Here’s what to expect

Semiconductor machinery maker Applied Materials (NASDAQ:AMAT) will announce earnings results tomorrow after the market closes. Here’s what to look for.

Applied Materials beat analysts’ revenue expectations by 1.7% last quarter, reporting year-over-year revenue of $6.65 billion. It was a decent quarter for the company, with a solid beat on analysts’ EPS estimates and in-line revenue guidance for next quarter.

Is Applied Materials an Earnings Buy or Sell? Read our full review here, it’s free.

This quarter, analysts expect Applied Materials’ revenue to rise 3.8% year-over-year to $6.67 billion, a reversal from the 1.5% decline seen in the same quarter last year. Adjusted earnings are expected to come in at $2.02 per share.

Most analysts who cover the company have reconfirmed their estimates in the past 30 days, suggesting that they expect the business to maintain its earnings trajectory. Applied Materials has a history of beating Wall Street expectations, beating revenue estimates each time over the past two years by an average of 3.4%.

Looking at Applied Materials’ peers in the semiconductor manufacturing segment, some have already reported their Q2 results, giving us an indication of what to expect. FormFactor posted year-over-year revenue growth of 26.7%, beating analysts’ expectations by 1.3%, and Lam Research reported revenue up 20.7%, beating estimates by 1%. FormFactor fell 11.8% following the results, while Lam Research also fell 10%.

Read our full analysis of the FormFactor results here and the Lam Research results here.

Growth stocks have been quite volatile since the start of 2024, and semiconductor manufacturing stocks have been swept along with them, with share prices down an average of 17.2% over the past month. Applied Materials is down 18.1% over the same period and is headed for earnings with an average analyst price target of $243.7 (compared to the stock’s current price of $201.3).

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