New York, Feb 14, 2026, 10:10 ET — Market closed.
Applied Materials Inc (AMAT) finished Friday at $354.91, jumping $26.52, or 8.1%. Earlier, the stock had surged as high as $376.32 before pulling back. After hours, it gave up a slight amount, but the wild swing set the stage for a rapid revaluation of the chip-equipment giant right before the long weekend. 1
Investors eyeing chip equipment demand for AI capacity got a fresh signal from Applied’s latest outlook, which nudged the conversation back to growth mode. Memory demand is the wildcard here—now playing a central role in the trajectory.
No trading in U.S. equities Monday, with Washington’s Birthday—Presidents Day—shutting markets. The next real gauge of sentiment comes Tuesday, when new broker notes and moves in sector peers start appearing on screens. 2
Applied is guiding for second-quarter revenue at roughly $7.65 billion, give or take $500 million, and expects adjusted earnings of around $2.64 per share, with a 20-cent swing either way. For the January 25 quarter, the top U.S. maker of chip equipment posted $7.01 billion in revenue and adjusted EPS of $2.38—both ahead of what analysts were looking for, according to LSEG. “Memory and logic-foundry capital spending were two sides of the same coin,” noted Redburn’s Timm Schulze-Melander, pointing to memory as the stronger catalyst in the short run. 3
Applied’s latest earnings report showed $1.69 billion in cash flow from operations, with $702 million given back to shareholders—$337 million of that through buybacks. CEO Gary Dickerson pointed to “the acceleration of industry investments in AI computing” as driving demand. He also projected growth of more than 20% for Applied’s semiconductor equipment business this calendar year. CFO Brice Hill added that system manufacturing capacity has “nearly doubled” over the last several years to meet customer needs. 4
High-bandwidth memory—HBM for short—stacks up DRAM right alongside pricey AI processors, but lately it’s become a supply chain choke point. Applied’s outlook now leans on that build-out, as well as advanced packaging tools for connecting and stacking chips even closer.
Reuters tallied at least 22 brokerages raising price targets following the report, with several analysts calling this the opening act of a longer stretch for chip equipment. “We expect a massive wafer fabrication equipment growth cycle over the next three years,” said Morningstar’s William Kerwin. He pointed to “immense” demand for artificial intelligence infrastructure, while “supply is scarce.” SEMI, the industry group, projects chipmaking equipment sales reaching $126 billion in 2026 and $135 billion for 2027, according to Reuters. 5
Applied’s bullish outlook sent Lam Research and KLA higher Friday, as traders moved money back into semiconductor equipment stocks. This group is quick to react—chipmakers tweak capex, shares jump or slide.
Still, it’s hardly a clear path. U.S. toolmakers face ongoing risks tied to export controls and compliance when dealing with China. Back on Feb. 11, Applied disclosed it settled with the Commerce Department’s Bureau of Industry and Security, agreeing to a $252.5 million payment over previous shipments. The Justice Department and SEC, on the other hand, wrapped up their investigations with no further action. 6
Markets will be closed Monday. Eyes turn to Tuesday’s open to see if the sector can hang onto recent gains, especially in the absence of new headlines. Nvidia is on the calendar with results set for Feb. 25—a date investors routinely circle as a marker for AI spending in the chip supply chain. 7
