New York, Feb 16, 2026, 16:24 EST — Market closed.
- Applied Materials shares last closed up 8.1% on Friday at $354.91, after swinging between $353.26 and $376.32. (Investing)
- U.S. stock markets are shut for Presidents Day and reopen on Tuesday, delaying the next read on chip-equipment demand. (AP News)
- Investors are weighing upbeat guidance and a U.S. export-control penalty, as analysts lift price targets into next week’s Nvidia results.
Applied Materials (AMAT.O) stock will sit out Monday’s session with U.S. markets closed for Presidents Day, after the shares ended Friday up 8.1% at $354.91. The stock traded as high as $376.32 and as low as $353.26 in the last session, a wide range even by chip-sector standards. (Investing)
The pause matters because Applied’s rally has turned the stock into a bellwether for whether the AI buildout is still pushing chipmakers to spend on new tools. Shares jumped 11% on Friday after the company’s outlook fueled expectations for a fresh leg higher in wafer-fab and packaging spending, with at least 22 brokerages raising price targets, Reuters reported. “We expect a massive wafer fabrication equipment growth cycle over the next three years,” Morningstar analyst William Kerwin said, calling AI infrastructure demand “immense” as supply stays scarce. (Reuters)
Applied projected second-quarter revenue of about $7.65 billion, plus or minus $500 million, and adjusted profit of $2.64 a share, plus or minus 20 cents — both above Wall Street estimates, Reuters reported. The company pointed to tightening supply in memory chips and rising demand for high-bandwidth memory (HBM) — stacks of DRAM, a type of memory chip, used alongside AI processors — as chipmakers expand capacity. “Memory and logic-foundry capex growth are two sides of the same coin,” analyst Timm Schulze-Melander at Rothschild & Co Redburn wrote, adding that memory is the bigger near-term driver. (Reuters)
In its quarterly release, Applied said first-quarter revenue was $7.01 billion and adjusted (non-GAAP) earnings were $2.38 a share. It generated $1.69 billion in operating cash flow and returned $702 million to shareholders through buybacks and dividends. CEO Gary Dickerson said demand tied to AI computing should help the company grow its semiconductor equipment business by more than 20% this calendar year. (SEC)
The near-term upside has a clear scar tissue, though. The U.S. Commerce Department’s Bureau of Industry and Security said Applied and its Korea unit agreed to pay about $252 million over illegal exports of ion implanters — chipmaking tools — to China after routing shipments through South Korea without required licenses. BIS said the $252 million penalty was the maximum allowed by law and said Applied agreed to audits and annual certifications tied to its export compliance program; it also said staff tied to the shipments are no longer employed. “When companies export their products around the world, they must follow the law or face stiff penalties,” BIS under secretary Jeffrey Kessler said. (Bureau of Industry and Security)
Analysts moved quickly after the results. Needham analyst Charles Shi kept a “Buy” rating and raised his price target to $440 from $390, GuruFocus reported. RBC Capital lifted its target to $430 from $385 and said China share-loss concerns looked “overdone,” according to a summary of the note, while MarketScreener reported Wells Fargo raised its target to $435 from $350 and kept an “Overweight” rating. (GuruFocus)
Applied has also tried to keep the narrative on technology and collaboration. Last week it said Samsung Electronics will join its new $5 billion EPIC Center in Silicon Valley, which Applied said will aim to cut years off the path from research to full-scale chip manufacturing; the facility is slated to become operational in spring 2026. Samsung vice chairman and CEO Young Hyun Jun said the companies plan to “deepen” technology collaboration at the center. (GlobeNewswire)
But the stock’s run means it does not take much to rattle sentiment. Any sign that memory spending is peaking, or that tighter export rules choke off shipments and service work, could test the view that the AI-driven tool cycle is a straight line up.
For the next session, traders get their first chance Tuesday to see if the post-earnings bid holds. The next big sector catalyst follows on Feb. 25, when Nvidia is due to report results and host its earnings call at 5 p.m. ET — a read-through for AI infrastructure spending that has been bleeding into every corner of the chip supply chain, including Applied’s order book. (Nvidia)
