AMAT First Take: the print was solid, with revenue

AMAT First Take: the print was solid, with revenue and GPM in line with Street expectations.

Growth was driven by AI infra buildout, which lifted demand for advanced logic, DRAM and advanced packaging tools.

The company guided next-quarter revenue of $9.75-10.75bn, with the midpoint up 12.5% QoQ and above the Street ($9.6bn).

EPS was guided to $3.82-4.22, also ahead of estimates ($3.7).

However, shares sold off sharply after-hours, largely on management commentary.

AMAT had previously indicated its semi equipment biz could grow 30%+ in CY2026, but it did not explicitly raise that outlook this time.

Against core customers’ capex plans (full-year up 40%+), AMAT’s guide looks conservative.

With several majors recently lifting capex again, the market was looking for a bigger raise.

Also, because AMAT’s fiscal year is offset from the calendar year by two months, even assuming 40% growth for CY2026 implies a sharp decel in sequential growth.

That points to a step-down from ~18% this quarter to ~12% next quarter and ~6% the quarter after, which is hard for the market to digest.

Overall, since the company has already provided a full-year outlook, this print and next-quarter guide matter less, and the market is more focused on the growth trajectory ahead.

With multiple wafer fabs hiking capex again, investors wanted a clear raise to the full-year view, yet the semi equipment biz still does not suggest 40%+ full-year growth, lagging core fabs’ capex growth.

AMAT sits at the upstream end of AI capex within semi equipment.

As long as AI spend and the semi cycle continue, it should benefit from downstream capacity additions and higher investment, supporting earnings and multiple expansion.

Even if the long-term trend remains intact, the lack of a clear full-year raise will weigh on near-term sentiment.

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