Applied Materials Surges After Strong Q3 Results

Applied Materials AMAT released its fiscal third-quarter results after the closing bell on Thursday. The company reported record results and in late trading, the stock was last up almost 6 percent to $29.23. For the third-quarter, Applied Materials recorded net income of $550 million or $0.50 per share, compared to $410 million or $0.33 per share, in the year ago period. This topped analysts' consensus EPS estimates of $0.48. Sales in the quarter were up 13 percent to $2.82 billion, which came in just below Wall Street consensus revenue estimates of $2.84 billion. Gross margin in the quarter was 42.3 percent and operating margin was 21.1 percent. Applied Materials also reported new orders up 26 percent year over year to $3.66 billion and a backlog of $4.95 billion, an increase of 60 percent versus last year. Looking ahead, AMAT sees Q4 net sales to be up 15 to 19 percent sequentially and non-GAAP EPS of $0.61 to $0.69. This is well above the current consensus earnings per share estimate of $0.48. "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. "We are in the early stages of large, multi-year industry inflections that are driving our business today and creating new opportunities for future growth."