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Applied Materials Shares Surge on Strong Earnings

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  Published in Stocks and Investing on Friday, February 13th 2026 at 15:29 GMT by Investopedia
      Locales: UNITED STATES, TAIWAN PROVINCE OF CHINA, JAPAN

Santa Clara, CA - February 13th, 2026 - Shares of Applied Materials (AMAT) experienced a significant surge today, climbing over 4% in extended trading following the release of a remarkably strong earnings report. The positive performance underscores the critical role the company plays in the burgeoning artificial intelligence (AI) revolution, and signals continued growth potential in the semiconductor industry.

Applied Materials reported total revenue of $17.85 billion for the latest quarter, exceeding analyst expectations of $17.63 billion. Perhaps even more impressive was the adjusted earnings per share (EPS), which reached $2.01 - comfortably surpassing the projected $1.88. This financial performance isn't simply a momentary win; it's indicative of a sustained trend fueled by unprecedented demand for advanced chips.

AI: The Engine of Growth

The driving force behind these results is, unequivocally, the relentless demand for chips specifically designed for AI applications. As CEO Rick Flax stated in a recent earnings call, "The demand for AI chips is so intense that it's difficult to keep up." This isn't hyperbole. The global race to develop and deploy AI solutions - ranging from generative AI models like the ones powering large language models to the complex processing requirements of autonomous vehicles - is creating a voracious appetite for specialized semiconductors.

Applied Materials isn't a chip manufacturer itself; instead, it's a vital enabler. The company is a leading materials engineering firm, providing the essential equipment, services, and software that chipmakers rely on to design and manufacture the increasingly intricate microchips powering the modern world. This positions Applied Materials uniquely within the supply chain, benefitting from all growth in chip demand, regardless of the specific application.

Beyond AI: A Broadening Horizon

While AI is the current headline driver, Applied Materials' strength extends beyond this single sector. CFO John Henderson highlighted the company's optimistic outlook, stating they "anticipate that the strength in our semiconductor business will continue, driven by long-term secular trends like AI, high-performance computing, and electric vehicles." This diversification is key to the company's long-term stability.

• High-Performance Computing (HPC): Beyond AI, HPC continues to grow across diverse applications like scientific research, data analytics, and weather forecasting, all requiring increasingly powerful processors.
• Electric Vehicles (EVs): The automotive industry's transition to electric vehicles is dramatically increasing the demand for semiconductors. Modern cars are essentially computers on wheels, utilizing chips for everything from engine management and battery control to advanced driver-assistance systems (ADAS) and infotainment.
• Display Technology: Applied Materials also plays a role in the display industry, providing solutions for the manufacturing of OLED and LCD screens, though this segment currently represents a smaller portion of overall revenue.

The Future of Chip Manufacturing & Applied Materials' Role

The challenges facing chip manufacturers are considerable. Creating increasingly smaller and more powerful chips requires pushing the boundaries of materials science and engineering. This is where Applied Materials excels. Their expertise in areas like deposition, etching, and ion implantation allows chipmakers to create ever-more-complex designs. The move towards advanced packaging techniques like chiplets, where multiple smaller chips are combined into a single package, further underscores the need for sophisticated materials engineering solutions.

Furthermore, geopolitical factors are impacting the semiconductor landscape. Governments worldwide are investing heavily in domestic chip manufacturing capabilities to reduce reliance on a few key regions. This push for regionalization, combined with ongoing supply chain disruptions, is driving demand for Applied Materials' equipment as companies seek to expand and diversify their production capacity.

Stock Performance & Investor Outlook

As of 3:12 p.m. ET today, AMAT stock closed at $170.79 per share, representing a 3.25% increase. Analysts are largely optimistic about the company's future prospects, with several firms upgrading their price targets in light of the strong earnings report and positive outlook. While cyclicality is inherent in the semiconductor industry, Applied Materials' strong position at the forefront of crucial technological trends suggests it is well-positioned to navigate any future downturns and continue delivering value to shareholders.

Investors will be closely watching upcoming earnings reports and industry trends to gauge the sustained strength of the AI-driven chip demand and Applied Materials' continued success in capitalizing on this growth.