Chip Gear Maker Applied Materials Trounces Quarterly Targets, Guides Higher

Applied Materials, a company that provides equipment and services for the semiconductor and display industries, beat Wall Street's targets for its fiscal Q2 and guided higher than views for the current period. AMAT stock wavered.

Chip Gear Maker Applied Materials Trounces Quarterly Targets, Guides Higher

Applied Materials, a maker of semiconductor equipment, beat Wall Street targets late Thursday for its second fiscal quarter. It also raised guidance for the current period. AMAT's stock dipped in extended trading.

Santa Clara-based company, which has sales of $6.63billion for the quarter ending April 30, earned $2 per share adjusted. FactSet polled analysts who expected earnings of $2 a share from sales of $6.63 billion. Applied Materials' earnings increased 8% year-over-year, while its sales grew 6%.

Applied Materials forecast adjusted earnings of 1.74 cents per share for the current quarter on sales of 6.15 billion dollars. This is based on its midpoint. Wall Street expected earnings of $1.66 per share on sales $6.06 billion for the third fiscal quarter.

In a press release, Chief Executive Gary Dickerson stated that "Applied Materials delivered solid results in our second quarter fiscal year with revenues and earnings at the high end of our guidance range. We expect to outperform markets in 2023."

"Our long-term outlook is positive," he said, "as semiconductors grow to be a more important and strategic market in the world, and as major technological advancements are enabled through materials engineering. This creates outsized growth potential for Applied."

AMAT Stock Seesaws After Report

AMAT's stock fluctuated between gains and losses in today's after-hours stock trading. AMAT's stock closed at 129.92 during the regular session on Thursday.

According to IBD MarketSmith charts, AMAT hit a buying point on Wednesday of 125.72 from a cup-base. On Thursday, it remained in the buy zone of 5%.

According to IBD Stock Checkup, Applied Materials is ranked third among 29 stocks within the semiconductor equipment industry sector. IBD Composite rating of 97 is given to the shares.

IBD Composite Rating is a combination of fundamental and technical metrics that helps investors assess a stock. The best growth stocks also have a Composite rating of 90 or higher.

AMAT is also on the IBD tech leaders list.