Applied Materials Inc.'s AMAT fiscal first-quarter profit fell 71% as the semiconductor-equipment company continued to face weak industrial demand, though orders improved from the previous quarter.
Applied Materials, which provides machines used to manufacture chips, solar panels and displays, has been hurt recently by lagging solar and display markets. The company has a history of boom-and-bust cycles triggered by fluctuations in demand for chips, and had expected orders to pick up in the first quarter, compared with the previous quarter. The company said Wednesday that orders grew 44% quarter-over-quarter, driven by demand for semiconductor and display equipment.
For the quarter ended Jan. 27, Applied Materials posted a profit of $34 million, or three cents a share, down from $117 million, or nine cents a share, a year earlier. Excluding acquisition-related charges and other items, per-share earnings fell to six cents from 18 cents.
Revenue decreased 28% to $1.57 billion.
The company in November forecast per-share earnings of break-even to six cents, on revenue of $1.4 billion to $1.65 billion.
Gross margin widened to 37% from 35.9%.
For the current quarter, the company projected per-share earnings of nine cents to 15 cents a share on revenue growth of 15% to 25% from the first quarter, indicating a range between $1.81 billion and $1.97 billion. Analysts polled by Thomson Reuters recently projected per-share earnings of 11 cents on revenue of $1.8 billion.
Shares rose 1.7% to $14 after hours. Through the close, the stock was up 17% in the past six months.
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