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Why Applied Materials (AMAT) International Revenue Trends Deserve Your Attention
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Did you analyze how Applied Materials (AMAT - Free Report) fared in its international operations for the quarter ending July 2024? Given the widespread global presence of this maker of chipmaking equipment, scrutinizing the trends in international revenues becomes imperative to assess its financial strength and future growth possibilities.
In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.
International market involvement serves as insurance against economic downturns at home and enables engagement with economies that are growing more quickly. Still, this move toward diversification is not without its challenges, as it involves navigating through the fluctuations of currencies, geopolitical threats, and the distinctive nature of various markets.
In our recent assessment of AMAT's quarterly performance, we discovered notable trends in its overseas revenue sections, which are typically modeled and scrutinized by Wall Street analysts.
The company's total revenue for the quarter amounted to $6.78 billion, showing rise of 5.5%. We will now explore the breakdown of AMAT's overseas revenue to assess the impact of its international operations.
Unveiling Trends in AMAT's International Revenues
Taiwan accounted for 16.9% of the company's total revenue during the quarter, translating to $1.15 billion. Revenues from this region represented a surprise of +18.23%, with Wall Street analysts collectively expecting $971 million. When compared to the preceding quarter and the same quarter in the previous year, Taiwan contributed $1.02 billion (15.3%) and $1.35 billion (20.9%) to the total revenue, respectively.
Of the total revenue, $2.15 billion came from China during the last fiscal quarter, accounting for 31.8%. This represented a surprise of -18.34% as analysts had expected the region to contribute $2.64 billion to the total revenue. In comparison, the region contributed $2.83 billion, or 42.6%, and $1.73 billion, or 27%, to total revenue in the previous and year-ago quarters, respectively.
Southeast Asia generated $428 million in revenues for the company in the last quarter, constituting 6.3% of the total. This represented a surprise of +127.9% compared to the $187.8 million projected by Wall Street analysts. Comparatively, in the previous quarter, Southeast Asia accounted for $213 million (3.2%), and in the year-ago quarter, it contributed $180 million (2.8%) to the total revenue.
During the quarter, Europe contributed $339 million in revenue, making up 5.0% of the total revenue. When compared to the consensus estimate of $454.72 million, this meant a surprise of -25.45%. Looking back, Europe contributed $289 million, or 4.4%, in the previous quarter, and $661 million, or 10.3%, in the same quarter of the previous year.
Japan accounted for 8.2% of the company's total revenue during the quarter, translating to $555 million. Revenues from this region represented a surprise of +1.59%, with Wall Street analysts collectively expecting $546.3 million. When compared to the preceding quarter and the same quarter in the previous year, Japan contributed $453 million (6.8%) and $478 million (7.4%) to the total revenue, respectively.
During the quarter, Korea contributed $1.1 billion in revenue, making up 16.3% of the total revenue. When compared to the consensus estimate of $993.7 million, this meant a surprise of +10.9%. Looking back, Korea contributed $988 million, or 14.9%, in the previous quarter, and $988 million, or 15.4%, in the same quarter of the previous year.
Anticipated Revenues in Overseas Markets
For the current fiscal quarter, it is anticipated by Wall Street analysts that Applied Materials will report a total revenue of $6.94 billion, which reflects an increase of 3.2% from the same quarter in the previous year. The revenue contributions are expected to be 12.7% from Taiwan ($882.73 million), 41.9% from China ($2.9 billion), 2.8% from Southeast Asia ($191.91 million), 5.8% from Europe ($405.15 million), 8.2% from Japan ($570.34 million) and 14.5% from Korea ($1.01 billion).
For the full year, the company is projected to achieve a total revenue of $27.07 billion, which signifies a rise of 2.1% from the last year. The share of this revenue from various regions is expected to be: Taiwan at 12.7% ($3.43 billion), China at 42% ($11.37 billion), Southeast Asia at 2.9% ($778.71 million), Europe at 5.8% ($1.56 billion), Japan at 7.9% ($2.13 billion) and Korea at 15.6% ($4.22 billion).
The Bottom Line
Applied Materials' reliance on international markets for revenues offers both opportunities and risks. Hence, keeping an eye on its international revenue trends could significantly help forecast the company's prospects.
With the increasing intricacies of global interdependence and geopolitical strife, Wall Street analysts meticulously observe these patterns, especially for companies with an international footprint, to tweak their forecasts of earnings. Importantly, several additional factors, such as a company's domestic market status, also impact these earnings forecasts.
We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.
With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.
A Look at Applied Materials' Recent Stock Price Performance
Over the past month, the stock has lost 5.6% versus the Zacks S&P 500 composite's 1.9% increase. The Zacks Computer and Technology sector, of which Applied Materials is a part, has risen 1% over the same period. The company's shares have declined 4.5% over the past three months compared to the S&P 500's 6% increase. Over the same period, the sector has risen 6.8%.
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Why Applied Materials (AMAT) International Revenue Trends Deserve Your Attention
Did you analyze how Applied Materials (AMAT - Free Report) fared in its international operations for the quarter ending July 2024? Given the widespread global presence of this maker of chipmaking equipment, scrutinizing the trends in international revenues becomes imperative to assess its financial strength and future growth possibilities.
In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.
International market involvement serves as insurance against economic downturns at home and enables engagement with economies that are growing more quickly. Still, this move toward diversification is not without its challenges, as it involves navigating through the fluctuations of currencies, geopolitical threats, and the distinctive nature of various markets.
In our recent assessment of AMAT's quarterly performance, we discovered notable trends in its overseas revenue sections, which are typically modeled and scrutinized by Wall Street analysts.
The company's total revenue for the quarter amounted to $6.78 billion, showing rise of 5.5%. We will now explore the breakdown of AMAT's overseas revenue to assess the impact of its international operations.
Unveiling Trends in AMAT's International Revenues
Taiwan accounted for 16.9% of the company's total revenue during the quarter, translating to $1.15 billion. Revenues from this region represented a surprise of +18.23%, with Wall Street analysts collectively expecting $971 million. When compared to the preceding quarter and the same quarter in the previous year, Taiwan contributed $1.02 billion (15.3%) and $1.35 billion (20.9%) to the total revenue, respectively.
Of the total revenue, $2.15 billion came from China during the last fiscal quarter, accounting for 31.8%. This represented a surprise of -18.34% as analysts had expected the region to contribute $2.64 billion to the total revenue. In comparison, the region contributed $2.83 billion, or 42.6%, and $1.73 billion, or 27%, to total revenue in the previous and year-ago quarters, respectively.
Southeast Asia generated $428 million in revenues for the company in the last quarter, constituting 6.3% of the total. This represented a surprise of +127.9% compared to the $187.8 million projected by Wall Street analysts. Comparatively, in the previous quarter, Southeast Asia accounted for $213 million (3.2%), and in the year-ago quarter, it contributed $180 million (2.8%) to the total revenue.
During the quarter, Europe contributed $339 million in revenue, making up 5.0% of the total revenue. When compared to the consensus estimate of $454.72 million, this meant a surprise of -25.45%. Looking back, Europe contributed $289 million, or 4.4%, in the previous quarter, and $661 million, or 10.3%, in the same quarter of the previous year.
Japan accounted for 8.2% of the company's total revenue during the quarter, translating to $555 million. Revenues from this region represented a surprise of +1.59%, with Wall Street analysts collectively expecting $546.3 million. When compared to the preceding quarter and the same quarter in the previous year, Japan contributed $453 million (6.8%) and $478 million (7.4%) to the total revenue, respectively.
During the quarter, Korea contributed $1.1 billion in revenue, making up 16.3% of the total revenue. When compared to the consensus estimate of $993.7 million, this meant a surprise of +10.9%. Looking back, Korea contributed $988 million, or 14.9%, in the previous quarter, and $988 million, or 15.4%, in the same quarter of the previous year.
Anticipated Revenues in Overseas Markets
For the current fiscal quarter, it is anticipated by Wall Street analysts that Applied Materials will report a total revenue of $6.94 billion, which reflects an increase of 3.2% from the same quarter in the previous year. The revenue contributions are expected to be 12.7% from Taiwan ($882.73 million), 41.9% from China ($2.9 billion), 2.8% from Southeast Asia ($191.91 million), 5.8% from Europe ($405.15 million), 8.2% from Japan ($570.34 million) and 14.5% from Korea ($1.01 billion).For the full year, the company is projected to achieve a total revenue of $27.07 billion, which signifies a rise of 2.1% from the last year. The share of this revenue from various regions is expected to be: Taiwan at 12.7% ($3.43 billion), China at 42% ($11.37 billion), Southeast Asia at 2.9% ($778.71 million), Europe at 5.8% ($1.56 billion), Japan at 7.9% ($2.13 billion) and Korea at 15.6% ($4.22 billion).
The Bottom Line
Applied Materials' reliance on international markets for revenues offers both opportunities and risks. Hence, keeping an eye on its international revenue trends could significantly help forecast the company's prospects.With the increasing intricacies of global interdependence and geopolitical strife, Wall Street analysts meticulously observe these patterns, especially for companies with an international footprint, to tweak their forecasts of earnings. Importantly, several additional factors, such as a company's domestic market status, also impact these earnings forecasts.
We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.
With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.
At present, Applied Materials holds a Zacks Rank #3 (Hold). This ranking implies that its near-term performance might mirror the overall market movement. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
A Look at Applied Materials' Recent Stock Price Performance
Over the past month, the stock has lost 5.6% versus the Zacks S&P 500 composite's 1.9% increase. The Zacks Computer and Technology sector, of which Applied Materials is a part, has risen 1% over the same period. The company's shares have declined 4.5% over the past three months compared to the S&P 500's 6% increase. Over the same period, the sector has risen 6.8%.