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Don't Overlook Applied Materials (AMAT) International Revenue Trends While Assessing the Stock

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Have you assessed how the international operations of Applied Materials (AMAT - Free Report) performed in the quarter ended July 2025? For this maker of chipmaking equipment, possessing an expansive global footprint, parsing the trends of international revenues could be critical to gauge its financial resilience and growth prospects.

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.

Participation in global economies acts as a defense against economic difficulties at home and a pathway to more rapidly developing economies. However, it also comes with the complexities of dealing with fluctuating currencies, geopolitical risks and different market dynamics.

Upon examining AMAT's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.

The company's total revenue for the quarter stood at $7.3 billion, increasing 7.7% year over year. Now, let's delve into AMAT's international revenue breakdown to gain insights into the significance of its operations beyond home turf.

Unveiling Trends in AMAT's International Revenues

Of the total revenue, $1.16 billion came from Korea during the last fiscal quarter, accounting for 15.9%. This represented a surprise of -17.51% as analysts had expected the region to contribute $1.41 billion to the total revenue. In comparison, the region contributed $1.56 billion, or 22%, and $1.1 billion, or 16.3%, to total revenue in the previous and year-ago quarters, respectively.

Taiwan generated $1.84 billion in revenues for the company in the last quarter, constituting 25.2% of the total. This represented a surprise of +28.37% compared to the $1.44 billion projected by Wall Street analysts. Comparatively, in the previous quarter, Taiwan accounted for $2 billion (28.1%), and in the year-ago quarter, it contributed $1.15 billion (16.9%) to the total revenue.

During the quarter, China contributed $2.55 billion in revenue, making up 34.9% of the total revenue. When compared to the consensus estimate of $2.13 billion, this meant a surprise of +19.64%. Looking back, China contributed $1.77 billion, or 25%, in the previous quarter, and $2.15 billion, or 31.8%, in the same quarter of the previous year.

Europe accounted for 2.2% of the company's total revenue during the quarter, translating to $160 million. Revenues from this region represented a surprise of -52.96%, with Wall Street analysts collectively expecting $340.12 million. When compared to the preceding quarter and the same quarter in the previous year, Europe contributed $252 million (3.6%) and $339 million (5%) to the total revenue, respectively.

During the quarter, Japan contributed $713 million in revenue, making up 9.8% of the total revenue. When compared to the consensus estimate of $576.22 million, this meant a surprise of +23.74%. Looking back, Japan contributed $572 million, or 8.1%, in the previous quarter, and $555 million, or 8.2%, in the same quarter of the previous year.

Of the total revenue, $195 million came from Southeast Asia during the last fiscal quarter, accounting for 2.7%. This represented a surprise of -34.96% as analysts had expected the region to contribute $299.81 million to the total revenue. In comparison, the region contributed $135 million, or 1.9%, and $428 million, or 6.3%, to total revenue in the previous and year-ago quarters, respectively.

International Market Revenue Projections

It is projected by analysts on Wall Street that Applied Materials will post revenues of $6.82 billion for the ongoing fiscal quarter, a decline of 3.2% from the year-ago quarter. The expected contributions from Korea, Taiwan, China, Europe, Japan and Southeast Asia to this revenue are 21.8%, 22.2%, 31.1%, 5%, 8.5%, and 3.9%, translating into $1.49 billion, $1.51 billion, $2.12 billion, $339.9 million, $581.04 million, and $264.85 million, respectively.

For the full year, a total revenue of $28.55 billion is expected for the company, reflecting an increase of 5.1% from the year before. The revenues from Korea, Taiwan, China, Europe, Japan and Southeast Asia are expected to make up 21.4%, 21.5%, 29%, 4.4%, 8%, and 3.5% of this total, corresponding to $6.12 billion, $6.13 billion, $8.27 billion, $1.26 billion, $2.27 billion, and $985.66 million, respectively.

Closing Remarks

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.

In a world where international interdependencies and geopolitical conflicts are ever-increasing, Wall Street analysts closely monitor these trends for companies having international presence to adjust their earnings forecasts. Of course, there are several other factors, including a company's standing within its home borders, that influence analysts' 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.

Boasting a remarkable track record that's been externally verified, the Zacks Rank, our unique stock rating system, leverages changes in earnings projections to function as a reliable gauge for predicting short-term stock price movements.

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 >>>> .

Reviewing Applied Materials' Recent Stock Price Trends

The stock has witnessed a decline of 15.1% over the past month versus the Zacks S&P 500 composite's an increase of 3.5%. In the same interval, the Zacks Computer and Technology sector, to which Applied Materials belongs, has registered an increase of 4.9%. Over the past three months, the company's shares saw an increase of 2.7%, while the S&P 500 increased by 9.3%. In comparison, the sector experienced an increase of 15.8% during this timeframe.


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