Applied Materials (AMAT) Reaches $2.525B Settlement with DoD Over Illicit Semiconductor Equipment Exports to SMIC

The U.S. Department of Commerce's Bureau of Industry and Security (BIS) announced on February 11, 2026, a $2.525 billion settlement with Applied Materials (AMAT-US) for violations of U.S. export controls, including alleged exports or attempted exports of at least $1.26 billion worth of semiconductor equipment to SMIC (00981-CN) between 2020 and 2023 under 56 different provisions. The company issued a statement expressing satisfaction with the agreement. The administration's strict export restrictions on China have promptedApplied Materials to issue sales outlooks that reflect potential impacts of these policies, with the settlement being the second-largest fine in BIS history to date.