Earnings Mastery
  • Politics
  • Business
  • Investing
  • World
No Result
View All Result
  • Politics
  • Business
  • Investing
  • World
No Result
View All Result
Earnings Mastery
No Result
View All Result
Home Investing

Applied Materials decline after $710M revenue hit from US export restrictions

October 4, 2025
in Investing
Applied Materials decline after $710M revenue hit from US export restrictions
0
SHARES
0
VIEWS
Share on FacebookShare on Twitter

Applied Materials, one of the world’s largest suppliers of semiconductor manufacturing equipment, is bracing for a significant financial setback as new US export restrictions tighten the flow of chipmaking tools to China.

The company disclosed in a filing Thursday that the rules could reduce its revenue by $710 million over the next two years, adding to mounting challenges in a critical market.

Applied Materials shares fell 2.32% to $218.40 on Friday afternoon session.

Revenue impact

The Bureau of Industry and Security’s updated restrictions mean Applied Materials will need a license to export certain products to China-based customers.

The company estimates the measures will cut $110 million from its fourth-quarter revenue and shave $600 million from its 2026 results.

China accounts for roughly 30% of Applied Materials’ sales so far this year, making the restrictions a meaningful headwind.

Stifel analyst Brian Chin noted that the company had already signaled a sharp decline in Chinese sales and now faces an additional drag.

He projected a 10% quarter-on-quarter sales decline for the fourth quarter.

Investors responded cautiously on Friday.

Applied Materials stock fell over 2%, while its industry peers Lam Research and KLA also edged lower, falling 0.28% and 2.46% respectively.

Despite the pullback, shares of all three companies have posted strong gains in 2024, reflecting broader industry momentum.

Sector strength offsets short-term pressure

The new restrictions are unlikely to erase the impressive gains semiconductor equipment suppliers have delivered this year.

Applied Materials stock is up 37% year-to-date as of Thursday’s close, while Lam Research has surged 104% and KLA has advanced 81%.

Those gains have been supported by rising demand for wafer fabrication equipment (WFE), a crucial segment for the global semiconductor supply chain.

However, US policy efforts to curb China’s domestic chipmaking ambitions add a layer of uncertainty.

The Trump administration is targeting Chinese semiconductor independence, which could pressure US suppliers in the near term.

At the same time, the restrictions may accelerate Beijing’s efforts to achieve self-sufficiency, creating longer-term risks for the industry.

China represents between 20% and 25% of the global WFE market, according to Rothschild & Co Redburn analyst Timm Schulze-Melander.

Domestic Chinese equipment makers already command 11% to 13% of global market share in certain segments, signaling rising competition for US firms.

Rising competitive pressures

Among US suppliers, Applied Materials is seen as particularly vulnerable to Chinese competition.

Schulze-Melander highlighted the company’s reliance on its Physical Vapor Deposition (PVD) equipment business, which accounts for nearly one-third of its operating profits.

That segment is at risk of losing share to local rivals as China expands its domestic capabilities.

“Our analysis concludes that while almost all semicap equipment suppliers face some degree of challenge from China-based rivals, Applied Materials’ earnings base is the most threatened by China competition,” Schulze-Melander wrote in a recent note.

The analyst has a Neutral rating and a $190 target price on Applied Materials, suggesting limited upside from current levels.

While the company retains a strong market position and benefits from global chip demand, the combination of export restrictions and intensifying competition in China presents a material challenge to its longer-term growth trajectory.

The post Applied Materials decline after $710M revenue hit from US export restrictions appeared first on Invezz

Previous Post

US digest: Trump’s Hamas ultimatum, government shutdown stalemate continues

Next Post

Europe bulletin: Manchester synagogue attack aftermath, stocks close higher

Next Post
Europe bulletin: Manchester synagogue attack aftermath, stocks close higher

Europe bulletin: Manchester synagogue attack aftermath, stocks close higher

    Become a VIP member by signing up for our newsletter. Enjoy exclusive content, early access to sales, and special offers just for you! As a VIP, you'll receive personalized updates, loyalty rewards, and invitations to private events. Elevate your experience and join our exclusive community today!


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest

    Tata Capital eyes $15.7 billion valuation in India’s biggest IPO of 2025

    October 6, 2025
    India may settle $22.5bn Vodafone dispute to cement UK ties

    India may settle $22.5bn Vodafone dispute to cement UK ties

    October 6, 2025
    Here’s why the Rolls-Royce share price is up 105% in 2025

    Here’s why the Rolls-Royce share price is up 105% in 2025

    October 6, 2025
    Ardian buys Ireland’s Energia Group in €2.5bn deal as AI boosts demand: report

    Ardian buys Ireland’s Energia Group in €2.5bn deal as AI boosts demand: report

    October 6, 2025
    Europe markets open: Stoxx 600 slips 0.1% as a political earthquake in Japan roils Asia

    Europe markets open: Stoxx 600 slips 0.1% as a political earthquake in Japan roils Asia

    October 6, 2025
    China Financial Leasing’s $11M plan signals Hong Kong’s AI-crypto ambition

    China Financial Leasing’s $11M plan signals Hong Kong’s AI-crypto ambition

    October 6, 2025

    Disclaimer: EarningsMastery.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Popular

    Toyota reports eighth consecutive month of global sales growth

    September 29, 2025

    Latest

    Tata Capital eyes $15.7 billion valuation in India’s biggest IPO of 2025

    October 6, 2025
    India may settle $22.5bn Vodafone dispute to cement UK ties

    India may settle $22.5bn Vodafone dispute to cement UK ties

    October 6, 2025
    Here’s why the Rolls-Royce share price is up 105% in 2025

    Here’s why the Rolls-Royce share price is up 105% in 2025

    October 6, 2025
    • About us
    • Privacy Policy
    • Terms & Conditions

    Copyright © 2025 earningsmastery.com | All Rights Reserved

    No Result
    View All Result
    • Politics
    • Business
    • Investing
    • World

    Copyright © 2025 earningsmastery.com | All Rights Reserved