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Company Profile:

Applied Materials

Why: Powerful computing devices are proliferating because of chips that incorporate every-smaller features without rising in price.

Key innovation: its machines can make chips that have both vertical and horizontal connections, to pack in more computing power.


As semiconductor manufacturers begin to reach the limits of how many transistors can be crammed onto a chip horizontally, they have begun adding them vertically, stacking connected chips on top of each other. But it has proven difficult to fill the tiny gaps between transistors to keep them electrically isolated from one another. Applied Materials has developed a new chemical vapor deposition tool that allows them to fill these gaps with insulating material at a scale below 20 nanometers. Display manufacturers are using Applied Materials' equipment to deposit thin films on glass or flexible substrates to create more complex and responsive touch panels.


The coming wave of tablet computers—analysts predict some 55 million will be sold in 2011—has created a huge demand for Applied Materials' equipment. Combining its semiconductor and display businesses, Applied Materials claims that 60 percent of the components of a typical tablet computer are made using its equipment. The company expects that the touch screen market alone represents a $200 million opportunity for the company this year.


The next generation of smart phones and tablets will require chips that are more powerful, compact, and energy-efficient, as well as brighter, more energy-efficient touch screens. Chipmakers are already testing the next generation of solid-state memory chips using Applied Materials' new deposition technology, and logic chips will not be far behind. Its equipment for manufacturing flat panel displays for televisions and computers is now being used to build more complex and responsive touch screens.

Challenges and Next Steps:

The company is also developing equipment for manufacturing organic light-emitting diodes, which can be used to create brighter displays for portable devices without draining the battery, and which may eventually be used to light homes and buildings more efficiently.

Public Company: Applied Materials
Headquarters: Santa Clara, California
Founded: 1967
Employees: 13,057
Revenues: $9.6 billion
R&D: $1.1 billion
Market Capitalization: $17 billion


Michael Splinter (CEO)

Omkaram Nalamasu (CTO)