Applied Materials Inc. shares declined in the extended session Thursday, after the semiconductor-manufacturing equipment maker missed earnings, revenue and its forecast, and pointed at continuing supply-chain issues.
For the second quarter, Applied Materials AMAT reported net income of $1.54 billion, or $1.75 a share. Adjusted earnings, which excluded share-based compensation and other items, were $1.85 a share, compared to $1.63 a share in the year-ago period. Revenue rose to $6.25 billion from $5.58 billion in the year-ago quarter.
Analysts surveyed by FactSet had predicted adjusted earnings of $1.90 a share on revenue of $6.35 billion. After a 0.5% decline in the regular session, the shares fell to close at $110.74, a decline of about 5% in after-hours trading. The stock has fallen about 10% in the past 12 months, in line with the performance of the S&P 500 index SPX. Demand for the equipment Applied Materials makes is high because silicon-wafer manufacturers, known as fabrication plants or fabs, have had more orders than capacity during the COVID-19 epidemic, as semiconductors needed to make electronics, cars and other products have been in short supply for about two years running. Applied Materials needs chips and other components to make its equipment, and has struggled with the same supply-chain issues. Demand for Applied Materials products and services has never been stronger, but we remain constrained by ongoing supply-chain issues, Chief Executive Gary Dickerson said in a statement. For the third quarter, Applied Materials forecast adjusted earnings of $1.59 to $1.95 a share on sales of $5.85 billion to $6.65 billion. The analysts on average had been expecting adjusted earnings of $2.04 a share on revenue of $6.68 billion, according to FactSet. Other fab-equipment suppliers have noted in unison that their sales are held back by supply constraints due to high demand, as was seen in earnings reports from ASML Holding NV ASML, Lam Research Corp. LRCX and KLA Corp. KLAC back in April.