May 14 (Reuters) – Applied Materials on Thursday forecast third-quarter revenue and adjusted profit above Wall Street estimates, betting that heavy spending on data centers and AI infrastructure will sustain strong demand for its chip-making tools.
Shares of the Santa Clara, California-based company rose more than 4% in extended trading.
The ongoing AI boom is benefiting equipment suppliers such as Applied Materials, as building more powerful AI chips requires not only more silicon wafers but also complex manufacturing processes.
Applied expects its semiconductor equipment business to grow more than 30% in 2026, CEO Gary Dickerson said in a statement.
“The rapid global build-out of AI computing infrastructure combined with Applied’s strong leadership positions in leading-edge logic, DRAM and advanced packaging provide an exceptionally strong foundation for sustained, multi-year revenue and profit growth,” Dickerson said.
The company forecast third-quarter revenue of about $8.95 billion, plus or minus $500 million, above analysts’ average estimate of $8.09 billion, according to data compiled by LSEG.
Its adjusted profit forecast of $3.36 per share, plus or minus 20 cents, also exceeded the average analyst estimate of $2.88 per share.
The company has increased its build plan, inventory positions and logistics capacity, CFO Brice Hill said, as it looks to ensure operational and supply chain readiness.
Applied’s tools are crucial for processes like atomic layer deposition and advanced etching that help create the intricate, three-dimensional structures of modern chips.
For the second quarter ended April 26, Applied reported revenue of $7.91 billion, beating analysts’ average estimate of $7.65 billion.
Applied’s quarterly adjusted profit of $2.86 per share also beat an estimate of $2.66.
(Reporting by Juby Babu in Mexico City; Editing by Shinjini Ganguli)
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