Semiconductor know-how firm Utilized Supplies, Inc. (NASDAQ: AMAT) has reported better-than-expected fourth-quarter gross sales that remained unchanged year-over-year. The corporate additionally issued constructive steerage for the primary quarter however the inventory declined, reflecting traders’ issues over a current investigation into potential evasion of restrictions on exports to China.
Inventory
The inventory suffered a loss quickly after the announcement final week and slipped beneath the $ 150 mark. However it’s nonetheless buying and selling above the long-term common, after gaining a powerful 42% since final 12 months. Specialists are of the view that AMAT has what it takes to return to the expansion path and cross the document highs of January 2022. The current dip has created a chance to personal the inventory.
The Santa Clara-based tech agency, the most important semiconductor tools maker within the US, is well-positioned to make the most of its broad product portfolio and excessive demand from prospects, given the robust progress the business is witnessing. Nevertheless, the corporate just isn’t resistant to the near-term challenges the broad sector is going through, just like the squeeze on enterprise spending amid macro uncertainties and the post-pandemic slowdown in PC gross sales.
In the meantime, as 2024 progresses, a possible restoration within the PC market and continued growth of the cloud/AI markets might ease the affect of financial and geopolitical uncertainties, driving gross sales progress for Utilized Supplies.
Flat Income
Adjusted revenue rose to $2.12 per share within the October quarter from $2.03 per share final 12 months. Web revenue, together with particular gadgets, was $2.0 billion or $2.38 per share within the fourth quarter, in comparison with $1.59 billion or $1.85 per share within the corresponding interval of 2022. In the meantime, internet gross sales remained broadly unchanged at $6.72 billion through the three-month interval. The outcomes topped expectations, as they’ve completed in every of the trailing six quarters. The primary Semiconductor Programs enterprise contracted by 3%, offsetting progress within the different divisions of Utilized World Providers and Show and Adjoining Markets.
Commenting on the This fall outcomes, CEO Gary Dickerson mentioned, “Whereas semiconductor and wafer fabrication tools spending have been each down in 2023, Utilized was in a position to exhibit the power of our broad portfolio, in addition to the central function we play in enabling main business inflections. Our semiconductor methods enterprise delivered mid-single-digit progress for the fiscal 12 months and stays on observe for progress in calendar 2023, which would be the fifth consecutive 12 months that we’ve outperformed the wafer fab tools market.”
Steering
The corporate distributed $968 million to shareholders and ended the quarter with an working money movement of $1.56 billion. For the primary three months of fiscal 2024, it expects internet gross sales to be round $6.47 billion, plus or minus $400 million. First-quarter earnings per share, excluding particular gadgets, are anticipated to be within the vary of $1.72 to $2.08. The steerage is broadly consistent with the market’s projection however signifies a decline from the prior-year numbers.
In response to media studies, the Justice Division is investigating expenses that the corporate probably evaded export restrictions on Chinese language chipmaker SMIC. It’s alleged that Utilized Supplies exported superior semiconductors and chipmaking gear to SMIC with out export licenses.
AMAT traded barely greater within the early hours of Monday, recovering from the downturn that adopted the earnings announcement. It has gained 14% previously 30 days.
