Applied Materials Inc (NASDAQ:AMAT) stock rose 9.52% (As on February 13, 11:33:29 AM UTC-4, Source: Google Finance) after the company reported earnings and revenue beats in its fiscal 2026 first quarter and also provided an outlook ahead of expectations thanks to increased demand for its chips driven by the ongoing artificial intelligence boom. The company is ramping investment in AI infrastructure is boosting demand for advanced logic technologies, high-bandwidth memory (HBM) and sophisticated packaging techniques. HBM, which is essential to high-end AI processors such as Nvidia’s, is at the center of a sharp squeeze in global supply. Applied Materials generated $1.69 billion in cash from operations in the quarter and distributed $702 million to shareholders through $337 million in share repurchases and $365 million in dividends. Profit jumped 70% to $2.03 billion, or $2.54 a share, in the quarter ended in January, compared with $1.19 billion, or $1.45 a share, a year earlier.

Moreover, business highlights in the quarter included the announcement that Samsung Electronics Co. Ltd. will join Applied Materials’s new EPIC Center in Silicon Valley, a facility intended to accelerate the transition of semiconductor technologies from early-stage research into high-volume manufacturing. The EPIC Center is designed to shorten development cycles by enabling closer collaboration between chipmakers, materials suppliers and equipment engineers working on next-generation process technologies. The company also introduced new deposition, etch and materials modification systems that are aimed at improving the energy efficiency and performance of Gate-All-Around transistors and advanced interconnects at the two-nanometer node and beyond.

AMAT in the fourth quarter of FY25 has reported the adjusted earnings per share of $2.38, beating the analysts’ estimates for the adjusted earnings per share of $2.21. The company had reported the adjusted revenue decline of 2 percent to $7.012 billion in the fourth quarter of FY25, beating the analysts’ estimates for revenue of $6.87 billion. Revenue from the division focused on DRAM memory tools rose 34%, accelerating from the 27% recorded a year earlier.

For its fiscal 2026 second quarter, Applied Materials expects adjusted earnings per share of $2.24 to $2.84 on revenue of $7.165 billion to $8.150 billion, the latter well ahead at the midpoint of the $7 billion expected by analysts. The company expects revenue of about $7.65bn, plus or minus $500m, compared with the $7.01bn forecast by analysts. In addition, AMAT expects demand and growth momentum in AI to continue through 2027, which is the year in which global semiconductor industry revenues can hit $1 trillion.