favorable moat shows value creation, but declining ROIC signals margin pressures in 2026.
Cirrus Logic, Inc.: Precision Audio Chip Specialist
Cirrus Logic’s moat rests on specialized mixed-signal technology and integrated audio solutions. Its very favorable moat reflects rising ROIC and expanding margins, indicating durable competitive strength and growth potential.
Capital Efficiency vs. Technology Specialization
Applied Materials’ scale and innovation offer a broad but slightly weakening moat. Cirrus Logic’s focused technology niche builds a deeper, more durable moat, better positioning it to defend market share in 2026.
Which stock offers better returns?
Over the past year, both Applied Materials and Cirrus Logic showed strong price appreciation, with Applied Materials demonstrating notably higher gains and increased trading activity.
Trend Comparison
Applied Materials’ stock rose 60.42% over the past 12 months, showing a bullish trend with accelerating momentum and high volatility between $127 and $327.
Cirrus Logic gained 40.5% in the same period, also bullish with acceleration but lower volatility, trading between $82 and $146.
Applied Materials outperformed Cirrus Logic in market returns, delivering stronger price growth and more pronounced trend acceleration.
Target Prices
The consensus target prices reflect moderate upside potential for these semiconductor companies.
| Company | Target Low | Target High | Consensus |
|---|---|---|---|
| Applied Materials, Inc. | 290 | 405 | 360.56 |
| Cirrus Logic, Inc. | 100 | 155 | 138.75 |
Analysts expect Applied Materials to trade roughly 13% above its current 319 price, while Cirrus Logic’s consensus target implies about 11% upside from 125. The targets highlight optimistic growth prospects relative to current valuations.
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How do institutions grade them?
Applied Materials, Inc. Grades
The following table summarizes recent grades from reputable institutions for Applied Materials, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Morgan Stanley | maintain | Overweight | 2026-02-02 |
| Mizuho | upgrade | Outperform | 2026-01-28 |
| Deutsche Bank | upgrade | Buy | 2026-01-23 |
| Needham | maintain | Buy | 2026-01-20 |
| Keybanc | maintain | Overweight | 2026-01-16 |
| Barclays | upgrade | Overweight | 2026-01-15 |
| Wells Fargo | maintain | Overweight | 2026-01-15 |
| Stifel | maintain | Buy | 2026-01-14 |
| B of A Securities | maintain | Buy | 2026-01-13 |
| Susquehanna | upgrade | Positive | 2026-01-12 |
Cirrus Logic, Inc. Grades
The following table summarizes recent grades from reputable institutions for Cirrus Logic, Inc.:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Benchmark | maintain | Buy | 2025-11-05 |
| Keybanc | maintain | Overweight | 2025-11-05 |
| Stifel | maintain | Buy | 2025-11-05 |
| Barclays | maintain | Equal Weight | 2025-11-05 |
| Susquehanna | maintain | Positive | 2025-10-22 |
| Stifel | maintain | Buy | 2025-10-17 |
| Stifel | maintain | Buy | 2025-09-12 |
| Barclays | maintain | Equal Weight | 2025-05-07 |
| Barclays | maintain | Equal Weight | 2025-04-22 |
| Stifel | maintain | Buy | 2025-04-17 |
Which company has the best grades?
Applied Materials holds stronger recent upgrades and more consistent Buy and Overweight ratings than Cirrus Logic. This suggests higher institutional confidence, potentially impacting investor sentiment and stock performance positively.
Risks specific to each company
The following categories identify critical pressure points and systemic threats facing Applied Materials, Inc. and Cirrus Logic, Inc. in the 2026 market environment:
1. Market & Competition
Applied Materials, Inc.
- Operates in highly competitive semiconductor equipment markets with rapid innovation cycles.
Cirrus Logic, Inc.
- Faces intense competition in mixed-signal processing and audio IC markets with pressure on differentiation.
2. Capital Structure & Debt
Applied Materials, Inc.
- Moderate leverage with debt-to-equity at 0.35; interest coverage strong at 35.46x.
Cirrus Logic, Inc.
- Very low leverage with debt-to-equity at 0.07; extremely high interest coverage at 495.45x.
3. Stock Volatility
Applied Materials, Inc.
- Beta at 1.68 indicates higher volatility than market benchmarks like Nasdaq-100.
Cirrus Logic, Inc.
- Beta at 1.14 suggests moderate volatility in line with sector averages.
4. Regulatory & Legal
Applied Materials, Inc.
- Exposed to global export controls and IP litigation risks inherent in semiconductor equipment.
Cirrus Logic, Inc.
- Faces regulatory scrutiny on supply chain compliance and technology licensing in mixed-signal products.
5. Supply Chain & Operations
Applied Materials, Inc.
- Complex global supply chains vulnerable to geopolitical tensions and component shortages.
Cirrus Logic, Inc.
- Relies on external foundries with risks tied to fabrication capacity and component availability.
6. ESG & Climate Transition
Applied Materials, Inc.
- High energy usage and emissions in manufacturing equipment; must adapt to tightening regulations.
Cirrus Logic, Inc.
- Lower operational footprint but increasing pressure to demonstrate sustainable sourcing and governance.
7. Geopolitical Exposure
Applied Materials, Inc.
- Significant exposure to Asia-Pacific markets, especially China, risking tariffs and export restrictions.
Cirrus Logic, Inc.
- Also exposed to Asia-Pacific but with less direct manufacturing presence, reducing geopolitical risk slightly.
Which company shows a better risk-adjusted profile?
Applied Materials faces its largest risk in geopolitical exposure, given its broad manufacturing footprint in sensitive regions. Cirrus Logic’s primary vulnerability lies in supply chain dependencies on external foundries. Cirrus Logic’s lower leverage and moderate volatility offer a more balanced risk profile. However, Applied Materials’ strong capital structure and diversified operations provide resilience. Recent data shows Cirrus Logic’s current ratio at 6.35, flagged as unfavorable, signaling potential liquidity mismanagement. Overall, Cirrus Logic edges out Applied Materials on risk-adjusted terms, but investors must monitor its liquidity and supply chain risks carefully.
Final Verdict: Which stock to choose?
Applied Materials (AMAT) stands out as a powerhouse of operational efficiency and value creation. Its ability to generate superior returns on capital amid a capital-intensive industry is impressive. However, its declining ROIC trend is a point of vigilance. AMAT fits well in aggressive growth portfolios seeking exposure to semiconductor equipment leadership.
Cirrus Logic (CRUS) boasts a durable competitive moat with a growing ROIC, reflecting increasing profitability. Its strategic focus on high-margin audio and voice ICs underpins recurring revenue safety. CRUS offers a more conservative risk profile than AMAT and suits growth-at-a-reasonable-price (GARP) investors who prioritize stability alongside expansion.
If you prioritize dynamic capital efficiency and market leadership, AMAT is the compelling choice due to its strong operational returns despite ROIC erosion. However, if you seek a durable moat with improving profitability and less valuation risk, CRUS offers better stability and a more attractive risk-reward balance. Both present favorable scenarios, but your investor profile should guide the decision.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Applied Materials, Inc. and Cirrus Logic, Inc. to enhance your investment decisions:
