Applied Materials (Nasdaq: AMAT), the biggest maker of gear and machines used to manufacture semiconductors, said it will boost its quarterly dividend by 17% to 7 cents a share from 6 cents.

Last month, the company said it posted a first-quarter profit after its revenue surged 39%.

California-based Applied Materials last raised its dividend in March 2007.

Factoring in the new dividend, Applied Materials shares will yield about 1.95%.

Applied Materials provided shareholders with another round of good news by saying it will repurchase $2 billion worth of its own stock over the next three years.

The company had 1.34 billion shares outstanding at the end of January.

The new dividend is payable on June 16th to shareholders of record on May 26th.