(Bloomberg) — Applied Materials Inc., the largest US maker of chip-manufacturing equipment, gave a lukewarm revenue forecast for the current period, citing the risk of export controls crimping its business.
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Sales will be about $7.1 billion in the fiscal second quarter, which runs through April, the company said in a statement Thursday. That compares with an average Wall Street estimate of $7.22 billion. Profit will be $2.30 a share, Applied Materials said, in line with projections.
Chief Financial Officer Brice Hill said the company was “taking into account export control related headwinds.” China makes up roughly a third of the company’s sales, and stricter trade curbs from the US have made it harder to sell in that country.
Applied Materials also is facing tax changes in Singapore, resulting in an expense of $644 million, or 79 cents a share, during fiscal 2025.
Applied Materials shares fell about 3% in extended trading following the announcement. They had earlier closed at $184.27, up 13% for the year.
First-quarter profit was $2.38 a share, excluding some items, compared with an estimate of $2.28. Revenue gained 6.8% to $7.17 billion. Analysts projected $7.15 billion.
Applied Materials’ management has maintained confidence in the overall growth of the industry. The rapid spread of semiconductors to new products and the AI boom will help maintain demand, Chief Executive Officer Gary Dickerson has argued. The sheer complexity of chips also has added pressure on customers to upgrade their equipment.
Applied Materials’ customer ranks include some of the biggest names in the chip industry, including Taiwan Semiconductor Manufacturing Co., Samsung Electronics Co. and Intel Corp. Those manufacturers order gear well ahead of starting production, making Applied Materials’ forecasts a barometer for future demand.
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