Applied Materials forecast first-quarter revenue below Wall Street estimates on Thursday, a sign of sluggish demand for the chipmaking equipment outside of AI-powered chips, sending its shares down nearly 4% in extended trading.
Despite the strong need for leading-edge equipment for AI chips, the weakness in certain markets has kept the spending slow, hitting demand for firms such as Applied Materials.
Moreover, stricter export curbs on high-end chips and certain equipment to China from the United States have kept the uncertainty lingering on both tools suppliers and chip firms.
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Applied also faces competition from other chipmaking equipment suppliers such as KLA Corp, Lam Research and Europe’s ASML Holding.
Rival ASML had forecast lower-than-expected 2025 sales and bookings earlier in October on sustained weakness in parts of the semiconductor market despite a boom in AI-related chips.
The semiconductor equipment maker expects first-quarter revenue of about $7.15 billion, plus or minus $400 million, below analysts’ average estimate of $7.22 billion, according to data compiled by LSEG.
It forecast adjusted profit per share of about $2.29, plus or minus $0.18, which was above estimates of $2.27.
Revenue rose five per cent to $7.05 billion for the fourth quarter ended Oct. 27, beating estimates of $6.95 billion. Adjusted profit per share of $2.32 also beat estimates of $2.19.
(Reporting by Jaspreet Singh in Bengaluru; editing by Alan Barona)
