Applied Materials Profit Tops Street, Outlook Strong; Shares Up 5%

(RTTNews) - Applied Materials Inc. (AMAT) Thursday reported a jump in profit for the third quarter, as revenues grew 13 percent reflecting growth across all segments. The semiconductor equipment maker's earnings for the quarter trumped Wall Street estimates, but revenues fell short of expectations. The company detailed a strong outlook for the fourth quarter, sending its shares up a near 5 percent in the extended trading hours.

Santa Clara, California-based Applied Materials' third-quarter profit rose to $505 million or $0.46 per share from $329 million or $0.27 per share last year.

Adjusted earnings for the quarter increased to $550 million or $0.50 per share from $410 million or $0.33 per share last year. On average, 20 analysts polled by Thomson Reuters expected earnings of $0.48 per share for the quarter. Analysts' estimates typically exclude special items.

Applied Materials' third-quarter sales jumped 13 percent to $2.82 billion from $2.49 billion last year. Analysts had a consensus revenue estimate of $2.84 billion for the quarter.

"With earnings and orders at an all-time high, Applied is performing better than ever and in a great position to sustainably outperform our markets," said Gary Dickerson, president and CEO.

Applied Materials' products are used by chip companies to make smartphone and memory chips, and investors consider its orders and sales as an important metric to gauge the demand pattern of the electronics market.

Sales increased across Applied Materials' all units, including semiconductor systems, applied global services, display and adjacent markets.

Looking forward to the fourth quarter, Applied Materials expects adjusted earnings of $0.61 to $0.69 per share and sales growth of 15 percent to 19 percent sequentially. Analysts currently estimate earnings of $0.48 per share.

AMAT closed Thursday's trading at $27.68, up $0.39 or 1.43%, on the Nasdaq. The stock further rose $1.28 or 4.62% in the after-hours trade.