A technician works on a computer at the Applied Materials Inc. facility in Santa Clara, California <\/p>\n
(Bloomberg) \u2014 Applied Materials Inc. suffered the worst single-day stock decline in five years after giving a disappointing sales and profit forecast, renewing concerns that the US trade dispute with China is weighing on demand.<\/p>\n
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Revenue will be approximately $6.7 billion in the fiscal fourth quarter, the company said in a statement Thursday. Analysts had estimated $7.32 billion on average. Profit will be about $2.11 a share, excluding some items, compared with a projection of $2.38.<\/p>\n
Applied Materials CEO Gary Dickerson said tariffs and other economic issues have brought \u201ca level of uncertainty.\u201d Photographer: I-Hwa Cheng\/Bloomberg <\/p>\n
Applied Materials, the largest American producer of chipmaking gear, is seeing less demand from customers in China, Chief Executive Officer Gary Dickerson said in an interview. It also faces delays in approval for exporting technology to that country, he said. Moreover, large customers are putting off some purchases in the face of prolonged negotiations around tariffs and other economic issues.<\/p>\n
\u201cIt just creates a level of uncertainty,\u201d Dickerson said.<\/p>\n
The outlook sent shares of Applied Materials down 14% on Friday, the most since the early days of the pandemic in March 2020. They had been up 16% this year heading into the report.<\/p>\n
In the third quarter, which ended July 27, revenue rose 7.7% to $7.3 billion. Analysts had anticipated $7.21 billion on average, according to data compiled by Bloomberg. Profit was $2.48 a share, compared with an estimate of $2.36.<\/p>\n
Applied Materials\u2019 customer ranks include some of the biggest names in the chip industry, such as Taiwan Semiconductor Manufacturing Co., Samsung Electronics Co. and Intel Corp. Those manufacturers order gear well ahead of starting production, making Applied Materials\u2019 forecasts a barometer for future demand.<\/p>\n
The company said last week that it would participate in an Apple Inc. plan to boost manufacturing in the US by spending more than $200 million on a facility in Arizona. Applied Materials will also sell equipment to Texas Instruments Inc.\u2019s US factories to support Apple products.<\/p>\n
\u201cApplied Materials\u2019 decision to be a core member of Apple\u2019s \u2018American Manufacturing Program,\u2019 a drive to increase factory production within the US, could strengthen its position as a key supplier of chipmaking tools for advanced semiconductors used in iPhones,\u201d Bloomberg Intelligence analyst Masahiro Wakasugi said in a note.<\/p>\n
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\u201cThe new administration is very focused on increasing semiconductor supply in the United States,\u201d Dickerson said on Thursday. \u201cWe\u2019re very positive.\u201d<\/p>\n
In July, rival Lam Research Corp. said revenue for the quarter ending in December would ease from the current-quarter levels, with Chinese customers potentially scaling back after a spending spree.<\/p>\n
In a further sign of US-China tensions, Applied Materials was recently sued by Beijing E-Town Semiconductor Technology Co. over what that company characterized as trade secret theft.<\/p>\n
Still, Dickerson said the long-term demand outlook for computing power remains strong. Customers in China had significantly ramped up buying in recent years, and are now just digesting those purchases, he said.<\/p>\n
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\u00a92025 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"A technician works on a computer at the Applied Materials Inc. facility in Santa Clara, California (Bloomberg) \u2014…\n","protected":false},"author":3,"featured_media":148780,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[77291,3638,276,74,87639,51,50,55734,52],"class_list":{"0":"post-148779","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-news","8":"tag-applied-materials","9":"tag-bloomberg","10":"tag-california","11":"tag-china","12":"tag-gary-dickerson","13":"tag-headlines","14":"tag-news","15":"tag-santa-clara","16":"tag-top-stories"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115034818206999700","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/148779","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=148779"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/148779\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/148780"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=148779"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=148779"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=148779"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}