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Applied Materials

(AMAT) - Get Applied Materials, Inc. Report

, supplier to the volatile semiconductor industry, reported Tuesday that its earnings had risen sevenfold, exceeding Wall Street's forecasts despite formidable odds.

The company said demand for its products worldwide was stronger than expected in the quarter.

The Santa Clara, Calif.-based company also announced a 2-for-1 stock split.

For the first quarter ended Jan. 30, Applied Materials reported net income of $328 million, or 80 cents a diluted share. In the comparable 1999 quarter, net income totaled $46 million, or 12 cents a diluted share.

Analysts surveyed by

First Call/Thomson Financial

had predicted that earnings would average 77 cents a share in the latest quarter.

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Revenues more than doubled, to $1.67 billion in the latest quarter, from $742 million a year earlier.

Applied Materials shares soared to 171 in after-hours trading. They had gained 5 7/16, or 3.38% before the announcement, closing regular trading at 166 1/2.

The company reported new orders of $2.36 billion in the first quarter, up 12.5% from the previous quarter. North America and Taiwan each placed a quarter of the new orders, with Japan, Korea, Europe, Southeast Asia and China rounding out the list.

Applied Materials provides supplies and services to companies that create computer chips, placing it in an industry swayed by dangers real and imagined. Those dangers range from earthquakes in Taiwan -- perceived as hurting semiconductor manufacturers -- to


delivery schedule for its Windows 2000 operating system, viewed as driving computer sales growth.

The first quarter included the last two months of 1999, when companies were reluctant to upgrade computer systems until problems from the Year 2000 date change were resolved.

Just hours before the company reported its earnings,

Lehman Brothers

released a note brushing aside rumors that the company could miss expectations because of failure to implement a new software system.

The firm, which rates Applied Materials shares buy and has not done underwriting for the company, had estimated new orders of $1.85 billion, noting a so-called whisper number, or Wall Street rumor, of $2 billion.