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Lower sales hit Applied Materials 3Q net income

SANTA CLARA, Calif. (AP) -- Chip-making equipment company Applied Materials said Thursday its net income sank in the third quarter as sales weakened, and it forecast disappointing results for the fiscal fourth quarter.

Applied Materials also said company President Gary Dickerson will replace Michael Splinter as CEO on Sept. 1. Splinter, 62, has been CEO since 2003 and chairman since 2009, and he will become executive chairman of the company. Dickerson, 56, will remain president of the company. He was the CEO of Varian Semiconductor Equipment Associates when Applied Materials bought Varian in 2011.

Applied Materials Inc. said its net income fell 23 percent in quarter ended July 28. The company said it earned $168 million, or 14 cents per share, down from $218 million, or 17 cents per share, a year ago. Excluding one-time items Applied Materials said its net income totaled 18 cents per share. Revenue fell 16 percent, to $1.98 billion from $2.34 billion.

Analysts were expecting adjusted net income of 19 cents per share and $2.06 billion in revenue, according to FactSet.

Shares of Applied Materials fell 2.6 percent to $15.32 on Thursday and lost 32 cents, or 2.1 percent, to $15 in aftermarket trading.

Revenue from the silicon systems group business fell 18 percent to $1.27 billion and revenue from the applied global service unit decreased 14 percent to $497 million. Revenue from Applied Materials' display business rose 13 percent to $161 million.

The company said it took $2 billion in orders, which was less than it received in the second quarter.

Applied Materials is forecasting adjusted net income of 16 to 20 cents per share for the current quarter, and said sales will be about the same as the $1.98 billion it reported in the third quarter.

Analysts were expecting net income of 21 cents per share and $2.15 billion in revenue on average.