SAN FRANCISCO Applied Materials Inc's (AMAT.O) fiscal second-quarter revenue beat low expectations as demand for chips used in mobile devices fueled spending on its manufacturing equipment, but its revenue forecast fell a little short of analysts' estimates.
Driven by the need for more chips for mobile devices, spending by foundries like TSMC (2330.TW) on chip gear has recovered from a slump last year as they implement new technology to keep up with Intel Corp (INTC.O).
But Applied Materials' solar cell and display manufacturing businesses have been damaged by oversupply and weak pricing. Subsidy cuts in Europe have triggered a global glut of solar panels and driven down prices sharply.
Applied Materials' stock has fallen 16 percent since the end of March when it forecast fiscal 2012 results below expectations. It now trades at the equivalent of 11 times expected earnings.
Applied Materials said revenue in the second quarter ending in April was $2.54 billion, down from $2.86 billion in the year-ago period.
It said it expects current-quarter net sales to be flat to down 10 percent sequentially. The midpoint of that range is equivalent to $2.413 billion.
Analysts had expected revenue of $2.399 billion for the quarter ending in April and $2.443 billion for the quarter ending in July, according to Thomson Reuters I/B/E/S.
Net earnings fell to $289 million, or 22 cents a share, from $489 million, or 37 cents a share, in the year-ago period.
Shares of Applied Materials rose 1.43 percent in extended trading after closing down 1.69 percent at $10.48 on Nasdaq.