Applied Materials Stock Retreats After Q2 Results Amid China Export Curb Concerns: Retail Reposes Faith In Chip-Equipment Maker

Semiconductor equipment maker Applied Materials, Inc.’s (AMAT) shares pulled back in Thursday’s extended session despite announcing fairly robust quarterly results and issuing in-line guidance.

The Santa Clara, California-based company reported a record adjusted earnings per share (EPS) of $2.39, and revenue of $7.1 billion for the second quarter of the fiscal year 2025.

That marked an increase from the year-ago quarter’s EPS of $2.09 and revenue of $6.65 billion, respectively, 

The Finchat-compiled consensus called for adjusted EPS and revenue of $2.31 and $7.12 billion, respectively.

Gary Dickerson, President and CEO, said, “Applied Materials’ broad capabilities and connected product portfolio are driving strong results in 2025 amidst a highly dynamic macro environment.”

The executive highlighted high-performance, energy-efficient artificial intelligence (AI) computing as the primary driver of semiconductor innovation, adding that “We are very well positioned at major technology inflections in fast-growing areas of the market, which supports our multi-year growth trajectory.”

CFO Brice Hill said the company has not seen significant changes in customer demand due to tariffs and macroeconomic uncertainty. 

Looking ahead, Applied Materials guided second-quarter adjusted EPS to $2.35 +/- $0.20, and revenue to $7.20 billion, +/- $500 million. This compares to the consensus estimates of $2.31 and $7.20 billion, respectively.

The company also expects an adjusted gross margin of 48.3%, down from 49.2% in the first quarter.

On the earnings call, Dickerson said China spending was lower, with investments in both DRAM and mature logic down for the year. China is a key market for Applied Materials, and the U.S. export curbs to the country have been weighing on the chip-equipment maker.

On Stocktwits, retail sentiment toward the Applied Materials stock was ‘extremely bullish’ (95/100) by late Thursday, with the retail chatter at ‘extremely high’ levels.

A bullish watcher urged fellow retailers to buy the stock before President Donald Trump finalizes the China deal.

Another user said the stock would hit $200 by the end of the year.

After ending Thursday’s session up 0.35% at $174.75, the Applied Materials stock shed 5.58% to $165 in after-hours trading.

The stock has gained about 8% this year.

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