October 16, 2024 – On Tuesday, leading photolithography machine manufacturer ASML predicted lower than expected sales and orders for 2025, citing persistent weakness in certain segments of the semiconductor market. This announcement triggered a significant drop in the company’s share price, resulting in the largest single-day decline since 1998.
Despite a robust demand for chips related to artificial intelligence, ASML indicated that other parts of the semiconductor market have remained in a slump for longer than anticipated. Consequently, companies manufacturing logic chips are postponing orders, while those producing memory chips are only planning for “limited” increases in new capacity.
ASML, Europe’s largest technology company and a prominent supplier of chip-making equipment, counts major players such as TSMC, Intel, Samsung, Micron, and SK Hynix as its customers.
The company released its quarterly financial results a day earlier on its website, which a spokesperson attributed to a “technical error.” In a statement, Chief Executive Officer Christophe Fouquet stated, “We expect total net sales for 2025 to be between 30 billion and 35 billion euros, in the lower half of our previous forecast range.” He added that the weakness in the chip market “is expected to persist into 2025, leading to caution among our customers.”
Trading of the company’s shares was halted multiple times in Amsterdam, eventually closing down 16% at 668.10 euros.
It’s worth noting that ASML’s third-quarter financial report showed a net profit of 2.1 billion euros and sales of 7.5 billion euros, slightly above analysts’ expectations. However, the company’s orders for the quarter stood at 2.6 billion euros, significantly below the anticipated range of 4 billion to 6 billion euros.
Remarkably, ASML’s sales to China reached a record high of 2.79 billion euros during the quarter, accounting for 47% of its total sales.
