Applied Materials delivers Q4 beat, but DOJ probe into shipments to China weight

Investing.com — Applied Materials reported fiscal fourth results Thursday that beat analyst estimates, though the stock was weighed down in afterhours trading on news the semiconductor equipment maker is under a U.S. probe for potentially skirting U.S. export restrictions to China. 

Applied Materials Inc fell more than 6% in afterhours.

Applied Materials Q4 reported adjusted diluted EPS of $2.12, up from $2.03 from the prior year, while revenue fell to $6.72 billion from $6.75B. That was ahead of expectations for EPS of $1.99 on revenue of $6.52B.

Adjusted gross margin rose to 47.3% in Q4 from 46% a year earlier.  

Looking ahead, the company forecast fiscal Q1 sales of approximately $6.47B, plus or minus $400M, and adjusted diluted EPS in the range of $1.72 to $2.08. That beat analyst estimates for EPS of $1.84 on revenue of $6.83B.

Just ahead of the earnings report, however, Reuters reported, citing unnamed sources, that the company is under an investigation by the Justice Department for sending semiconductor equipment to China’s chipmaker SMIC via South Korea that potentially fall foul of U.S. restrictions on the sale of chips and chip-making equipment to China.

 “The company is cooperating with the government and remains committed to compliance and global laws, including export controls and trade regulations,” Applied Materials said in a statement, according to Reuters.

Risk Disclaimer:

Please note that this article does not offer any instructions or suggestions regarding investment decisions. Therefore, it is essential that you carefully evaluate your financial situation and conduct thorough analysis, or seek advice from a qualified professional, before making any investment decisions.