According to Bloomberg, Applied Materials, a major U.S. chip equipment manufacturer, announced the launch of a global layoff plan, accounting for approximately 4% of its total employees and estimated to affect more than 1,400 people. The company stated that this move is to strengthen its operating structure and efficiency to face the challenges brought by market fluctuations and geopolitics.
According to the latest regulatory filing, Applied Materials will prepare expenses of approximately US$160 million to US$180 million, mainly for severance and related compensation. Most of the expenses will be booked in the fourth quarter of this fiscal year, and the overall plan is scheduled to be completed in the first quarter of fiscal year 2026. The company currently employs approximately 36,100 people and is one of the world's largest suppliers of semiconductor manufacturing equipment.
Applied Materials pointed out that the U.S. government’s recent further tightening of export regulations for China’s semiconductor equipment is expected to reduce the company’s 2026 revenue by approximately US$600 million. This move has affected its shipments and maintenance services in the Chinese market, and also forced the company to accelerate internal adjustments to ensure future growth momentum.
CEO Gary Dickerson mentioned in a letter to employees that the semiconductor industry still has huge growth potential, and the company is actively building a more flexible and productive organizational structure to meet long-term opportunities and maintain competitive advantages.
Analysts pointed out that the continued tightening of U.S. export policies has put major equipment manufacturers such as Applied Materials, Lam Research, and KLA under pressure. Despite short-term revenue pressure, equipment investment is still expected to pick up in the medium to long term as demand for AI chips, advanced packaging and high-bandwidth memory expands.
Applied Materials to Cut 4% of Global Staff After Sales Slow