Concerns over US-China trade tensions were raised when Applied Materials cut its Q4 guidance, citing weak China demand and shipment delays.

The biggest American manufacturer of chipmaking equipment, Applied Materials Inc., fell in late trading due to weak sales and profit projections, confirming worries that demand is being negatively impacted by the US trade war with China. According to a statement released by the firm on Thursday, revenue for the fiscal fourth quarter will be around $6.7 billion.

On average, analysts had projected $7.32 billion. Excluding certain things, the profit will be around $2.11 per share, as opposed to the projected $2.38. In an interview, CEO Gary Dickerson stated that the company's Chinese clientele is showing decreased demand. According to him, there are additional difficulties in getting approval to export technology to that nation.

Additionally, a number of major clients are postponing orders as a result of drawn-out tariff negotiations and other economic challenges. According to Dickerson, it only adds a degree of uncertainty. Shares of Applied Materials fell as much as 12% as a result of the outlook. Ahead of the news, they closed Thursday at $188.24, up 16% so far this year.

The projections from Applied Materials serve as a gauge for future demand because those manufacturers place their orders for equipment well in advance of the commencement of production. Some of the largest names in the semiconductor business, including Samsung Electronics Co., Taiwan Semiconductor Manufacturing Co., and Intel Corp., are among Applied Materials' clients.