Feb 12 (Reuters) – Applied Materials forecast second-quarter revenue and profit above market estimates on Thursday, betting on a boom in demand for AI processors and a worldwide memory shortage to help drive sales of its chipmaking equipment.
The company’s shares rose over 9% in extended trading. Shares of peers Lam Research and KLA both rose more than 2% in extended trading, as Applied’s upbeat outlook lifted sentiment.
Applied Materials expects second-quarter sales of about $7.65 billion, plus or minus $500 million, compared with estimates of $7.01 billion, according to data compiled by LSEG.
The largest U.S. semiconductor equipment maker forecast second-quarter adjusted profit of about $2.64 per share, plus or minus 20 cents, compared with estimates of $2.28.
The results were “fueled by the acceleration of industry investments in AI computing,” CEO Gary Dickerson said in a statement.
“The need for higher performance and more energy-efficient chips is driving high growth rates for leading-edge logic, high-bandwidth memory and advanced packaging.”
High-bandwidth memory (HBM) refers to a type of advanced memory chip used alongside pricey AI processors such as those sold by Nvidia.
The rapid build-out of AI infrastructure has absorbed much of the world’s memory chip supply, which has lifted prices as manufacturers prioritize components for already short-supplied HBM.
Applied Materials reported first-quarter revenue of $7.01 billion, beating estimates of $6.87 billion.
Within its chip segment, revenue from tools for dynamic random access memory (DRAM) chips rose 34%, compared with 27% in the first quarter last year.
The company reported first-quarter profit of $2.38 per share, excluding items. Analysts had expected an adjusted profit of $2.20 per share.
(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Alan Barona and Sriraj Kalluvila)
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