Applied Materials Inc forecast first-quarter sales and profit below market estimates on Thursday, as the pandemic disrupts supply chains and keeps the company from meeting client orders, sending its shares down nearly 6% in extended trading.
Lockdowns in parts of Asia have made sourcing of raw materials and production difficult, offsetting red-hot chip demand driven by rising 5G adoption and higher sales of phones, laptops and gaming consoles as consumers spend more time online.
The company, which makes machines used to manufacture chips and other high-tech components, expects current-quarter net sales of $6.16 billion, plus or minus $250 million, compared with analysts’ estimates of $6.50 billion, according to Refinitiv IBES data.
Applied Materials, which counts top chipmakers such as Intel Corp and Taiwan Semiconductor Manufacturing Co Ltd as its customers, also forecast adjusted earnings between $1.78 and $1.92 per share, compared with estimates of $2.01 per share.
For the fourth quarter, the company’s sales rose 31% to $6.12 billion, below estimates of $6.35 billion.
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