Applied Materials Inc. suffered the worst single-day stock decline in five years after giving a disappointing sales and profit forecast, renewing concerns that the US trade dispute with China is weighing on demand.

Analysts wonder if China’s recent “overspending” on chip equipment is coming to a halt — and if the company is losing market share to rivals.

Beijing E-Town Semiconductor Technologies , a semiconductor equipment firm backed by Beijing's government, on Wednesday said it has sued U.S. chip equipment supplier Applied Materials over alleged trade secrets infringement.

Applied Materials (AMAT) stock falls after the company issued guidance that fell short of Wall Street's expectations. Warren Buffett's Berkshire Hathaway (BRK-B, BRK-A) added to its stakes in homebuilder stocks Lennar (LEN) and DR Horton (DHI).

Applied Materials forecast fourth-quarter revenue and profit below estimates on Thursday, citing weak demand in China and erratic orders from customers facing uncertainty because of tariffs, sending its shares down nearly 13 per cent in extended trading.

The lower guidance prompted a rapid sell-off of Applied Material’s shares, and its stock fell more than 13% in extended trading. Following that decline, the company’s stock is now up just 15% in the year to date, slightly ahead of the S&P 500 Index, which has gained just over 10% so far this year.

Applied Materials was the worst-performing stock in the S&P 500 Friday, a day after the semiconductor equipment manufacturer gave weaker-than-expected guidance as global economic and tariff worries impact its business,

Applied Materials reported third-quarter revenue of $7.3 billion, beating analyst estimates of $7.22 billion. The chip equipment manufacturer reported third-quarter adjusted earnings of $2.48 per share, beating analyst estimates of $2.36 per share, according to Benzinga Pro.