Applied Materials retreated sharply during intraday trading as investors engaged in a classic sell-the-news reaction following the company’s fiscal fourth-quarter earnings release. Despite delivering record top- and bottom-line figures and guiding next-quarter revenue and earnings above Wall Street consensus, the strong results were overshadowed by valuation concerns and cautious analyst commentary across the semiconductor capital equipment sector.

Management commentary during the earnings call highlighted that while artificial intelligence infrastructure demand across leading-edge logic, memory, and advanced packaging remains solid, cleanroom space and component availability at customer fabrication facilities are acting as near-term…