Applied Materials Profit Rises on Soaring AI Demand — Update

By Katherine Hamilton

Applied Materials logged higher profit in the fiscal first quarter as artificial intelligence computing demand soars.

Profit jumped 70% to $2.03 billion, or $2.54 a share, in the quarter ended in January, compared with $1.19 billion, or $1.45 a share, a year earlier.

"The race to build out AI infrastructure is driving unprecedented spending on semiconductors, semiconductor manufacturing capacity and research and development," Chief Executive Gary Dickerson told analysts on a Thursday call.

Shares climbed 14% to $373 in after-hours trading. Through the close, the stock had gained 78% in the past 12 months.

Dickerson said he expects demand and growth momentum to continue through 2027, which is the year he now thinks global semiconductor industry revenues can hit $1 trillion. AI developers' need for higher performing and more energy-efficient chips is driving growth rates for memory and packaging, he said.

"Our largest customers are giving us increased longer-term visibility to ensure we have operational capacity and service support in place for their ramps," Dickerson said.

In the current quarter, Applied Materials expects revenue of $7.15 billion to $8.15 billion, with adjusted per share earnings of $2.44 to $2.84. That forecast would beat Wall Street estimates of $7.01 billion in revenue and $2.28 a share in adjusted earnings.

Demand is likely to be weighted more towards the second half of 2026, Dickerson said.

To keep up with skyrocketing demand, Applied Materials plans to expand its semiconductor equipment business more than 20% this calendar year.

The company has also nearly doubled its system manufacturing capability and increased inventories to keep up with demand, Chief Financial Officer Brice Hill added.

Stripping out certain one-time items, adjusted per-share earnings were $2.38, ahead of the $2.21 anticipated by analysts, according to FactSet.

Revenue fell 2% to $7.01 billion. Analysts surveyed by FactSet forecast revenue of $6.87 billion.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

February 12, 2026 18:28 ET (23:28 GMT)