Adverse economic winds dent Applied’s profits

Equipment maker Applied Materials turned in its fourth quarter.

It turned in net sales of $2.18 billion for the quarter, with a net income amounting to $456 million. That compares against the same period last year, when it turned over $2.89 billion and had a net profit of $468 million.

Applied said its Silicon System Group orders amounted to $925 million, a drop of 25 percent compared to the same period last year. It attributed the drop to weaker demand for flash memory and DRAM.  Breaking down these orders, foundry equipment amounted to 46 percent, logic and other equipment 32 percent, flash 15 percent and DRAM seven percent.

The DRAM companies have not had a brilliant year.

Its display orders fell by 91 percent, with the shortfall because of lower demand for TV and mobile display equipment.  Applied made a gross margin of 39 percent, a drop from 42.5 percent in its third quarter.

Mike Splinter, chairman and CEO of Applied, said that it had a record year but that the company expected the first half of fiscal 2012 to be affected by what he described as a “challenging economic environment”.