Applied Materials Under DOJ Investigation for Alleged Export Violations

Despite the probe, the semiconductor equipment maker reports better-than-expected fiscal fourth-quarter results and forecasts above-estimate first-quarter revenue.

Applied Materials, the largest U.S. semiconductor equipment maker, is under criminal investigation by the U.S. Justice Department for allegedly evading export restrictions by sending equipment worth hundreds of millions of dollars to Chinese chipmaker SMIC without export licenses.
The equipment was reportedly shipped to SMIC via South Korea, starting after the U.S. Commerce Department added SMIC to its 'Entity List' in December 2020, which restricted exports of goods and technology to the company due to its apparent ties to the Chinese military.
Despite the ongoing investigation, Applied Materials reported better-than-expected results for its fiscal fourth quarter, with a net income of $2 billion and earnings per share of $2.12, up from net income of $1.6 billion and earnings per share of $1.85 in the year-ago quarter.
China accounted for 44% of Applied Materials' total sales, with the company suggesting that China sales could remain 'elevated' in the current period due to large shipments to a computer memory customer.
Applied Materials has forecast first-quarter revenue above Wall Street estimates, helped by a recovery in the personal computer market and rising demand for artificial intelligence tools.

South China Morning Post

Reuters

CNA