Chip equipment supplier Applied Materials reported better than expected fiscal fourth quarter earnings after the market close Thursday. Last quarter $AMAT showed a 44% dip in earnings as weak performance from all three segments hurt net sales.
Chip equipment supplier Applied Materials reported better than expected fiscal fourth quarter earnings after the market close Thursday. Last quarter $AMAT showed a 44% dip in earnings as weak performance from all three segments hurt net sales.
Applied Materials, Inc. NASDAQ: AMAT Reported Earnings After Close Thursday
$0.80 Beat $0.76 EPS AND $3.754 Beat $3.68 Billion Revenue Forecast
Earnings
Applied Materials announced its fourth-quarter earnings after the close Thursday with Adj. EPS $0.8 on Sales of $3.754B which beat analysts estimated earnings of $0.76 per share on revenue of $3.68 billion. This compares to earnings of $0.97 per share on revenue of $4.01 billion reported a year earlier. GAAP EPS of $0.75 was in-line.
Last quarter, Applied Materials saw revenue declines in all three business divisions due to a challenging market environment. The company has been focusing on developing new products and capabilities and this might help it see a pickup in the fourth quarter results.
Applied Materials, Inc. NASDAQ: AMAT
Market Reaction – After hours $59.00 +2.04 (+3.58%)
Highlights
- On a GAAP basis, the company recorded gross margin of 43.5 percent, operating income of $864 million or 23.0 percent of net sales, and earnings per share (EPS) of $0.75.
- On a non-GAAP adjusted basis, the company reported gross margin of 43.8 percent, operating income of $888 million or 23.7 percent of net sales, and EPS of $0.80.
- The company returned $694 million to shareholders including $500 million in share repurchases and dividends of $194 million.
Outlook
Applied Materials Sees Q1 Adj. EPS $0.87-$0.95 vs $0.74 Estimate, Sales $4.1B +/- $150M vs $3.71B Est.
Applied Materials Q3 Earnings Recap
$0.74 Beat $0.70 EPS AND $3.56B Beat $3.52 Billion Revenue Forecast
Earnings
Applied Materials announced its third-quarter earnings of adjusted earnings per share of 74 cents on revenue of $3.56 billion. Analysts expected earnings per share of 70 cents on revenue of $3.52 billion, according to Refinitiv. Net income plunged by 44% to $571 million or $0.61 per share.
Gary Dickerson, president and CEO, said going forward the company is “fully funding our R&D programs to develop new products and capabilities”.
Applied Materials, Inc. NASDAQ: AMAT
Market Reaction – After hours $46.99 −0.17 (-0.36%)
Highlights
- During the third quarter, sales declined in the all the three segments: Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets.
- From a geography perspective, the double-digit sales growth in the US and Taiwan were hampered by weak sales from other regions.
- The company has been struggling in the challenging market environment.
- Applied Materials gets majority of the revenue contribution from Asia Pacific region, with China being a significant benefactor. The trade war between the US and China turned out to be a major headwind in the contribution from China.
Outlook
- Looking ahead into the fourth quarter, the company expects net sales to be about $3.685 billion, plus or minus $150 million.
- Adjusted earnings are anticipated to be in the range of $0.72 to $0.80 per share.
Source: AMAT; AlphaStreet
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