Applied Materials Orders Hit Record High, as Profit Surges
August 18 2016 - 6:30PM
Dow Jones News
Applied Materials Inc. on Thursday said orders reached another
record high in its third quarter, following a 15-year high the
previous three months, as profit surged, stirring hope for robust
results in coming quarters.
The price of shares in the company has risen 67% over the past
12 months, and it climbed 5.5% after hours to $29.20, also boosted
by strong guidance for the current quarter.
For the October quarter, the company said it expects adjusted
earnings per share of between 61 cents and 69 cents, while analysts
surveyed by Thomson Reuters expect a more-modest 48 cents. The
maker of semiconductor manufacturing tools said record-high orders
bode well for results in coming months.
The buoyant order momentum continued into the third quarter from
the previous three months. Analysts had expected orders in the
period to be around $2.71 billion, which was well below the $3.66
billion actually posted by the company, a 26.5% jump from a year
ago.
In the second quarter, orders exceeded the average of analysts'
expectations on FactSet by 41% at $3.45 billion, a 37% jump from a
year earlier. Company officials had attributed that order surge in
part to shifting manufacturing methods for certain chips used in
mobile devices that call for stacking layers of circuitry rather
than shrinking transistors.
The Santa Clara, Calif., company sells equipment to make chips
used in a wide range of products, including mobile phones. Its
machines are also used to make displays for TVs and other
products.
Profit for the latest quarter was stronger-than-expected, though
revenue disappointed the market. Applied said profit rose to $505
million from $329 million a year earlier. On a per-share basis,
earnings rose to 46 cents from 27 cents a year earlier, in part
reflecting a lower share count. Revenue rose 13.3% to $2.82
billion.
Excluding certain items, per-share profit rose to 50 cents from
33 cents a year ago.
The company had forecast adjusted earnings for the third quarter
of between 46 cents and 50 cents, with revenue at about $2.84
billion. Analysts had projected adjusted earnings of 48 cents on
revenue of $2.84 billion.
In June, Applied set a fresh $2 billion share-buyback program,
following the completion of its $3 billion program initiated last
year. It didn't provide a time frame for when it plans to
repurchase its shares.
Write to Ezequiel Minaya at ezequiel.minaya@wsj.com
(END) Dow Jones Newswires
August 18, 2016 18:15 ET (22:15 GMT)
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