Applied Materials Earnings: Traders Brace for the Move—Here’s the Expected Volatility

All eyes are on the chip gear giant as earnings drop—traders are already pricing in the swing.

The Options Market Speaks

Forget the analyst whispers. The real forecast lives in the options chain, where contracts are pricing a specific, quantifiable move up or down. It's the market's collective bet on post-earnings chaos—or calm.

Why This One Matters

Applied Materials sits at the epicenter. Its tools build the semiconductors powering everything from AI data centers to the next-gen devices in your pocket. A beat or miss doesn't just move one stock—it sends ripples through the entire tech ecosystem.

Playing the Numbers Game

The implied volatility tells the tale. That number, baked into option premiums, is the market's cold, hard math on expected price turbulence. It's the fee for a front-row seat to the earnings spectacle—because on Wall Street, they'll always charge you for the popcorn.

So, will the stock surge on robust guidance or crater on a capex slowdown? The tape will decide. But one thing's certain: in a market hungry for catalysts, this earnings print is a full-course meal.

Key Takeaways

• Applied Materials is slated to report its latest quarterly results Thursday afternoon, with traders expecting the stock could climb to new highs after the report.
• Sales and profits are expected to decline year-over-year amid trade headwinds, though analysts said they see meaningful improvement from when the company last reported results in November.

Applied Materials is set to post fiscal first-quarter earnings after the market closes on Thursday, with traders anticipating the semiconductor equipment maker's stock could reach new highs following the results.

Options pricing suggests traders expect Applied Materials (AMAT) shares could move about 6% in either direction. A move of that size from Tuesday's close at $329 WOULD lift shares to $350, above their January record. The low end of the range would bring shares back down to around $308.

Applied Materials, which is a leading producer of equipment for semiconductor manufacturing, has seen its shares jump nearly 30% since the start of this year, and more than 80% in the last 12 months amid strong demand for chips and AI hardware.

Why This Matters to Investors

Applied Materials is one of the largest makers of semiconductor manufacturing equipment, and it has seen its stock surge amid the AI boom. However, trade headwinds have hampered sales in recent quarters.

Though Applied Materials is seen reporting a decline in sales and profits year-over-year as the company has grappled with headwinds from export restrictions to China and geopolitical uncertainty, analysts from Morgan Stanley said ahead of the report that demand likely "meaningfully" improved from when the company last reported results in November.

UBS analysts, hiking their price target to $405 from $285, said recently that they expect Applied Materials to top consensus estimates, with results seen getting a boost from "catch-up" sales to China.

Applied Materials is expected to report adjusted earnings per share of $2.21, down from $2.38 the same time a year ago, and a 3.8% decline in revenue to $6.89 billion, according to estimates compiled by Visible Alpha.

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Analysts are broadly bullish on the company's stock, with 11 of the 13 analysts with current ratings tracked by Visible Alpha calling it a "buy," compared to just two "hold" ratings. Their average price target just above $366 would suggest upside of about 11% from Tuesday's close.