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Applied Materials forecasts second-quarter revenue, profit above estimates

(Reuters) - Chip gear maker Applied Materials Inc forecast second-quarter revenue and profit above Wall Street estimates on Wednesday, as a global roll out of 5G mobile technology led to higher demand for semiconductor equipment.

FILE PHOTO - Applied Materials’ new corporate signage photo in Santa Clara, California, U.S. is shown in this image released on August 22, 2016. Courtesy Applied Materials/Handout via REUTERS

Revenue from the company’s semiconductor systems segment, which supplies gears to chip makers, rose 24% to $2.81 billion, beating analysts’ estimates of $2.77 billion, according to IBES data from Refinitiv.

While sales from its business that makes flat panel displays for televisions, PCs and smartphones, fell 34.5% to $332 million in the quarter.

Revenue from China rose 31.4% to $1.27 billion in the first quarter, contributing 30.5% to the company’s overall revenue.

For the second-quarter, the company expects revenue of $4.34 billion, plus or minus $200 million, above analysts’ expectations of $4.05 billion, according to IBES data from Refinitiv.

The company expects adjusted profit to be in the range of 98 cents per share to $1.10 per share, higher than analysts’ estimates of 92 cents.

Revenue for the first quarter ended Dec. 31, rose about 11% to $4.16 billion, beating analysts’ average estimate of $4.11 billion.

The company’s net income rose to $892 million, or 96 cents per share, from $771 million, or 80 cents per share, a year earlier.

Excluding items, the company earned 98 cents, beating analysts’ average estimate of 93 cents.

Shares of the company, which rose nearly 86% in 2019, were up 1.1% in extended trading.

Reporting by Amal S in Bengaluru; Editing by Vinay Dwivedi

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