Prime Highlights:
ASML’s fourth-quarter net bookings surged 169% to 7.09 billion euros, surpassing analyst expectations.
Net sales reached 9.26 billion euros, exceeding the forecast of 9.07 billion euros. Net profit came in at 2.69 billion euros, slightly ahead of expectations.
Despite concerns over AI spending, ASML’s advanced extreme ultraviolet (EUV) machines saw strong demand, contributing 3 billion euros to bookings.
Key Background:
Dutch semiconductor giant ASML reported a significant increase in its fourth-quarter net bookings, reinforcing strong demand for its advanced chipmaking tools despite concerns surrounding the potential impact of low-cost AI models on the semiconductor market. ASML’s net bookings reached 7.09 billion euros, a 169% surge from the previous quarter, significantly surpassing analysts’ expectations of 3.99 billion euros.
ASML’s quarterly net sales stood at 9.26 billion euros, exceeding the forecasted 9.07 billion euros, while net profit came in at 2.69 billion euros, slightly above the 2.64 billion euros expected. The company also reiterated its 2025 full-year sales outlook of between 30 billion and 35 billion euros, while reporting a backlog of around 36 billion euros as of the end of 2024.
Shares of ASML jumped by over 11% before slightly retreating to a 9% increase by mid-morning trading in London. The rally comes despite earlier concerns stemming from the launch of Chinese startup DeepSeek’s R1 reasoning model, which claims to undercut OpenAI’s offerings in both cost and performance. This prompted fears of reduced AI spending, particularly on high-precision equipment like ASML’s extreme ultraviolet (EUV) machines, which are crucial for advanced microchip production.
ASML CEO Christophe Fouquet addressed these concerns, asserting that the rise of low-cost AI models could actually stimulate more demand for semiconductors. He emphasized that more affordable AI could lead to increased applications, thereby driving long-term demand for chips. The company has not yet received customer inquiries related to DeepSeek’s impact on chip demand, according to Fouquet.
While ASML acknowledged a potential slowdown in demand from China due to prior stockpiling in anticipation of U.S. export restrictions, it expects a more balanced demand pattern in 2025. Overall, analysts remain optimistic about ASML’s future prospects, with Morningstar’s Michael Field reiterating its position as a top AI investment pick in Europe.
