ASML, a leading chip equipment maker, exceeded expectations in its fourth-quarter bookings, reaching 7.09 billion euros ($7.39 billion), compared to the forecasted 3.99 billion euros, driven by booming demand in the AI sector.
The surge in orders reassures investors about the future prospects of AI chips, despite a recent sell-off triggered by DeepSeek’s AI model, which requires less computing power than competing models.
ASML shares rose 7.5% to 695 euros, peaking at 722 euros during the trading day.
AI Boom and Impact on ASML’s Outlook:
CEO Christophe Fouquet expressed optimism, stating that AI has strengthened demand for ASML’s most advanced equipment.
DeepSeek’s AI model raised concerns over whether companies like Google, Microsoft, Meta, and Amazon would continue their heavy investments in AI chips. Despite this, Fouquet remains confident that as AI model costs decrease, demand for chips and advanced manufacturing tools will increase.
ASML reported a net income of 2.7 billion euros for the fourth quarter, surpassing analyst expectations. The company’s 2025 sales forecast remains between 30-35 billion euros, reflecting expected growth driven by the AI chip boom.
Market Position and Forecasts:
ASML’s largest customer, TSMC, remains a key player in the chip industry, manufacturing chips for firms like Nvidia and the aforementioned tech giants. Despite DeepSeek’s impact, the growth in AI-related demand for chips continues to drive TSMC’s capital expenditure.
ASML’s US market accounted for 28% of sales in Q4, with China following closely. The shift is due to TSMC’s Arizona expansion and Intel’s investments in ASML’s high-tech EUV tools.
However, ASML expects its China sales to decline to 20% of total sales in 2025 due to ongoing export restrictions imposed by the US and Dutch governments on national security grounds.
