On Thursday Applied Materials issued a Q2 outlook that was well above expectations, driven by rising demand for semiconductor manufacturing equipment, fueled by the boom in artificial intelligence and a global memory shortage. The company expects revenue of about $7.65bn, plus or minus $500m, compared with the $7.01bn forecast by analysts. EPS is expected at around $2.64, with a margin of $0.20, well above the consensus of $2.28.
The stock jumped over 11% in after-hours trading, lifting other sector players such as Lam Research and KLA, up over 2%. Chief Executive Gary Dickerson said ramping investment in AI infrastructure is boosting demand for advanced logic technologies, high-bandwidth memory (HBM) and sophisticated packaging techniques. HBM, which is essential to high-end AI processors such as Nvidia's, is at the center of a sharp squeeze in global supply.
Applied Materials posted Q1 revenue of $7.01bn, above expectations, and adjusted EPS of $2.38, versus $2.20 expected. Revenue from the division focused on DRAM memory tools rose 34%, accelerating from the 27% recorded a year earlier. Against a backdrop of strong demand and targeted shortages, the group says it is well positioned in the strategic AI market, with solid near-term prospects.
Applied Materials, Inc. specializes in the design, manufacture, and marketing of equipment for producing integrated circuits and semi-conductor components. The group develops systems used in the principal manufacturing stages of microchips (deposition systems using chemical vapors, the physical process or through epitaxy, photomasking systems, control programs, etc.).
Net sales break down by activity sector as follows: semiconductor industry (73.3%), flat screen industry (22.5%) and other (4.2%; photovoltaic and electronic industries).
Net sales are distributed geographically as follows: the United States (10.8%), China (30.1%), Taiwan (24.2%), Korea (19.8%), Japan (8%), Asia (3.8%) and Europe (3.3%).
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