By Maria Armental
Semiconductor-equipment supplier Applied Materials Inc. (AMAT) reported sharply lower profit and revenue in the latest period and forecast another difficult period this quarter.
Third-quarter profit fell 44% to $571 million, or 61 cents a share. On an adjusted basis, profit fell to 74 cents a share from $1.04 a share a year earlier.
Net sales fell 14% to $3.56 billion.
The company had projected 67 cents to 75 cents a share in adjusted profit and about $3.53 billion in revenue, while analysts surveyed by FactSet projected 70 cents a share and $3.53 billion in revenue.
This quarter, Applied Materials projects adjusted profit of 72 cents to 80 cents a share and about $3.69 billion in revenue, compared with analysts' projected 76 cents a share in adjusted profit and $3.66 billion in revenue.
Company officials have framed the challenges as short-term growth pains as the sector moves away from the smartphones that drove the majority of semiconductor capital investments in recent years toward the artificial intelligence and big data that are expected to fuel the sector's growth.
A memory cycle also has weighed on Applied Materials' performance in recent quarters, but company officials said in May when they reported second-quarter results that NAND pricing was stabilizing and inventory levels were down from their peak, though prices were still above normal levels.
DRAM, Chief Executive Gary Dickerson said at the time, wasn't as far along in the correction cycle.
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