{"id":1990,"date":"2025-10-03T20:00:31","date_gmt":"2025-10-03T20:00:31","guid":{"rendered":"https:\/\/retrotradingreport.com\/index.php\/2025\/10\/03\/applied-materials-decline-after-710m-revenue-hit-from-us-export-restrictions\/"},"modified":"2025-10-03T20:00:31","modified_gmt":"2025-10-03T20:00:31","slug":"applied-materials-decline-after-710m-revenue-hit-from-us-export-restrictions","status":"publish","type":"post","link":"https:\/\/retrotradingreport.com\/index.php\/2025\/10\/03\/applied-materials-decline-after-710m-revenue-hit-from-us-export-restrictions\/","title":{"rendered":"Applied Materials decline after $710M revenue hit from US export restrictions"},"content":{"rendered":"
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Applied Materials, one of the world\u2019s largest suppliers of semiconductor manufacturing equipment, is bracing for a significant financial setback as new US export restrictions tighten the flow of chipmaking tools to China. <\/p>\n

The company disclosed in a filing Thursday that the rules could reduce its revenue by $710 million over the next two years, adding to mounting challenges in a critical market.<\/p>\n

Applied Materials shares fell 2.32% to $218.40 on Friday afternoon session.<\/p>\n

Revenue impact <\/h2>\n

The Bureau of Industry and Security\u2019s updated restrictions mean Applied Materials will need a license to export certain products to China-based customers. <\/p>\n

The company estimates the measures will cut $110 million from its fourth-quarter revenue and shave $600 million from its 2026 results.<\/p>\n

China accounts for roughly 30% of Applied Materials\u2019 sales so far this year, making the restrictions a meaningful headwind. <\/p>\n

Stifel analyst Brian Chin noted that the company had already signaled a sharp decline in Chinese sales and now faces an additional drag. <\/p>\n

He projected a 10% quarter-on-quarter sales decline for the fourth quarter.<\/p>\n

Investors responded cautiously on Friday. <\/p>\n

Applied Materials stock fell over 2%, while its industry peers Lam Research and KLA also edged lower, falling 0.28% and 2.46% respectively. <\/p>\n

Despite the pullback, shares of all three companies have posted strong gains in 2024, reflecting broader industry momentum.<\/p>\n

Sector strength offsets short-term pressure<\/h2>\n

The new restrictions are unlikely to erase the impressive gains semiconductor equipment suppliers have delivered this year. <\/p>\n

Applied Materials stock is up 37% year-to-date as of Thursday\u2019s close, while Lam Research has surged 104% and KLA has advanced 81%. <\/p>\n

Those gains have been supported by rising demand for wafer fabrication equipment (WFE), a crucial segment for the global semiconductor supply chain.<\/p>\n

However, US policy efforts to curb China\u2019s domestic chipmaking ambitions add a layer of uncertainty. <\/p>\n

The Trump administration is targeting Chinese semiconductor independence, which could pressure US suppliers in the near term. <\/p>\n

At the same time, the restrictions may accelerate Beijing\u2019s efforts to achieve self-sufficiency, creating longer-term risks for the industry.<\/p>\n

China represents between 20% and 25% of the global WFE market, according to Rothschild & Co Redburn analyst Timm Schulze-Melander. <\/p>\n

Domestic Chinese equipment makers already command 11% to 13% of global market share in certain segments, signaling rising competition for US firms.<\/p>\n

Rising competitive pressures<\/h2>\n

Among US suppliers, Applied Materials is seen as particularly vulnerable to Chinese competition. <\/p>\n

Schulze-Melander highlighted the company\u2019s reliance on its Physical Vapor Deposition (PVD) equipment business, which accounts for nearly one-third of its operating profits. <\/p>\n

That segment is at risk of losing share to local rivals as China expands its domestic capabilities.<\/p>\n

\u201cOur analysis concludes that while almost all semicap equipment suppliers face some degree of challenge from China-based rivals, Applied Materials\u2019 earnings base is the most threatened by China competition,\u201d Schulze-Melander wrote in a recent note.<\/p>\n

The analyst has a Neutral rating and a $190 target price on Applied Materials, suggesting limited upside from current levels. <\/p>\n

While the company retains a strong market position and benefits from global chip demand, the combination of export restrictions and intensifying competition in China presents a material challenge to its longer-term growth trajectory.<\/p>\n<\/p>\n

The post Applied Materials decline after $710M revenue hit from US export restrictions<\/a> appeared first on Invezz<\/a><\/p>\n

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Applied Materials, one of the world\u2019s largest suppliers of semiconductor manufacturing equipment, is bracing for a significant financial setback as new US export restrictions tighten the flow of chipmaking tools to China. The company disclosed in a filing Thursday that the rules could reduce its revenue by $710 million over the next two years, adding…<\/p>\n","protected":false},"author":1,"featured_media":1991,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-1990","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"_links":{"self":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/posts\/1990","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/comments?post=1990"}],"version-history":[{"count":0,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/posts\/1990\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/media\/1991"}],"wp:attachment":[{"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/media?parent=1990"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/categories?post=1990"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/retrotradingreport.com\/index.php\/wp-json\/wp\/v2\/tags?post=1990"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}