Applied Materials Inc., the largest US maker of chipmaking machinery, slid in late trading following a report that it faces a US criminal investigation for violating export restrictions to China.

The company is being probed by the Justice Department over dealings with China’s biggest chipmaker, Semiconductor Manufacturing International Corp., according to Reuters. The report overshadowed generally upbeat quarterly results on Thursday. The company posted earnings and gave a forecast that both topped analysts’ estimates.

Shares of Applied Materials, based in Santa Clara, California, fell as much as 7% in extended trading.

“Applied Materials first disclosed in October 2022 that it received a subpoena from the US Attorney’s Office for the District of Massachusetts requesting information relating to certain China customer shipments,” the company said in an emailed statement. “The company is cooperating with the government and remains committed to compliance with global laws, including export controls and trade regulations.”

The company and its peers are operating under increasingly strict rules imposed by Washington on exports of chip technology to China. The US has argued such rules are needed to protect national security and requires companies to seek licenses to send certain types of machines or have dealings with particular companies there.

(Updates with company response.)