Applied Materials reported fiscal Q3 net income fell 7.5% to $473.5 million, or $0.34/share on sales growth of less than 1% to $2.56B, topping analyst expectations of $0.32/share on sales of $2.53B. Shares fell 3.8% to $20.43 after the release, mostly due to disappointing Q4 guidance. Applied forecast Q4 EPS of $0.26-$0.29, on revenues of $2.26B-$2.39B. Analysts were expecting $0.30/share on sales of $2.46B. For Q3, Applied said new orders fell 14% both y/y and sequentially, to $2.28B. Gross margin declined 6% to 47.5%, but improved 2.6% over Q2. CEO Michael Splinter said "... equipment spending will be slightly lower in the second half of the calendar year, primarily due to foundry spending not materializing [despite utilization moving into the 90% range, as existing lines are being stretched and the 65-nm ramp is taking longer to develop than anticipated]. While foundry remains weak, we expect memory capital investment to remain relatively strong and logic to be flat" (full earnings call transcript). Shares of Applied lost 2.3% to $21.24 during normal trading Tuesday.
Sources: Press release, Bloomberg, MarketWatch
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