External Use

Global Engineering Collaboration

Using CAD in the Cloud

Brendan Hickey

Director, PLM and Collaboration

Applied Materials

Email: brendan_hickey@amat.com

GPU Technology Conference, San Jose

March, 2013

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This presentation may contain forward-looking statements, including

those regarding Applied’s industry outlooks, opportunities and Q2’13

expectations. Forward-looking statements are subject to known and

unknown risks and uncertainties that could cause actual results to differ

materially from those expressed or implied by such statements,

including uncertain global economic and industry conditions, demand

for electronic products and semiconductors, and customers’ new

technology and capacity requirements; the concentrated nature of

Applied’s customer base; and other risks described in Applied’s most

recent Forms 10-Q and 10-K filed with the SEC. All forward-looking

statements are based on management’s estimates, projections and

assumptions as of February 13, 2013, and Applied undertakes no

obligation to update any forward-looking statements.

This presentation may also contain non-GAAP financial measures,

along with reconciliation information.

Safe Harbor Statement

2 Corporate Overview – Data as of

FYQ1’13

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Enabling and Accelerating Innovation

Global Information Systems 3

Applied Materials is the

global leader in providing

manufacturing solutions for the

semiconductor, flat panel display

and solar photovoltaic industries

Stock Ticker: Nasdaq: AMAT

Market Cap*: $16.4 billion

FY 2012 Revenue**: $8.7 billion

FY 2012 R&D**: $1.2 billion

Founded: November 10, 1967

Headquarters: Santa Clara, California

Fortune 500 Ranking: 251

Employees***: ~13,700 worldwide

Patents: ~10,300 issued

The Global Strength of Applied

* As of February 11, 2013.

** Fiscal year-end October 28

*** Excluding temporary and interns

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Solar

The Most Exciting Industries on Earth

Global Information Systems 4

20,000,000x reduction in

COST PER TRANSISTOR

in 30 years1

20x reduction in

COST PER AREA

in 15 years2

5x reduction in

COST PER WATT

in 4 years3

In 1976, a 32GB smartphone

would have cost more than

4 BILLION DOLLARS 1 Source: SIA, IC Knowledge LLC

2 Source: Display Search, Nikkei BP, Applied Materials

3 Source: Photon Consulting 2012

Display Semiconductor

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Global Scale and Reach

Switzerland

Taiwan

China

Germany

Italy

Singapore

Israel

California

5 Global Information Systems

Texas

Montana

Massachusetts India

Global Concurrent Engineering – 90 locations in 19 countries

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Internet

o Engineering desktops & applications are hosted in Applied datacenters

o Connect from anywhere with a notebook computing device – and use server CPU/GPU

o Applications are run on powerful servers connected to enterprise data via hyperLAN

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Internet

Traditional Multisite Private Desktop Cloud

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Applied’s CAD Solution: Internal Desktop CAD “Cloud”

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Applied’s CAD Solution: Desktop Cloud for Engineers

Santa Clara

Kalispell, MT

Austin

Amsterdam Germany

Switzerland

Italy Japan

Singapore

Tainan

Xi’an

Bangalore

North America

Asia

Europe

S. Korea

Israel

3000+ global engineers are supported by 3 consolidated data centers

Gloucester, MA

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CAD Desktop Cloud: Results by the Numbers

Multisite synchronization transaction reduction

Multisite synchronization errors reduction

Large Assembly load-time reduction

Large assembly load failures from memory limit

CAD users working from home (% of total hours)

CAD users satisfaction improvement

Simulation performance improvements

Maximum assembly size in production (Full load)

> 4X

> 3.5X

> 2X

~0

> 6%

> 30%

> 1.8X

> 15GB

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Challenges of Internal Desktop CAD “Cloud” GPU acceleration

– Applied’s solution was first deployed >4 years ago – no GPU passthrough or virtualization available.

– Until 2012, all sessions are real-mode – 1 user per (workstation) server. Session brokering in use, overall ~1.7 users per server.

– Citrix VDI now in use for non-authors (e.g. buyers, manufacturing etc.). We would prefer a cost effective GPU accelerated solution.

– Multi-tenant solution in POC. New servers will have 2xGPU. Note server density is a major cost factor, GPU side car impacts density.

Budget Justification

– ROI demonstrated through enabling work beyond the office. Payback in under 18 months including all infrastructure (>1,000 servers)

Adoption: skeptical users, wariness around moving data from local to central locations

– Sufficient user benefits needed to overcome perceived risks (mobility, new capabilities, performance)

– Zero performance degradation is minimum required.

– Communicate clearly to users where data is stored, and how / when it moves

– The best presentation is a demonstration.

Performance and Capacity: Very high demands placed on network and storage

– Once users are able to create very large assemblies, they will

– Data must be able to move easily and quickly between storage locations – e.g. workspaces, suppliers

– Architecture and infrastructure should be thoroughly tested to ensure capability to handle additional load.

– Constant monitoring required.

Skillset / capability requirements

– Vendor assistance is key to ensure successful application transition. Autodesk proved particularly helpful.

– Image management: Increase in central management of applications, requires significant change management and new expertise.

– New images must be released in under 6 hours to 1000’s of computers worldwide.

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External Cloud Vs. Internal “Cloud’

External and internal clouds can coexist, it is not necessarily an either / or decision

Key impediments to moving enterprise apps to external cloud (in no particular order)

– Higher level of “trust” is required where sensitive IP is involved

– Integration to corporate ERP, PDM and custom applications

– Managing customer IP , ITAR requirements

– Moving large datasets quickly between applications

– Budgeting, Op Ex versus Cap Ex. Cost of “read users” versus authors

– Fear of lock-in

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For 4 years, Applied Materials has run a private

internal desktop CAD “cloud”

In addition, Applied runs email, HR applications, and

other point solutions in external cloud.

External cloud solutions are attractive – lower

infrastructure costs, lower overhead and easier to

scale Source: http://www.vi.net/blog

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Benefits of CAD Desktop Cloud

Collaboration: Global access to data and applications

Synchronization: Complexity & transactions greatly reduced

Computing Power: Blade power available to CAD users

Mobility: Users can easily work remotely and from home

Security: Data does not leave the data centers

Onboarding: Instant access to applications and data

User Satisfaction: Vast improvement in user scorecards

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Questions?

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