A drop in share price is usually the opposite of what happens when a company delivers an estimate-beating quarter. Yet that was the unhappy dynamic experienced by Applied Materials (AMAT -2.19%) investors on Friday, when their stock traded more than 3% down following the release of the tech equipment maker's latest set of earnings.
For its fiscal third quarter, Applied Materials booked just over $6.5 billion in revenue, which was not only up 5% on a year-over-year basis, but also a new all-time high for the metric. Going in the opposite direction was adjusted net income, which sagged by 3% to land at $1.68 billion ($1.94 per share).
Both line items topped the average analyst estimates. Collectively, those folks were modeling $6.27 billion on the top line, and $1.78 per share in adjusted net income.
Applied Materials could have done better, however, had it not been exposed to the difficulties throughout the industrial world, particularly in the tech sector -- specifically, the supply chain hiccups that have bedeviled the global economy for much of this year.
Management sounded hopeful about the immediate future, with CEO Gary Dickerson saying, " We feel confident in our ability to navigate macroeconomic headwinds and remain very positive about the long-term strength of the semiconductor market and our outsized growth opportunities."
Putting its money where its mouth is, Applied Materials guided for growth in the current fourth quarter. The company believes its net sales will come in at $6.65 billion, plus or minus $400 million. Adjusted per-share earnings should be $1.82 to $2.18. Those figures for the same quarter of 2021 were, respectively, $6.12 billion and $1.94.