Semiconductor company Applied Materials (AMAT) will report Q2 FY26 earnings on Wednesday, May 14. Ahead of the results, the company announced a new AI chip development partnership with Taiwan Semiconductor Manufacturing (TSM). Applied said the partnership aims to help bring new chip technologies to production faster. Meanwhile, AMAT stock has surged about 73% this year, driven by strong demand for its chipmaking equipment used in advanced AI processors and High-Bandwidth Memory (HBM) chips.
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Wall Street analysts expect Applied Materials to post earnings per share of $2.68 in Q2, up 12% from the year-ago quarter. Meanwhile, revenue is projected at about $7.68 billion, representing an 8% year-over-year increase.
Investors have also been encouraged by the company’s strong profit margins and its strong position in supplying tools for next-generation semiconductor manufacturing.
Top Analysts’ Views on AMAT Ahead of Q2 Results
Ahead of Applied’s Q2 results, top Cantor Fitzgerald analyst C.J. Muse reiterated an Overweight rating on Applied and raised his price target to $550. The analyst said demand trends have improved over the past three months, with customers continuing to expand long-term chipmaking plans tied to the AI boom. Muse expects Applied Materials to deliver strong results and guidance, while also calling the stock a “Top Pick” due to its strong position in the multi-year AI semiconductor spending cycle.
Likewise, another top analyst Adithya Metuku of HSBC initiated coverage on Applied with a Buy rating and a $517 price target. The analyst said Applied has one of the strongest portfolios of chipmaking tools in the industry, putting it in a good position to benefit from rising demand for advanced semiconductors and AI chips. HSBC expects revenue growth to accelerate over the next two years, driven by strong demand from memory and advanced logic chipmakers, and believes further upside is possible if industry spending continues to improve.
Options Traders Anticipate an 8.27% Move
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you.
Indeed, it currently says that options traders are expecting an 8.27% move in either direction.
Is Applied Materials Stock a Good Buy?
On Wall Street, Applied Materials’ shares continue to enjoy a Strong Buy consensus rating from analysts. This is based on 28 Buys and one Hold issued over the past three months. In addition, the average AMAT price target of $444.70 implies about 0.24% upside.
