Applied Materials, Inc. (AMAT) Covered Calls

Applied Materials, Inc. covered calls Applied Materials, Inc. is the global leader in materials engineering solutions used to produce virtually every new chip and advanced display in the world. The company provides manufacturing equipment, services, and software to the semiconductor, display, and adjacent industries. Its expertise in modifying materials at atomic levels enables chipmakers to improve performance, power, and yield for technologies driving AI, cloud computing, and the Internet of Things.

You can sell covered calls on Applied Materials, Inc. to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for AMAT (prices last updated Tue 4:16 PM ET):

Applied Materials, Inc. (AMAT) Stock Quote
Last Change Bid Ask Volume P/E Market Cap
329.07 -1.50 329.25 330.24 6.0M 38 262
Covered Calls For Applied Materials, Inc. (AMAT)
Expiration Strike Call Bid Net Debit Return
If Flat		 Annualized
Return If Flat
Feb 20 330 12.75 317.49 4.1% 136%
Mar 20 330 22.60 307.64 7.4% 69.3%
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Extended Business Description

Core Business and Products

Applied Materials, Inc. (AMAT) is the world’s largest manufacturer of wafer fabrication equipment (WFE). As of February 2026, the company has positioned itself as the "architect of the silicon renaissance," moving beyond simple tool sales to providing integrated materials engineering. Its business is powered by three primary segments:

  1. Semiconductor Systems: This core segment provides the high-tech machinery for deposition, etch, ion implantation, and metrology. In 2026, AMAT leads the industry transition to Gate-All-Around (GAA) transistors and Backside Power Delivery (BSPD). These radical new architectures require the precise atomic-level material manipulation where AMAT holds a dominant market share, often increasing its revenue per wafer by 30% compared to previous nodes.
  2. Applied Global Services (AGS): A critical recurring revenue engine, AGS provides spare parts, maintenance, and proprietary automation software. In 2026, over 90% of its service contracts are multi-year subscriptions, insulating the company from the historical "boom and bust" cycles of the semiconductor industry.
  3. Display and Adjacent Markets: This segment serves manufacturers of high-resolution OLED and flexible displays for mobile devices and TVs. While smaller than the semiconductor unit, it remains a high-margin leader in display technology.

Competitive Landscape

AMAT operates in a highly specialized, capital-intensive market where it competes for the multi-billion dollar expansion budgets of foundries like TSMC, Samsung, and Intel:

  1. Direct Equipment Rivals: AMAT’s primary competitor is Lam Research, particularly in the etching and deposition categories. While Lam is a leader in high-aspect-ratio memory etching, AMAT maintains a broader portfolio across logic and foundry. It also competes with Tokyo Electron and the Dutch firm ASM International (which remains unlinked as it does not trade on the NYSE/NASDAQ).
  2. Complementary Players: AMAT works in tandem with ASML (lithography) and KLA Corporation (process control). While they are not direct competitors, they all vie for the same pool of Capital Expenditure (CapEx) from global chipmakers.
  3. Process Control Competitors: In the metrology and inspection space, AMAT competes with KLA Corporation, though KLA remains the dominant leader in that specific niche.

Strategic Outlook and Innovation

Entering February 2026, Applied Materials is capitalizing on the "AI Infrastructure Supercycle." The company recently operationalized its "EPIC Center" in Silicon Valley, a multi-billion dollar R&D hub where it co-innovates with customers years before chips enter production. Management projects a total WFE market of $134 billion for 2026, a 13% year-over-year increase. A major strategic priority is "Integrated Materials Solutions," which combines multiple manufacturing steps into a single vacuum system to reduce defects. Despite ongoing trade restrictions in certain international markets, AMAT is forecasting double-digit growth for 2026, driven by the mass production ramp of 2nm and 1.4nm chips. With an operating margin near 30% and a record R&D budget exceeding $3.5 billion, Applied Materials remains the foundational provider for the global AI and high-performance computing era.