Applied Materials Inc, the largest US maker of chip-manufacturing equipment, on Thursday gave a lukewarm revenue forecast for the current period, citing the risk of export controls crimping its business.
Sales would be about US$7.1 billion in the fiscal second quarter, which runs through April, the company said in a statement.
That compares with an average Wall Street estimate of US$7.22 billion.
Photo: Reuters
Profit per shares would be US$2.30, Applied Materials said, in line with projections.
Applied Materials chief financial officer Brice Hill said the company was “taking into account export control related headwinds.”
China makes up about one-third of the company’s sales and stricter trade curbs from the US have made it harder to sell in that nation.
The company’s shares fell about 5 percent in extended trading following the announcement. They had earlier closed at US$184.27, up 13 percent this year.
Export rules adopted in the final months of the administration of former US president Joe Biden would knock about US$400 million off revenue this fiscal year, the company said.
About half of the reduction would come in the current period, with much of it hitting Applied Materials’ service business.
That is because the company would have to stop servicing equipment at some customer sites in China, Applied Materials chief executive officer Gary Dickerson said on a conference call with analysts.
In the long term, Dickerson said he expects the company’s service operations to resume healthy growth.
China accounted for 31 percent of sales last quarter, down from 45 percent a year earlier.
A surge in orders from Chinese memorychip makers has not continued into this year, the company said.
Meanwhile, Applied Materials is enjoying high demand for the most advanced types of equipment needed for artificial intelligence (AI) components, Dickerson said.
That is making up for weaker demand from makers of less complicated chips, he said.
“The biggest driver for the whole industry is AI,” he said.
The amount of silicon going into data centers — facilities that handle much of the AI workload — will soon surpass the level consumed by personal computers and smartphones.
Those have traditionally been the two biggest markets for chipmakers.
First-quarter profit was US$2.38 per share, excluding some items, compared with an estimate of US$2.28. Revenue gained 6.8 percent to US$7.17 billion. Analysts projected US$7.15 billion.
The company is facing tax changes in Singapore, resulting in an expense of US$644 million, or US$0.79 per share during this fiscal year.
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 would help maintain demand, Dickerson said.
The sheer complexity of chips has also added pressure on customers to upgrade their equipment, he said.
Customers of Applied Materials include some of the biggest names in the chip industry, including Taiwan Semiconductor Manufacturing Co (台積電), Samsung Electronics Co and Intel Corp. Those manufacturers order gear well ahead of starting production, making Applied Materials’ forecasts a barometer for demand.
The Eurovision Song Contest has seen a surge in punter interest at the bookmakers, becoming a major betting event, experts said ahead of last night’s giant glamfest in Basel. “Eurovision has quietly become one of the biggest betting events of the year,” said Tomi Huttunen, senior manager of the Online Computer Finland (OCS) betting and casino platform. Betting sites have long been used to gauge which way voters might be leaning ahead of the world’s biggest televised live music event. However, bookmakers highlight a huge increase in engagement in recent years — and this year in particular. “We’ve already passed 2023’s total activity and
Nvidia Corp CEO Jensen Huang (黃仁勳) today announced that his company has selected "Beitou Shilin" in Taipei for its new Taiwan office, called Nvidia Constellation, putting an end to months of speculation. Industry sources have said that the tech giant has been eyeing the Beitou Shilin Science Park as the site of its new overseas headquarters, and speculated that the new headquarters would be built on two plots of land designated as "T17" and "T18," which span 3.89 hectares in the park. "I think it's time for us to reveal one of the largest products we've ever built," Huang said near the
China yesterday announced anti-dumping duties as high as 74.9 percent on imports of polyoxymethylene (POM) copolymers, a type of engineering plastic, from Taiwan, the US, the EU and Japan. The Chinese Ministry of Commerce’s findings conclude a probe launched in May last year, shortly after the US sharply increased tariffs on Chinese electric vehicles, computer chips and other imports. POM copolymers can partially replace metals such as copper and zinc, and have various applications, including in auto parts, electronics and medical equipment, the Chinese ministry has said. In January, it said initial investigations had determined that dumping was taking place, and implemented preliminary
Intel Corp yesterday reinforced its determination to strengthen its partnerships with Taiwan’s ecosystem partners including original-electronic-manufacturing (OEM) companies such as Hon Hai Precision Industry Co (鴻海精密) and chipmaker United Microelectronics Corp (UMC, 聯電). “Tonight marks a new beginning. We renew our new partnership with Taiwan ecosystem,” Intel new chief executive officer Tan Lip-bu (陳立武) said at a dinner with representatives from the company’s local partners, celebrating the 40th anniversary of the US chip giant’s presence in Taiwan. Tan took the reins at Intel six weeks ago aiming to reform the chipmaker and revive its past glory. This is the first time Tan
RSS