New York, Feb 6, 2026, 12:35 EST — Regular session
- Shares of Applied Materials climbed 5.7%, hitting $321.20 by midday trading
- Citi raised its price target to $400 and maintained a Buy rating ahead of the Feb. 12 earnings report
- Traders are focused on guidance regarding chip-factory investment and demand from China
Shares of Applied Materials jumped 5.7% to hit $321.20 on Friday, leading the charge among U.S. chip-equipment stocks in midday trading.
The surge comes as investors untangle the “picks-and-shovels” angle from the wider AI frenzy — a divide that’s grown messier this week amid Big Tech’s rising capex. “The market is no longer tolerating spending for spending’s sake,” said Mark Hawtin, head of global equities at Liontrust. Reuters
A new analyst note gave shares a boost. Citi’s Atif Malik bumped the price target on Applied Materials to $400 from $250, maintaining a Buy rating. He cited expectations for earnings to beat consensus thanks to upward revisions in spending from leading foundry and memory-chip firms.
Chip stocks spearheaded Wall Street’s bounce back following a tech-driven selloff earlier this week, according to a Reuters report. “The problem is we have to differentiate between potentially bad and certainly bad,” said Kristina Hooper, chief market strategist at Man Group. Reuters
Peers followed suit. Lam Research jumped 7.3%, KLA climbed 7.8%, and ASML was up 4.3% by midday.
Overnight, Reuters reported that Taiwan’s Winbond Electronics snapped up machinery from Applied Materials South EastAsia for T$7.45 billion, marking another sign of steady equipment orders fueled by memory demand.
Applied plans to release its fiscal first-quarter results on Feb. 12, with an earnings call scheduled for 4:30 p.m. ET that day.
Investors will be watching closely for any shift in the company’s outlook on wafer-fab equipment spending — the gear chipmakers use to build and upgrade fabs — and how that might impact the back half of the year, when the spending cycle can shift abruptly.
China remains a major concern. Applied Materials flagged that stricter U.S. export rules might limit its access to segments of the Chinese market, despite AI-driven memory demand bolstering some spending areas.
Tokyo Electron boosted its annual net profit forecast by 12.7% on Friday, signaling some stabilization in the equipment cycle in Asia. Yet in the U.S., investors remain wary, ready to sell off any signs of costly expansion that lacks immediate returns.
Applied Materials’ next key moment comes on Feb. 12, when it issues guidance. Investors will be watching closely to see if management hints at more stable customer demand through mid-2026 or warns of further uncertainty.
