Applied Materials Guides Q1 Lower, Shares Fall

Applied Materials, Inc. AMAT reported results Thursday for its fourth quarter ended October 26, 2014. Revenues came in at $2.26 billion, below estimates of $2.27 billion, down 9 percent sequentially and up 8 percent year-over-year. Net sales were $2.26 billion, flat sequentially and up 14 percent year-over-year.

On a non-GAAP adjusted basis, the company reported gross margin of 44.2 percent, operating income of $442 million, and net income of $338 million or $0.27 per diluted share, inline with estimates.

The company recorded GAAP gross margin of 42.4 percent, operating income of $412 million, and net income of $290 million or $0.23 per diluted share.

"Our fourth quarter results round out a strong year for Applied Materials where we grew revenues in our semiconductor business by 25 percent and expanded our company operating margin by 6 points," said Gary Dickerson, president and CEO. "We are making our largest gains in areas of the market that are growing the fastest, including etch and deposition, and we carry positive momentum into 2015."

For the first quarter of fiscal 2015, Applied expects net sales to be in the range of flat to up 5 percent from the previous quarter. Non-GAAP adjusted diluted EPS is expected to be in the range of $0.25 to $0.29, below analyst estimates of $0.31.

Applied Materials traded at $21.90 in the extended session, down 3.2 percent.