Applied Materials, Inc. released its third quarter results for the 2019 fiscal year yesterday. Although the earnings report was better than expected, its management believes that the weak cycle of the memory chip has not yet reached the bottom.

According to the financial report of the Applied Materials, net sales in the third quarter were US$3.562 billion, down 14% from US$4.162 billion in the same period of last year; gross profit fell to US$1.557 billion from US$1.864 billion in the same period last year, with a gross margin of 43.7%. Net profit fell 44% year-on-year to $571 million.

According to Applied Materials, part of the reason for the slowdown in growth is due to the slowdown in capacity expansion in the flash memory industry. From the data point of view, Applied Materials’ sales to flash memory manufacturers fell to 24% from 39% a year ago.

Dan Durn, chief financial officer of Applied Materials, said: “I have seen some positive leading indicators for the future growth of memory chips, but don’t expect the market to recover this year.” In addition, Gary Dickerson, CEO of Applied Materials, pointed out in a telephone interview after the earnings report that it is estimated that the NAND market will pick up next year, and DRAM will follow NAND.