North Coast Solar Stocks

August 11, 2009

Applied Materials swings to a fiscal third quarter loss

Filed under: AMAT — Tags: , , , , — Jason @ 6:13 pm

But chip tools maker’s results exceeds expectations, shares rise

By Benjamin Pimentel, MarketWatch

SAN FRANCISCO (MarketWatch) – Applied Materials Inc. (AMAT) said on Tuesday it swung to a quarterly loss, as sales of semiconductor-manufacturing equipment fell sharply amid an ongoing slump in the chip and broader technology markets.

But shares of Applied Materials gained more than 3% after hours after the Santa Clara, Calif.-based chip-tools maker’s results also exceeded expectations, aided in part by its strengthening solar power business and an improving market.

Applied also issued a better-than-expected sales and earnings outlook for the current quarter, as Chief Executive Mike Splinter offered a more upbeat view of the state of the market.

“Today, there are more indications that demand is growing and for the first time in a long while, we see positive trends in our business,” Splinter said in a conference call with analysts. “Economic decline in the U.S. , Europe and Japan appears to be moderating.”

Applied Materials reported a fiscal third-quarter loss of $55 million, or 4 cents a share, compared with a profit of $165 million, or 12 cents a share, for the year-earlier period. Revenue was $1.13 billion, down from $1.85 billion for the same quarter last year.

Not counting one-time charges, the company broke even in the quarter, beating expectations.

Analysts had expected Applied Materials to report a loss of 9 cents a share, on revenue of $955.4 million, according to data from FactSet Research.

For the current quarter, the company said it expects sales to rise 10% to 20% from the previous quarter, which translates to a range of roughly $1.24 billion to $1.36 billion.

Applied Materials also said it expects earnings per share in the range of breakeven to 4 cents a share. Analysts currently expect the company to report a loss of 5 cents a share, on revenue of $1.06 billion, according to FactSet Research.

Sales of its core silicon systems group fell sharply to $498 million, from $756 million for the year-earlier period.

In a positive sign in Applied Material’s bid to expand its presence in the solar power market, its energy and environmental solutions business posted sales of $224 million, up from $174 million for the same quarter last year.

In a prepared statement, Splinter said that despite “a difficult environment,” the company “improved its operating performance and generated significant cash flow.”

Needham & Co. analyst Edwin Mok said the company posted results that were “quite strong,” adding, “The tone is turning more positive than before.”


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