Applied Materials Gives Sales Forecast That Tops Estimates

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Applied Materials Inc. gave a bullish revenue forecast for the current period on increasing orders for equipment used by makers of computer chips.

The Santa Clara, California-based company is the largest maker of equipment used to produce semiconductors, the most important components of electronic devices. Its customers include Samsung Electronics Co., Taiwan Semiconductor Manufacturing Co. and Intel Corp.

Investors track demand for Applied Materials as a future indicator for products ranging from personal electronics to data center servers. Chipmakers order machinery a year ahead of their anticipated need.

Key Insights

  • Revenue in the fiscal first quarter will be about $4.95 billion, the company said Thursday in a statement. Analysts, on average, estimated $4.52 billion, according to data compiled by Bloomberg.
  • Profit, on an adjusted basis, will be $1.20 to $1.32 per share in the three-month period ending in January, Applied Materials said. That compares with an average estimate of $1.11.
  • Fiscal fourth-quarter net income rose to $1.13 billion, or $1.23 a share, from $698 million, or 75 cents, from the period a year earlier, the company said. Revenue gained 25% to $4.69 billion in the period ended Oct 25. Analysts were looking for $4.6 billion.
  • Adjusted profit was $1.25 a share in the quarter compared with analysts’ average estimate of $1.17.

Executive Comments

  • “Our future opportunities have never looked better and, as powerful technology trends take shape, we are uniquely positioned to accelerate our customers’ road maps and outperform our markets,” Chief Executive Officer Gary Dickerson said in the statement.

Stock Reaction

  • Shares gained about 3% in extended trading after the results were released. The stock closed at $69.80 in New York, leaving it up 14% this year.

More Information

  • For more details, click here.
  • To see the statement, click here.

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