Applied’s merger with TEL: Still a work in progress

By Jeff Dorsch, Contributing Editor

Applied Materials on Wednesday reported that its proposed merger with Tokyo Electron Ltd. (TEL) is still under way, without giving a deadline or expected date of conclusion.

President and CEO Gary Dickerson said the company is “making progress with regulators” and plans to “complete the merger as soon as possible.” He declined to elaborate on that point, on advice of its attorneys.

Applied and TEL teams are working together to fulfill “the strategic opportunity this merger creates,” Dickerson said.

For the fiscal first quarter ended January 25, Applied received orders of $2.27 billion, up 1 percent from the fourth fiscal quarter and down 1 percent from a year earlier. The company posted sales of $2.36 billion, an increase of 4 percent from Q4 and up 8 percent from a year ago. Net income was $338 million, up 21 percent from the previous year’s $279 million.

“Major technology inflections in semiconductor and display are creating new growth opportunities for Applied`s precision materials engineering products and services,” Dickerson said in a statement. “With focus and execution, we are gaining momentum toward our long-term strategic goals, and this progress will be accelerated by our planned merger with Tokyo Electron.”

Applied forecasts sales in the second fiscal quarter will be flat to up a couple of percentage points from Q1. Dickerson said memory chips will drive demand for equipment in the fiscal first half, and the second half will see growth from foundries placing orders for equipment to be used in producing devices with FinFETs.


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