Applied Materials Sees 10.69% Plunge Amid Semiconductor Sector Shifts

On October 15, shares of Applied Materials (AMAT) dropped 10.69%, even as during the trading session, the price hit its highest point since July 2024. This decline comes amidst a dynamic landscape in the semiconductor manufacturing equipment sector.

In 2023, Applied Materials fell to second place in market share within the semiconductor manufacturing equipment industry. The leader, ASML, saw explosive growth due to its exclusive high-performance photolithography machines, crucial for advanced semiconductor production. ASML’s machines are in high demand from key players like TSMC and Samsung.

Despite a modest 2% growth, resulting in $204 billion in shipments for Applied Materials, the downturn in the memory market has partly hindered its sales momentum. The overall sluggishness has been attributed to reduced investments from major firms like SK Hynix, which impacted demand for certain types of semiconductor manufacturing equipment.

The broader market anticipates a rebound, with forecasts by SEMI suggesting a 3% growth in 2024, leading to a market size of $983 billion. This outlook is supported by growing interest in AI technologies, which IDC predicts will drive a significant uptick in semiconductor market demand from 2024 onwards.