Applied Materials (AMAT) swung a profit during its first quarter of fiscal 2010, spurred by strong sales of its semiconductor manufacturing equipment and improving customer demand, the company said Wednesday. The Santa Clara, Calif.-based company raised its full-year revenue target to reflect what CEO Mike Splinter said was higher-than-anticipated demand in the company's semiconductor, LCD display and crystalline silicon solar businesses.Applied reported a profit of $83 million, or 6 cents per share, in its first quarter, which ended Jan. 31, 2010, compared to a loss of $133 million, or 10 cents per share, in the first quarter of 2009.
The company's sales rose to $1.85 billion during the quarter from $1.33 billion in the year-ago quarter.
Applied expects its net sales to grow by more than 50% during 2010, up from its earlier projection of growth topping 30%. That growth will be driven by largely by increased demand for the memory chips that Applied's customers manufacture, including flash memory and DRAM, a type of temporary memory commonly used in laptop and desktop computers.
The company also expects increased customer spending on its products for the manufacture of video display and solar power panels, driven in part by China's solar power capacity expansion plans.
"We view 2010 as just the first year of a strong investing cycle," Splinter told investors during the company's first-quarter earnings call, Wednesday. "We expect this year to have strong competitive gains, with market share of more than 2%," he said.
Splinter also commented on the recent arrest of several Applied employees in South Korea recently in connection with a criminal investigation into the alleged improper receipt and use of confidential information from Samsung, one of Applied Materials' biggest customers.
"We are working with the Korean prosecutor and also conducting our own investigation," he said. "The conduct described by the charges are not consistent with our policies ... and it's important to note that Applied Materials has not been charged in this matter," he said.
Share of Applied rose slightly in after-hours trading, changing hands at $13.18 per share, up 19 cents from $12.99, their value at the market's close.
Applied Materials Swings First Quater Profit on Strong Sales