What's In Store For Applied Materials In Q2 Earnings?

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Applied Materials, Inc. (AMAT - Free Report) is set to report second-quarter fiscal 2021 results on May 20.

For the fiscal second quarter, the company expects net sales of $5.39 billion(+/-$200 million). Furthermore, the Zacks Consensus Estimate for revenues is pegged at $5.39 billion, suggesting growth of 36.3% from the year-ago reported figure.

Further, the company projects non-GAAP earnings of $1.44-$1.56 per share for the quarter under review. The Zacks Consensus Estimate for earnings is pegged at $1.50, indicating growth of 68.5% from the year-ago reported figure.

The company surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed the same once, the earnings surprise being 6.42%, on average.

Applied Materials, Inc. Price and EPS Surprise

Applied Materials, Inc. Price and EPS Surprise

Applied Materials, Inc. price-eps-surprise | Applied Materials, Inc. Quote

Factors to Consider

Applied Materials’ portfolio strength, expanding position in memory, and increasing new design wins are expected to have driven the fiscal second-quarter performance.

Further, more clients are expected to have upgraded their equipment, owing to the increasing deployment of 5G in key markets. This, in turn, is expected to have aided the company’s top line in the quarter to be reported.

Furthermore, growth opportunities across specialty nodes and new node ramps across foundry, logic, NAND, and DRAM are expected to have benefited the company in the to-be-reported quarter. Moreover, inventory reductions across memory and demand elasticity in NAND are anticipated to have acted as tailwinds.

Also, the company is expected to have witnessed solid customer momentum across automotive and advanced packaging, owing to rising foundry logic spending.

All of the factors are expected to have driven sales in the Semiconductor Systems Group segment in the to-be-reported quarter. For second-quarter fiscal 2021, the Zacks Consensus Estimate for sales for this segment is pegged at $3.9 billion, suggesting growth of 50.1% from the prior-year quarter’s reported figure.

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