(Bloomberg) -- Applied Materials Inc. expects sales to decline in the current quarter as it grapples with a memory-chip slump, though the drop won’t be as sharp as some analysts had feared.

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Fiscal third-quarter sales will be about $6.15 billion, the company said in a statement Thursday, compared with $6.52 billion a year earlier. Analysts had estimated $5.97 billion.

Makers of memory chips are struggling with a historic glut of inventory, forcing them to cut spending on equipment upgrades and new factories. That’s hurt orders for companies like Applied Materials, threatening a pandemic-era growth run. The Santa Clara, California-based company, the biggest maker of semiconductor-manufacturing machinery, said that memory customers’ spending is tracking at its lowest level in more than a decade.

“Certainly there’s some challenging macro conditions,” Chief Executive Officer Gary Dickerson said in an interview.

Still, Applied Materials is benefiting from the rush to make more chips for cars and factory equipment. That’s helping offset a slowdown in orders for machines that produce components for smartphones and personal computers. Consumer demand for those devices hasn’t recovered, making semiconductor suppliers reluctant to invest in new equipment.

Applied Materials shares slipped 1% in late trading after the results were released. They earlier closed at $129.92 in New York, leaving them up 33% this year.

Excluding some items, earnings will be $1.56 to $1.92 a share in the current quarter, versus a projection of $1.63 a share.

Dickerson said demand for machines needed to make chips for the automotive and industrial markets “remains pretty robust.” That’s helping cushion slower spending on gear used for memory chips in particular.