Applied Materials Inc.'s third-quarter net income dropped 65% on lower sales and margins.

"Applied Materials delivered financial and operational performance that was in line with our quarter forecast during a difficult semiconductor industry environment," said Chief Executive Michael Splinter.

For the quarter ended July 27, the biggest supplier of semiconductor- manufacturing equipment by revenue reported net income of $164.8 million, or 12 cents a share, down from $473.5 million, or 34 cents a share, a year earlier.

Excluding restructuring, acquisition and stock-option costs, earnings fell to 17 cents a share from 37 cents.

Revenue fell 28% to $1.85 billion.

In May, the company predicted earnings of 10 cents to 14 cents a share and revenue would fall 10% to 18%, which translates to $2.3 billion to $2.1 billion. Analysts' latest mean estimates were for per-share earnings of 14 cents on revenue of $1.84 billion, down 28%, according to a poll by Thomson Reuters.

Gross margin fell to 40.2% from 47.5%.

New equipment orders - a closely watched metric for Applied Materials - fell 11% to $2.03 billion, less than the company's May estimate of a 15% to 25% decline.

Backlog at the end of the quarter was $4.74 billion, up 38%.

By: DocMemory
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