Applied Materials Beats Estimates, But No Guidance (AMAT)

Applied Materials (NASDAQ:AMAT) posted earnings and non-GAAP EPS was $0.34 on revenues of $2.37 Billion. First Call had consensus estimates for this quarter at $0.29 EPS on revenues of $2.38 Billion, while next quarter estimates are $0.27 EPS on revenues of $2.31 Billion. 

Applied’s new orders were $2.21 Billion for the quarter, down 18% from $2.69 billion for the fourth quarter of 2006, and down 3% from $2.28 Billion for the third quarter of fiscal 2007. Gross margin was 45.5%, down from 47.1% for the fourth quarter of fiscal 2006, and down from 47.5% for the third quarter of fiscal 2007. Backlog at the end of the fourth quarter of fiscal 2007 was $3.65 billion, up from $3.43 billion at the end of the third quarter of fiscal 2007.

They did address some of the changes in direction we hoped they would.  CEO Mike Splinter noted, "…..we enhanced our position in flash memory, entered the thin film solar business with strong demand for the SunFab line, and drove our operating performance to increase earnings per share…. HCT acquisition for precision solar wafering and the launch of our PVD product for flat panel display arrays…."

Shares closed up 1.2% today at $18.84 and shares are up marginally in after-hours trading.  Unfortunately, until guidance is out in the conference call, this is an incomplete report.  Next quarter’s estimates from First Call are $0.27 EPS on revenues of $2.31 Billion.  That new orders component being down 3% sequentially doesn’t send a rocking strong message, but the slight increase in backlog may negate that.

Jon C. Ogg
November 14, 2007

Jon Ogg produces the more detailed 24/7 Wall St. subscriber-based Special Situation Investing Newsletter which covers buyouts, reorganizations, spin-offs and more; he does not own securities in the companies he covers.