SOURCE: Paragon Financial Limited

Paragon Financial Limited

July 11, 2012 08:20 ET

Applied Materials and Rambus Shares Fall as Demand in China and Europe Slowing

The Paragon Report Provides Stock Research on Applied Materials and Rambus

NEW YORK, NY--(Marketwire - Jul 11, 2012) - It has been a tough week for semiconductor companies as recent reports from both Advanced Micro Devices and Applied Materials signaled demand from China and Europe is slowing. The Philadelphia Semiconductor Index (SOX) has fallen over 5 percent in the last week. "Both China and Europe are quite weak," Michael Splinter, Applied Materials' Chief Executive said. "Both markets are worse than they were at this time last year." The Paragon Report examines investing opportunities in the Semiconductor Industry and provides equity research on Applied Materials, Inc., (NASDAQ: AMAT) and Rambus Inc. (NASDAQ: RMBS).

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Applied Materials, producer of chip making equipment, on Tuesday stated that revenue for the fiscal year to fall short of previous estimates of $9.1 billion to $9.5 billion and adjusted per-share earnings of 85 cents to 95 cents. A new forecast will be provided after the company reports its earnings for the coming quarter. Applied cited a "weaker than expected near-term demand in its semiconductor equipment business, primarily among foundry customers."

The announce came shortly after Advanced Micro Devices reported weaker-than-expected demand due to "business conditions that materialized late in the second quarter, specifically softer-than-expected channel sales in China and Europe as well as a weaker consumer buying environment impacting the company's [manufacturing] business."

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Applied Materials expects non-GAAP earnings per share (EPS) below the previous range of $0.85 to $0.95. The company will provide a new target range during its August 15 earnings call; however it expects that the demand changes could have a $0.15 to $0.20 impact on full-year non-GAAP EPS results.

Rambus is one of the world's premier technology licensing companies. As a company of inventors, Rambus focuses on the development of technologies that enrich the end-user experience of electronic systems. The company reported revenue for the first quarter of 2012 was $62.9 million, down 25% sequentially from the fourth quarter of 2011.

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