Applied Materials (AMAT) is heading into its fiscal third-quarter 2026 earnings report with its stock trading near a critical resistance level. The company will release its results after the market closes on August 13.

AMAT shares have rebounded from a July low of approximately $436 to a recent level of $548.34. Traders are closely monitoring whether this recovery can push through key resistance, while longer-term investors are weighing the broader outlook for semiconductor equipment demand.

AMAT Stock Tests Key Resistance

AMAT is approaching resistance at $554.94 after reclaiming positions above major moving averages near $532.09 and $538.35. The relative strength index (RSI) sits at approximately 61, indicating positive momentum without signaling overbought conditions.

The stock has established a trading range between roughly $511 and $550. A decisive move above $554.94 could open the door to technical targets near $582.85, $613.67, and $651.12, provided buyers maintain control following the earnings release.

Growth Outlook Remains Central

Applied Materials projects semiconductor equipment growth exceeding 30% in 2026. Management has identified AI data centers, advanced packaging, and new transistor architectures as the primary drivers of capital spending.

The company anticipates that leading-edge foundry logic, DRAM, and advanced packaging will account for nearly 80% of wafer fabrication equipment growth this year. Advanced packaging alone is expected to grow by more than 50% as chipmakers increasingly adopt chiplet-based designs.

Applied Materials is one of the world's largest semiconductor equipment suppliers, competing alongside companies such as ASML, Lam Research, Tokyo Electron, and KLA. Its outlook is widely viewed as a barometer for broader capital expenditure trends across the global chipmaking supply chain.

Valuation Under Scrutiny

Applied Materials previously posted record revenue of $7.91 billion, a result that helped underpin the stock's recent recovery. Strong forward guidance also restored investor demand for the shares after valuation concerns drove the price lower in July.

AMAT currently trades at roughly 43.8 times forward earnings. This valuation intensifies the focus on whether the company can sustain robust growth in AI-related equipment heading into fiscal 2027 and continue supporting elevated spending across key semiconductor markets.

AI Infrastructure Spending Underpins Demand

Demand for AI infrastructure continues to fuel spending among hyperscalers and semiconductor manufacturers. Chipmakers are expanding capacity for logic and DRAM production to support AI training and inference workloads.

Applied Materials also serves customers transitioning to Gate-All-Around transistor structures, the successor to FinFET architecture at the most advanced manufacturing nodes, as well as advanced packaging technologies. Government-backed semiconductor incentive programs, including the U.S. CHIPS and Science Act and comparable initiatives in Asia and Europe, have contributed to a multiyear buildout of fabrication capacity that underpins equipment demand.

Investors will be looking to the earnings report for updates on order trends, customer spending patterns, and whether AMAT can sustain its recovery above key support levels. The results will also offer a clearer picture of demand across memory, foundry, logic, and packaging markets worldwide.