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Milind Paradkar's  Instablog

Milind Paradkar works as a Research associate at Gridstone Research (http://www.gridstoneresearch.com/).
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Gridstone Research
  • Applied Materials (AMAT): Surviving Hard Times 0 comments
    May 13, 2009 06:26 AM | about stocks: AMAT, KLAC, ASML, LRCX, NVLS, VSEA, VECO, AIXG, ACLS, ASMI, ASX, AMKR, SPIL, STTS

    The world's largest chip equipment maker, Applied Materials Inc. (AMAT) announced its results for the quarter ended Apr-09 on Tuesday. Sales dropped 53% y/y to $1.02 Bn, lowest levels since 2002, but were higher than the average Wall Street estimate of $905.3 M. Operating loss widen to $293 M from $196 M in the prior quarter. GAAP loss per share stood at $0.19 compared to an income of $0.22 in the year-ago quarter.

    Results include pretax charges totaling $166 M, comprising of $77 M for equity investment impairments, $47 M for inventory write downs, $27 M for restructuring and asset impairment charges, and $15 M for bad debt provisions.

     

     

     

     

     

     

     

     

     

    (Please note: Energy and Environmental Solutions (EES) revenue growth has been plotted on the secondary axis-RHS)

     
    New Orders plunged 73% y/y and 28% q/q, dashing off hopes of any rebound in the next couple of quarters. Quarter ending backlog stood at $3.16 Bn, down 31% y/y and 23% on a sequential basis.

     

     

     

     

     

     

     

     

     

     

    Source: Gridstone Research

    Energy and Environmental Solutions (EES) orders were down 45% y/y to $141 M. EES revenue is expected to decline in Q3 due to the reductions in the number of SunFab signoffs, and a continued slowing in crystalline silicon equipment spending.
     
    Display orders dropped 97% y/y to $13 M. AMAT expects a flat growth in the global TV market for 2009, with display capital spending to be down by more than 50% for the year.
     
    Silicon Systems Group (SSG) orders were down 76% y/y and up 5% q/q to $259 M. AMAT is seeing a slow uptick in the SSG end markets and expects orders to improve in Q3 sequentially.

     

     

     

     

     

     

     

     

    (Please note: Energy and Environmental Solutions, and Display order growth has been plotted on the secondary axis-RHS)
     
    Guidance for Q3-FY09
    Overall revenue is expected to be flat to down 15% q/q, with loss per share in the range of $0.06-0.14. SSG is expected to be flat to up 40%, while Services to be up by more than 5%. Display and EES revenue is expected to decline by approx. 50% and atleast 30% respectively.
     
    AMAT Shares fell 2.5 % to $11.19 in after-hours trade on Tuesday from their close of $11.48 on NASDAQ.
     
    Disclosures: No positions
     
    Themes: SEMIS Stocks: AMAT, KLAC, ASML, LRCX, NVLS, VSEA, VECO, AIXG, ACLS, ASMI, ASX, AMKR, SPIL, STTS
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