Applied Materials forecast fiscal first-quarter revenue above Wall Street expectations on Nov 12, betting that strong demand for advanced AI chips will continue to fuel spending on its semiconductor manufacturing equipment.
The company, which supplies equipment for key wafer-fabrication processes, is benefiting from increased spending by chipmakers racing to meet the extraordinary AI-led demand for chips and memory.
Shares of the company were marginally higher in extended trading. The stock has risen about 48% this year.
“The actual metrics of the market show that demand is still very strong,” said Bob O’Donnell, chief analyst at TECHnalysis Research.
Applied’s results show chipmakers and foundries are “buying as much equipment as they possibly can,” he added.
The Santa Clara, California-based company’s Semiconductor Systems revenue jumped to US$8 billion (S$10.2 billion) in the fourth quarter, up about 64% from a year earlier.
The company is one of Apple’s partners for its American Manufacturing Program, which includes work at Applied’s Austin, Texas, facility to boost US production of chipmaking equipment.
“We expect 2027 to be another record year for the market and Applied,” chief executive Gary Dickerson said on a post-earnings call.
He said wafer fab equipment demand should rise more than 30% and customers are asking for tools sooner, not later.
China accounted for 25% of fourth-quarter revenue, down from 29% a year earlier, though sales there rose about 35% to US$2.64 billion.
The company forecast quarterly revenue of around US$11.10 billion, plus or minus US$500 million, compared with the average of analysts’ estimates of US$10.89 billion, according to data compiled by LSEG.
The company reported fourth-quarter adjusted profit of US$4.16 per share, beating analysts’ average estimate of US$4.05. REUTERS
