Applying material to compound prefab

A noob question, have checked manual and this forum but am missing something.

In unity editor, created an empty GameObject to contain two child cube GameObjects. Then created a prefab from this root (parent) object. Creating instances from prefab onto scene is fine. Selected prefab, the parent, and dragged a material to its inspector. I expected the material to apply to all children contained in prefab, but nothing happens.

If I select each child within the prefab and drag the material to its inspector, the child, and any instances, do change. Is this the expected way of applying a material to a compound prefab, i.e. one by one to each child. Am I mistaken in thinking material change on a parent would propagate to its children?