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Applied Materials Forecasts Disappointing Sales Amid US-China Trade Tensions
14 Aug
Summary
- Applied Materials sees less demand from customers in China
- Delays in exporting technology to China due to regulatory issues
- Large customers postponing purchases due to tariff negotiations
In a recent development, Applied Materials Inc., the largest American producer of chipmaking equipment, has reported a disappointing sales and profit forecast for the fiscal fourth quarter of 2025. The company's CEO, Gary Dickerson, stated that they are seeing less demand from customers in China, as well as delays in obtaining approval for exporting technology to that country.
Moreover, Dickerson revealed that large customers are putting off some purchases due to the prolonged negotiations around tariffs and other economic issues between the United States and China. This "level of uncertainty," as Dickerson described it, has weighed heavily on the company's outlook.
As a result, Applied Materials' revenue is expected to be approximately $6.7 billion in the fourth quarter, significantly lower than the $7.32 billion analysts had estimated on average. Profit is also projected to be around $2.11 per share, compared to a previous estimate of $2.38 per share.
Despite the disappointing forecast, the company remains optimistic about the long-term demand for computing power. Dickerson noted that customers in China had significantly increased their purchases in recent years, and are now just "digesting those purchases." The new administration in the US is also "very focused on increasing semiconductor supply in the United States," which Dickerson sees as a positive sign for the company.
