Applied Materials forecasts upbeat fourth quarter

(Reuters) -Semiconductor equipment maker Applied Materials (NASDAQ:) forecast fourth-quarter results above market estimates on Thursday on strong demand from chipmakers setting up new manufacturing plants, sending its shares up 3% after the bell.

Governments across the globe have in the past year doled out billions of dollars in subsidies to boost domestic chip manufacturing, which benefited companies such as Applied Materials and KLA whose tools are essential in chip making.

The companies have also gained from China’s efforts to stock up on tools for making chips with legacy technologies after U.S. export control rules blocked sales of more advanced chipmaking technologies to the country.

Santa Clara, California-based Applied Materials expects revenue of $6.51 billion in the fourth quarter, plus or minus $400 million, compared with analysts’ average estimate of $5.86 billion, according to Refinitiv data.

It expects adjusted profit per share between $1.82 and $2.18, above market estimate of $1.61.