July 8, 2013 / 9:07 PM / 4 years ago

Applied Materials maintains outlook on chip-making gear

SAN FRANCISCO, July 8 (Reuters) - Applied Materials Inc said it expects industry spending on wafer fabrication equipment to be flat to down 10 percent this year from 2012, in line with past predictions as growth in smartphones remains tempered by caution about the world economy.

Applied Materials CEO Mike Splinter told analysts at the chip manufacturing gear supplier’s annual investor day that he expects spending to improve next year, driven by demand for more and better smartphones and by the increased complexity of new manufacturing processes being adopted by chipmakers.

“When we talk about markets, it’s really all about mobile, it’s where the growth is,” Splinter said on Monday. “There is a war going on between these device makers.”

Applied Materials’ wafer fabrication equipment spending forecast for 2013 is equivalent to between $27 billion and $30 billion.

Shares of Applied Materials have risen about 30 percent in 2013 as investors bet that an improving economy, new manufacturing technologies and ongoing growth in smartphones will fuel more demand for chip-making equipment.

Prices of DRAM and NAND memory chips have also been recovering from slumps last year. Toshiba Corp recently said its NAND plants are running at full capacity following reduced production last year and that it plans to expand a plant in Yokkaichi, Japan.

Shares of Applied Materials were flat in extended trade on Monday after closing down 0.5 percent at $15.14.

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