Applied Materials Inc (NASDAQ:AMAT) shares jumped 9.6% in after-hours trading Thursday following a strong quarterly performance driven by robust artificial intelligence demand. The Santa Clara-based chip equipment maker reported first-quarter non-GAAP earnings per share of $2.38, beating analyst consensus of $2.21. Revenue reached $7.01 billion, exceeding Wall Street expectations of $6.87 billion despite a 2% year-over-year decline.

Record performance in specific segments bolstered the results, with Semiconductor Systems achieving an all-time high in DRAM revenue. Additionally, the Applied Global Services division delivered record revenue for services and spares as customers maintained high utilization of existing tools. CEO Gary Dickerson attributed the strong results to an acceleration in industry investments in AI computing, noting the company expects to grow its semiconductor equipment business over 20% this calendar year.

Management highlighted their ongoing commitment to expanding industrial capacity to meet surging technical requirements of next-generation chips. CFO Brice Hill stated the company has nearly doubled its system manufacturing capability, strengthened its supply chain and increased inventories in preparation for market growth. Applied Materials issued bullish guidance for the second quarter of 2026, forecasting revenue between $7.15 billion and $8.15 billion, well above the $7 billion consensus and signaling continued momentum in the semiconductor capital equipment market.