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WEBSITE: APPLIEDMATERIALS.COM

BLOG: BLOG.APPLIEDMATERIALS.COM

APPLIED VENTURES, LLC: APPLIEDVENTURES.COM Dear Fellow Shareholders,

Fiscal 2020 was a year marked by the COVID-19 pandemic THE WORLD IS RELYING ON TECHNOLOGY that affected nearly every country and economy in the MORE THAN EVER world. Despite the unprecedented global challenges this The role of technology in people’s lives is expanding created, Applied Materials delivered record performance. greatly as the world adapts to the challenges created by We grew revenues 18% and earnings 37% year-over- COVID-19 and prepares for the post-pandemic era. Several year and generated record annual cash from operations. major technology inflections are being accelerated as We continued to make strategic investments in new work-from-home, home schooling and online retail drive technologies and products to address the industry’s investments in cloud data centers and communications highest value problems and position Applied for sustained infrastructure. The digital transformation of companies and long-term success. In addition, we established new the economy as a whole is happening faster and driving environmental, social and governance goals and initiatives very robust semiconductor and wafer fab equipment in line with our company vision to Make Possible a Better demand. It is also broadening the long-term growth drivers Future for everyone. of the semiconductor industry from consumer-oriented PANDEMIC RESPONSE devices to non-discretionary commercial investments in the Internet of Things (IoT), Artificial Intelligence (AI) and 5G At the outset of the COVID-19 outbreak, we quickly networks. The new applications and capabilities enabled activated our business continuity teams to direct a by these technologies have the potential to reshape nearly comprehensive response across all the regions where every industry throughout the world, from healthcare to we operate. Two key principles guided our actions: first, agriculture and energy to transportation. maintaining the trust of our employees, customers, suppliers and partners; and second, focusing on driving Among the emerging technology inflections, AI in initiatives that will allow Applied to emerge stronger over particular has major implications for the electronics the longer term. and semiconductor ecosystem. AI will move us from an application-centric to data-first world where almost all data Many of our employees effectively transitioned to working will be generated and consumed by machines. In order remotely and we implemented strict safety protocols in to gain actionable insight from the massive volumes of our factories, labs and logistics centers to provide a healthy available data, a new computing approach is needed – one and productive workplace. Our teams adopted new ways that is based on workload-specific hardware built from of working using remote collaboration tools to deliver on customized and entirely new types of chips. While AI our commitments to customers and keep our technology has the ability to bring many benefits to the world, it also and product development on track. In keeping with the consumes an increasing amount of power. Therefore, major company’s long-held values to make a positive contribution improvements in the performance per watt of computing to the communities where we live and work, Applied and its solutions is required to support the sustainable growth of Foundation took action to address immediate humanitarian this major technology inflection. needs in regions around the world. We also invested resources to combat the long-term effects of thep andemic THE WAY CHIPS ARE MADE IS CHANGING on local communities and the nonprofit sector. At a time when the need for semiconductor innovation has never been greater, traditional 2D Moore’s Law scaling – the main driver of the industry’s roadmap for over 50 years – is

applied materials 2020 annual report slowing. As a result, the industry is increasingly transitioning our new 10-year sustainability roadmap. We have taken a to a new playbook for delivering improvements in the holistic approach that considers our operations, how we performance, power, area, cost and time-to-market work with customers and suppliers, and how our technology (PPACt) of semiconductor devices. This new PPACt can be used to advance sustainability on a global scale. playbook includes ﬁve key elements: the use of new We call this framework 1x–100x–10,000x, and we’ve used architectures, new structures, new materials, new ways to it to set several challenging new goals and commitments. shrink chips and new ways to connect chips together with With respect to climate change, we set a goal to reduce our advanced packaging. Scope 1 and Scope 2 carbon emissions by 50% by 2030 and to transition to 100% renewable power in the U.S. by Applied Materials is uniquely positioned to accelerate 2022 and globally by 2030. In addition, we are reinforcing this new playbook as we have the largest portfolio of our Culture of Inclusion by committing to even greater technologies to create, shape, modify, analyze and connect transparency, clearer targets and comprehensive training to chip structures and devices. The breadth of our portfolio improve diversity and inclusion within our company and in allows us to combine technologies in innovative new ways the electronics industry at large. and enable the breakthroughs in PPACt needed to unlock the potential of AI. As we enter 2021, the advances in technology needed to accelerate AI and the digital economy create tremendous A BETTER FUTURE FOR EVERYONE opportunities for Applied Materials. We have aligned our As an industry leader, Applied Materials has a responsibility strategy and investments around this vision of the future to not only deliver technology innovations that advance and look forward to bringing more technology innovations our customers’ roadmaps, but to do so in a sustainable to market, while continuing to make a meaningful difference manner. At Applied, making a positive contribution is at the in the communities where we operate and to society at foundation of our culture and our vision to Make Possible large in the years ahead. a Better Future for everyone. In ﬁscal 2020 we announced Sincerely,

Thomas J. Iannotti Gary E. Dickerson Chairman of the Board President and Chief Executive Officer

December 31, 2020

applied materials 2020 annual report This Annual Report contains forward-looking statements, including those regarding anticipated growth and trends in our businesses and markets, industry outlooks, market share, technology transitions, our business, strategies and financial performance, the impact of the ongoing COVID-19 pandemic and responses thereto on our operations and financial results, our development of new products, technologies and capabilities, and other statements that are not historical facts, and actual results could differ materially. Risk factors that could cause actual results to differ are set forth in the “Risk Factors” section of, and elsewhere in, our 2020 Annual Report on Form 10-K included in this report and other filings with the Securities and Exchange Commission. All forward-looking statements are based on management’s estimates, projections and assumptions as of the date hereof, and Applied Materials undertakes no obligation to update any such statements.

SHAREHOLDERS’ INFORMATION

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM INVESTOR CONTACT KPMG LLP Investor Relations Santa Clara, California Applied Materials, Inc. 3050 Bowers Avenue NUMBER OF REGISTERED SHAREHOLDERS P.O. Box 58039, M/S 1261 2,860 (as of December 4, 2020) Santa Clara, California 95052–8039 Tel: (408) 748–5227 STOCK LISTING Fax: (408) 986–2862 Applied Materials, Inc. is traded on Email: [email protected] The Nasdaq Global Select Market® Nasdaq Symbol: AMAT CORPORATE HEADQUARTERS Applied Materials, Inc. TRANSFER AGENT 3050 Bowers Avenue Mail correspondence to: Santa Clara, California 95054–3299 Computershare Trust Company, N.A. Stockholder Services MAILING ADDRESS AND TELEPHONE P.O. Box 505000 Applied Materials, Inc. Louisville, KY 40233-5000 3050 Bowers Avenue P.O. Box 58039 Send overnight correspondence to: Santa Clara, California 95052–8039 Computershare Tel: (408) 727–5555 462 South 4th Street, Suite 1600 Louisville, KY 40202 CORPORATE WEB SITE Additional information can be found at Online inquiries: www.appliedmaterials.com www-us.computershare.com/investor/Contact

Tel: (312) 360–5186 or (877) 388–5186 Fax: (312) 601–4348

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