Applied Materials Plunges 6.23% on Q2 Earnings Miss

Applied Materials' stock price dropped 6.23% in pre-market trading on May 16, 2025, following the release of its Q2 financial report. The company reported a 6.84% year-over-year increase in revenue to $14.27 billion for the first six months of the fiscal year, while net income decreased by 11.20% to $3.32 billion. The earnings per share for the fiscal year stood at $4.10, down from $4.50 the previous year.

Applied Materials, a global leader in materials engineering, provides manufacturing equipment, services, and software to the semiconductor, display, and related industries. The company's diverse technological capabilities enable it to enhance the performance, yield, and cost-efficiency of its clients' equipment. Its customer base includes manufacturers of semiconductor chips, liquid crystal displays (LCDs), organic light-emitting diodes (OLEDs), and other electronic devices.

The company's Q2 financial performance showed a revenue of $7.10 billion, a slight decrease from the previous quarter's $7.17 billion. The net income for the quarter was $2.14 billion, a significant drop from the previous quarter's $1.19 billion. The basic earnings per share for the quarter was $2.64, down from $1.46 in the previous quarter.

Despite the revenue growth, the decrease in net income and earnings per share has raised concerns among investors about the company's profitability. The company's guidance for the third fiscal quarter, with an expected revenue range of $72 billion with a $5 billion fluctuation, has also been met with mixed reactions. While some analysts view this as in line with market expectations, others had anticipated higher revenue figures.