Applied Materials Inc, the largest US maker of chip-manufacturing equipment, gave a lackluster forecast for the current period, highlighting the potential cost of the US trade dispute with China.
Sales would be about US$7.2 billion in the fiscal third quarter, plus or minus US$500 million, the company said in a statement on Thursday.
That was about in line with Wall Street estimates, although some analysts projected as much as US$7.4 billion. Profit would be about US$2.35 a share.
Photo: Reuters
Applied Materials and other chip-industry companies are adjusting to restrictions on sales to China, one of the biggest markets for their products.
The impact of tariffs imposed by Washington are also making it more difficult to project future revenue.
“There is more uncertainty in the market,” Applied Materials chief executive officer Gary Dickerson said in an interview.
“Despite that, the company is performing incredibly well,” he added.
Applied Materials shares fell more than 4 percent in extended trading following the announcement. They had earlier closed at US$174.75, leaving the stock up 7.5 percent for this year.
Applied Materials in February said rules adopted in the final months of former US president Joe Biden’s administration would knock about US$400 million off fiscal revenue for this year.
That is because Applied Materials would have to stop servicing equipment at some customer sites in China. However, technology export restrictions have continued to evolve under US President Donald Trump.
China accounted for 25 percent of Applied Materials sales previous quarter, down from 43 percent a year earlier.
Fiscal-second quarter profit was US$2.39 a share, excluding some items, compared with an analyst prediction estimate of US$2.31.
Revenue rose 7 percent to US$7.1 billion in the period, which ended on April 27, in line with estimates.
Demand remains strong for machines needed to make high-end processors for AI computing, but orders for less complex machinery used to make cars and industrial components have slowed, Dickerson said.
Applied Materials’ management has said that the industry is in a historic period of expansion. The rapid spread of semiconductors to new products and the AI boom would help maintain demand, Dickerson has said.
The sheer complexity of chips has also 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. (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 future demand.
To many, Tatu City on the outskirts of Nairobi looks like a success. The first city entirely built by a private company to be operational in east Africa, with about 25,000 people living and working there, it accounts for about two-thirds of all foreign investment in Kenya. Its low-tax status has attracted more than 100 businesses including Heineken, coffee brand Dormans, and the biggest call-center and cold-chain transport firms in the region. However, to some local politicians, Tatu City has looked more like a target for extortion. A parade of governors have demanded land worth millions of dollars in exchange
An Indonesian animated movie is smashing regional box office records and could be set for wider success as it prepares to open beyond the Southeast Asian archipelago’s silver screens. Jumbo — a film based on the adventures of main character, Don, a large orphaned Indonesian boy facing bullying at school — last month became the highest-grossing Southeast Asian animated film, raking in more than US$8 million. Released at the end of March to coincide with the Eid holidays after the Islamic fasting month of Ramadan, the movie has hit 8 million ticket sales, the third-highest in Indonesian cinema history, Film
BIG BUCKS: Chairman Wei is expected to receive NT$34.12 million on a proposed NT$5 cash dividend plan, while the National Development Fund would get NT$8.27 billion Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday announced that its board of directors approved US$15.25 billion in capital appropriations for long-term expansion to meet growing demand. The funds are to be used for installing advanced technology and packaging capacity, expanding mature and specialty technology, and constructing fabs with facility systems, TSMC said in a statement. The board also approved a proposal to distribute a NT$5 cash dividend per share, based on first-quarter earnings per share of NT$13.94, it said. That surpasses the NT$4.50 dividend for the fourth quarter of last year. TSMC has said that while it is eager
‘IMMENSE SWAY’: The top 50 companies, based on market cap, shape everything from technology to consumer trends, advisory firm Visual Capitalist said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was ranked the 10th-most valuable company globally this year, market information advisory firm Visual Capitalist said. TSMC sat on a market cap of about US$915 billion as of Monday last week, making it the 10th-most valuable company in the world and No. 1 in Asia, the publisher said in its “50 Most Valuable Companies in the World” list. Visual Capitalist described TSMC as the world’s largest dedicated semiconductor foundry operator that rolls out chips for major tech names such as US consumer electronics brand Apple Inc, and artificial intelligence (AI) chip designers Nvidia Corp and Advanced
RSS