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Santa Clara, California-based Applied Materials, Inc. (AMAT) is a provider of manufacturing equipment, services, and software to the semiconductor, display, and related industries. With a market cap of $150.1 billion, Applied Materials operates through Semiconductor Systems, Applied Global Services, and Display and Adjacent Markets segments.
The tech giant is expected to announce its third-quarter results on Thursday, Aug. 21. Ahead of the event, analysts expect AMAT to report a profit of $2.34 per share, up 10.4% from $2.12 per share reported in the year-ago quarter. Furthermore, the company has surpassed the Street’s bottom-line projections in each of the past four quarters.
For the full fiscal 2025, analysts expect AMAT’s EPS to come in at $9.47, up a notable 9.5% from $8.65 reported in fiscal 2024. In fiscal 2026, its earnings are expected to further grow 5.6% year-over-year to $10 per share.
AMAT’s stock prices have dropped 8.9% over the past 52 weeks, notably underperforming the S&P 500 Index’s ($SPX) 17.3% surge and the Technology Select Sector SPDR Fund’s (XLK) 21.1% returns during the same time frame.
Despite delivering record earnings, Applied Materials’ stock prices dropped 5.3% in the trading session after the release of its Q2 results on May 15. The company’s topline for the quarter increased 6.8% year-over-year to $7.1 billion, falling short of the Street expectations by a small margin, which increased investor skepticism, which was already heightened due to concerns over the impact of potential tariffs on the semiconductor industry.
Nonetheless, the company’s overall performance remained more than impressive, its adjusted EPS increased 14.4% year-over-year to $2.39, beating the consensus estimates by 3.5%. Further, its operating cash flows surged 12.9% year-over-year to $1.6 billion.
The consensus view on AMAT stock is optimistic, with a consensus “Moderate Buy” rating overall. Of the 34 analysts covering the stock, opinions include 22 “Strong Buys,” three “Moderate Buys,” and nine “Holds.” Its mean price target of $205.68 suggests a 9.3% upside potential from current price levels.
