Applied Materials Inc (AMAT) saw its stock price plummet by 5.04% during intraday trading on Thursday, underperforming the broader technology equipment sector.

The decline appears driven by multiple factors. Broader market sentiment was negatively impacted by escalating geopolitical tensions, particularly renewed concerns surrounding the Iran war and its potential effects on oil prices and global stability. This created a general risk-off environment for equities. Additionally, there were indications of broader tech sector and ETF outflows, alongside profit-taking in high-beta technology stocks, which applied near-term pressure on AMAT shares.

Company-specific risks also contributed to investor caution. Applied Materials faces ongoing regulatory scrutiny, having recently incurred a significant penalty for past illegal semiconductor equipment exports to China. Furthermore, tightened U.S. export controls on semiconductor equipment sales to China are projected to reduce the company's fiscal year 2026 revenue by a substantial amount. These headwinds offset the company's recent strong financial performance, which included surpassing quarterly estimates and increasing its dividend.