Applied Materials Inc (NASDAQ:AMAT) stock fell 6.62% (As on May 16, 11:20:10 AM UTC-4, Source: Google Finance) after the company delivered mixed results in its latest quarter. This is due to chip-making equipment maker’s biggest segment amid uncertainties around export curbs. Applied Materials generated a profit of $2.13 billion in the quarter, up from $1.72 billion in net income in the year-ago period. Revenue from the semiconductor systems segment, the largest contributor to the company’s total revenue, was $5.26 billion, below analysts’ estimate of $5.32 billion, according to data compiled by LSEG. Applied Materials noted a slowdown in investment in ICAPS market — covering internet of things, communication, automotive, power and sensors — but said this has been partially offset by huge investments in advanced chips. The U.S. government had said in December new controls would be placed on the export of semiconductor manufacturing equipment needed to produce advanced-node chips to China — Applied Materials’ largest overseas market. The company’s revenue from China, which is engaged in a full-blown trade war with the U.S., accounted for about 25% of total sales during the second quarter, down from 43% a year earlier.

Moreover, for the quarter, Semiconductor Systems’ revenue was of $5.26 billion, with a 36.2% operating margin. Applied Global Services revenue was of $1.57 billion, with a 28.5% operating margin. Display revenue was of $259 million, with a 26.3% operating margin.

AMAT in the second quarter of FY25 has reported the adjusted earnings per share of $2.39, beating the analysts’ estimates for the adjusted earnings per share of $2.31. This growth was driven by strong demand in the Semiconductor Systems segment and ongoing innovation in AI technologies. The company had reported the adjusted revenue growth of 7 percent to $7.1 billion in the second quarter of FY25, missing the analysts’ estimates for revenue of $7.13 billion, according to data compiled by LSEG. For the quarter, the company delivered non-GAAP gross margin of 49.2% and non-GAAP operating margin of 30.7%.

Additionally, the company generated $1.57 billion in cash from operations and distributed $2.00 billion to shareholders including $1.67 billion in share repurchases and $325 million in dividends.

Looking at the current quarter, the company said it’s targeting revenue of $7.2 billion at the midpoint of its range, compared with analysts’ average estimate of $7.19 billion, according to data compiled by LSEG. For Q3, the company forecast non-GAAP earnings per diluted share of $2.35, compared with estimates of $2.31.