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Investors Should Take Note of Applied Materials Inc. (AMAT) Stock

Last quarter, Applied Materials Inc. (NASDAQ: AMAT), a semiconductor equipment manufacturer, missed both its own and Wall Street’s expectations. The semiconductor market’s material and supply chain concerns continue to put pressure on the company’s business.

Applied Materials raised revenue by 12% to $6.25 billion in the second quarter of fiscal 2022. Adjusted profits per share grew by 13% to $1.85. Both figures, though, fell short of Wall Street estimates. The corporation was never able to resolve supply chain issues. At the same time, the factory was able to remove certain obstacles to work in February and March, but the issues reappeared in April, causing a delay in delivery.

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AMAT says it’s addressing the issues by strengthening supplier connections and speeding up equipment deployment at client sites. Component shortages, on the other hand, are predicted to last until 2024.

As a result, Applied Materials Inc. (AMAT)’ short-term prospects remain uncertain. However, the business intends to spend more than $100 billion on plate production equipment this year, up from roughly $90 billion last year. Furthermore, AMAT anticipates significant demand for its solutions through 2023-2024.

The firm has a huge order backlog that has been expanding in recent quarters. Last quarter, management did not disclose the number of pending orders, but at the conclusion of the first fiscal quarter, Applied Materials Inc. (AMAT) had a record backlog of orders of $8 billion.

AMAT estimates revenue of $6.25 billion (plus or minus $400 million) and profits of $1.59 to $1.95 per share in the fourth quarter. In the long run, Applied Materials Inc. (AMAT) anticipates the enhanced supply chain to lower costs and increase product mix and output, which should boost margins and profits.

In the last month, AMAT stock has lost -0.36 percent, -18.66 percent in the last three months, and -27.12 percent in the last six months. AMAT’s price volatility during the last week was calculated to be 5.06 percent, and over the last month, it was 4.72 percent.

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