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It has been about a month since the last earnings report for Applied Materials (AMAT). Shares have added about 5.1% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Applied Materials due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Applied Materials Q4 Earnings & Sales Top Estimates

Applied Materials Inc. reported fiscal fourth-quarter 2019 non-GAAP earnings of 80 cents per share, which beat the Zacks Consensus Estimate by 4 cents and improved 8.1% sequentially. However, the figure declined 5.9% year over year.

Net sales of $3.75 billion surpassed the Zacks Consensus Estimate by 1.9% and were within management’s guided range of $3.535-$3.835 billion. The figure improved 5.3% from the fiscal third quarter but marginally decreased0.1% from the year-ago period.

The company witnessed solid momentum in key geographies namely United States, China and Taiwan. Additionally, strong investments by foundry logic customers and acceleration of the 5G roadmap drove fiscal fourth-quarter results.

Following strong fiscal fourth-quarter results, its shares were up 4% in after-hours trading. Encouragingly, the company provided strong guidance for first-quarter fiscal 2020.

Let’s delve deeper into the numbers.

Segments in Detail

The Semiconductor Systems Group generated $2.3 billion sales in the reported quarter(contributing 61% to its net sales), reflecting an increase of 2.5% year over year.

Applied Global Services reported sales of $977 million (26% of net sales), which increased 0.1% from the prior-year quarter.

Sales from the Display and Adjacent Markets came in at $457 million (13% of net sales), down 12.1% from the year-ago level.

Revenues by Geography

United States, Europe, Japan, Korea, Taiwan, Southeast Asia and China generated sales of $412 million, $147 million, $471 million, $471 million, $919 million, $135 million and $1.20 billion, contributing 11%, 4%, 13%, 13%, 24%, 3% and 32% to net sales, respectively.

We note that sales in United States, Taiwan and China were up 17.7%, 55.5%and 5.5% year over year, respectively. However, Applied Materials’ sales in Europe, Japan, Korea and Southeast Asiadeclined39%, 33.8%, 11.5% and 31.5%, respectively.

Operating Results

Non-GAAP gross margin was 43.8%, contracting150 basis points (bps) from the year-ago quarter.

Applied Materials’ adjusted operating expenses, as a percentage of net sales, contracted 10 bps on a year-over-year basis to 20.5%.