Applied Materials, Inc. (NASDAQ:AMAT) shares tanked in morning trading on Friday, even after the company reported upbeat fiscal fourth-quarter earnings.

The company reported its results amid an exciting earnings season. Here are some key analyst takeaways.

Needham On Applied Materials

Analyst Charles Shi maintained a Buy rating while reducing the price target from $240 to $225.

Applied Materials reported a “solid” beat for revenue and earnings, Shi said in a note. Following an unexpected decline in the previous quarter, the company’s China revenues came in roughly flat at around $2.14 billion, “but still a meaningful step down” from the average run rate of $2.9 billion per quarter between the fourth quarter of 2023 to the second quarter of 2024, he added.

Management’s forward guidance was underwhelming, indicating sequential growth of merely 1.5% in the fiscal first quarter, versus Street expectations of 4.5% growth, the analyst stated. “Over the longer term, management sees that WFE (wafer fabrication equipment) intensity, propped up by the strong China demand of 18% in 2023, could decline and normalize to around 15%,” he further wrote.

Goldman Sachs On Applied Materials

Analyst Toshiya Hari reiterated a Buy rating while raising the price target from $228 to $230.

Applied Materials reported quarterly revenues of $7.05 billion, beating consensus by 1%, and non-GAAP gross margin of 47.5%, exceeding guidance by 10 basis points (bps), Hari said. Non-GAAP earnings came in at $2.32 per …

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