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Applied Materials Names New CEO as Profit Slips
Dickerson Named CEO as Sales, Profit Fall at Maker of Chip-Manufacturing Gear
Applied Materials Inc. AMAT +1.92%on Thursday said Michael Splinter is yielding the chief executive post to Gary Dickerson, his top lieutenant, as customers appear cautious about buying more of the company's semiconductor-manufacturing tools.
Reuters Applied Materials' Michael Splinter with President Barack Obama as they visited the firm's Austin, Texas, plant in May.
Mr. Splinter, 62 years old, has led the Silicon Valley company for a decade and will remain executive chairman.
Mr. Dickerson, 56, who has recently been serving as president, joined Applied after its 2011 acquisition of Varian Semiconductor Equipment Associates Inc.
Applied is a big name in equipment used to make semiconductors, video displays and solar panels. Its earnings have long reflected boom-and-bust cycles in those markets, particularly as chip makers move to boost output or shift to new generations of production processes.
The company's fiscal third-quarter results, announced Thursday along with the leadership transition, show the current mood of many chip makers to keep a tight rein on buying more manufacturing gear.
Applied's net income declined 23% for the quarter ended July 28, while revenue fell 16%. The company projected revenue in the current quarter will be roughly flat with the third period.
In after-hours trading Thursday following the announcements, Applied's shares were down 2.1% to $15.
Despite the current pressures, Mr. Dickerson expressed confidence with the company's position.
Among other things, chip makers are moving to new styles of production—including new transistor structures—that will require new technologies that Applied believes play to its strength.
"We have good momentum in our markets, and the transitions that are happening favor Applied," Mr. Dickerson said.
The most cautious among Applied's customers currently are companies known as foundries that produce chips designed by others, the company said. But other types of customers, including makers of memory chips, have been more bullish about spending.
Meanwhile, demand for mobile devices and larger TV sets is fueling a broad need for semiconductors, Applied said.
For its third quarter, Applied's net income declined to $168 million, or 14 cents a share, compared with $218 million, or 17 cents, a year earlier. Revenue fell to $1.98 billion from $2.34 billion. |
