(Reuters) -Semiconductor equipment maker Applied Materials on Thursday forecast fourth-quarter results above market estimates on strong demand from chipmakers setting up new plants.
Shares of the company rose nearly 3% in extended trading after Applied Materials also beat third-quarter estimates for revenue and profit.
Governments across the globe have doled out billions of dollars in subsidies in the past year to boost domestic semiconductor production, which benefited companies such as Applied Materials and KLA whose tools are essential in chip making.
The companies have also gained from China’s efforts to stock up on tools for making chips with legacy technologies after U.S. export control rules blocked sales of more advanced chipmaking technologies to the country.
Santa Clara, California-based Applied Materials posted third-quarter revenue of $6.43 billion, beating analysts’ average estimate of $6.16 billion, according to Refinitiv data.
On an adjusted basis, it earned $1.90 per share in the quarter ended July 30, beating estimates of $1.74.
The company’s tools for semiconductor production are used by firms such as Samsung Electronics, Taiwan Semiconductor Manufacturing Co, and Intel Corp.
“Over the past several years, we have focused our strategy and investments on key technologies to accelerate the Internet of Things and AI era,” said CEO Gary Dickerson.
Applied Materials expects fourth-quarter revenue of $6.51 billion, plus or minus $400 million, compared with analysts’ average estimate of $5.86 billion.
It forecast adjusted profit per share between $1.82 and $2.18, above market estimate of $1.61.
(Reporting by Jaspreet Singh in Bengaluru; Editing by Shinjini Ganguli)
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