Applied Materials Sees Declined Earnings; Beats Estimates (AMAT)

Applied Materials Sees Declined Earnings; Beats Estimates (AMAT)


Semiconductor-equipment maker, Applied Materials, Inc.(AMAT) reported a drop in first quarter profits, but beat estimates on Thursday.

The Santa Clara, CA based company reported first quarter earnings of $34 million, or 3 cents per share, down -70% from $117 million, or 9 cents per share last year. Excluding special items, earnings for the quarter were $69 million, or 6 cents per share, down from $240 million, or 18 cents per share last year. Analysts expected to see earnings of 3 cents per share.

Revenue declined -28% to $1.57 billion, from $2.19 billion last year. Analysts expected to see $1.55 in revenue.

During the quarter, the company saw a 84% rise in orders for semiconductor products. This surge in orders was a result of the increased demand in foundry and memory. This business accounts for 86% of the company’s total revenue.

Although demand for products is growing, the company is being hit hard by its major customers including Intel(INTL) and Samsung reducing their orders due to the slow sales of computers.

Looking ahead, the company expects to see second quarter earnings in the range of 9 cents to 15 cents per share. Analysts are forecasting 10 cents per share. AMAT sees revenue increasing by 15-25% in the next quarter, estimating revenue in the range of $1.8 billion to $1.96 billion Analysts are estimating revenue of $1.79 billion.

Applied Materials shares were up 28 cents, or 2.03% during premarket trading Thursday. The stock has increased 6% in the past year.

The Bottom Line
Shares of Applied Materials, Inc.(AMAT) have a yield of 2.61%, based on Wednesday’s closing price of $13.77.

Applied Materials, Inc.(AMAT) is not recommended at this time, holding a DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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