Applied Materials Crime Probe

Plus, Gap's sales better than feared.

Today is Friday, November 17, 2023.

The Early Bird Index today is 59.07.

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Applied Materials Crime Probe

Strong financial earnings results couldn’t stop Applied Materials (Nasdaq: AMAT) from falling 7.60% in after-hours trading on Thursday due to a report alleging a criminal investigation against the semiconductor maker.

Financials: Applied Materials reported earnings of $2.12 per share in the past quarter and revenue of $6.72 billion; both were better than expected.

Powering the Story: Applied Materials dropped due to a report from Reuters that said the Justice Department is investigating the company for allegedly sending hundreds of millions of dollars of equipment to the China-based chipmaker SMIC without export licenses. This act would potentially be in violation of export restrictions to China.

Response: Applied Materials said that it is “cooperating with the government and remains committed to compliance and global laws.”

Final Thoughts: The company was up 60% this year, hitting a 2023 high on Thursday before the report. The financials look good, but this criminal probe (uh-oh) looks nasty for Applied Materials.

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Notable Earnings Today: BJ's Wholesale (NYSE: BJ), Spectrum Brands (NYSE: SPB), Twist Bioscience (Nasdaq: TWST), Yatra Online (Nasdaq: YTRA), CI&T (NYSE: CINT), Destination XL Group (Nasdaq: DXLG), Atkore (NYSE: ATKR).

Notable IPOs Today: Richtech Robotics Inc. Class B Common Stock (Nasdaq: RR).

Notable Equity Crowdfunding Campaigns Ending Today: Stoner's Haven (Mainvest), Q Med Innovations (Netcapital), ReDisco Corporation, Inc. (TruCrowd), SKOG Haus Coffee & Tea (Mainvest).

Notable Economic Events Today: Building Permits (8:30 a.m. ET), Housing Starts (8:30 a.m. ET).

Gap's Sales Better Than Feared

Gap (NYSE: GPS) jumped 17.12% in after-hours trading on Thursday after the retail company posted strong financial results.

Financials: Gap reported earnings of 59 cents per share in the past quarter and revenue of $3.8 billion; both were better than expected.

Details: Sales were better than expected, but they were still down in every brand. Think of these results as Gap’s best “down” quarter in recent years.

Yes, But: The company grew its margins and reaffirmed its full-year revenue outlook. Good for investors!

Final Thoughts: Gap, up 20% this year, is benefiting from an environment where consumers are looking to save money for fashion. Can Gap continue to stage this retail comeback?

ChargePoint’s Warning Worries Investors

Electric vehicle charging company ChargePoint (NYSE: CHPT) plummeted 30.04% in after-hours trading - Yikes! - after posting preliminary financial results that were lower than anticipated.

Details: ChargePoint also announced Thursday that it named Rick Wilmer as its new CEO.

Powering the Story: Wilmer blamed the financials on delivery delays and other macroeconomic conditions.

Final Thoughts: ChargePoint, down a whopping 65% this year, is struggling due to lower demand in the EV market. This has been an ongoing problem. No surprises here for investors.

Trends to Watch

Hey Alexa, Get Me a Car: Hyundai to Be First Automaker to Sell New Cars on Amazon (Wall Street Journal)

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