Applied Materials' Capacity Targets Seen Driving Revenue, Earnings
Dow Jones
Aug 14
1135 ET - Applied Materials' move to double systems-manufacturing capacity by 2028 was the key takeaway from the company's 3Q report and earnings call, UBS analysts write in a note. While the target isn't necessarily revenue guidance, they write, "we are hard-pressed to believe that AMAT would have excess supply in C2028 when it is getting 8-10Q visibility from major customers." The target, they write, is consistent with their model for around $14 billion in quarterly systems revenue exiting 2028, which would push earnings per share close to $30 with room for further upside. Still, the investments in capacity may be a headwind to gross margins, contributing to a guide that "left a bit to be desired," they write. Shares fall 4.6%.
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