ASML orders miss forecast as demand for most-advanced machines decreases
Dutch tech giant ASML Holding NV posted new orders that fell short of analyst expectations, hurt by a downturn in demand for its most advanced machines from the chipmaking industry.
Bookings at Europe’s most valuable technology firm were 3.6 billion euros (US$3.8 billion) in the first quarter of the year, compared with a record 9.19 billion euros in the previous quarter.
Net profit came in at 1.2 billion euros in the first quarter, compared with 2 billion euros in the fourth quarter of last year.
ASML, the world’s sole producer of equipment needed to make the most advanced chips, saw a slump in demand for its top-end extreme ultraviolet (EUV) machines, with orders plunging to 656 million euros in the period from 5.6 billion euros in the previous quarter.
Overall sales in the first quarter came in at 5.3 billion euros, lower than the 7.2 billion euros from the previous quarter, but in the range the company had forecast. The company is expecting sales of between 5.7 billion euros and 6.2 billion euros in the second quarter before demand starts to pick up.
“Our outlook for the full year 2024 is unchanged, with the second half of the year expected to be stronger than the first half, in line with the industry’s continued recovery from the downturn,” ASML chief executive officer Peter Wennink said in a statement yesterday. “We see 2024 as a transition year.”
ASML chief business officer Christophe Fouquet is to take over as CEO when Wennink retires later this month.
ASML chief financial officer Roger Dassen said investors should bear in mind that combined orders over the past two quarters amounted to 13 billion euros — “a pretty significant number.”
“I think it’s pretty clear that the industry is in its upturn,” Dassen said in the statement. “We will see recovery for the industry in 2024 and that we are building up for a stronger year in 2025.”
While the company was hit by weakness in Taiwan and the US — ASML’s biggest market for EUV machines — its China business remained relatively resilient. Sales there were 1.9 billion euros in the first quarter, down from 2.2 billion euros in the previous period, while the percentage of sales to China rose to 49 percent from 39 percent in the fourth quarter of last year.
The semiconductor industry has become a geopolitical battleground as the West seeks to restrict China’s access over fears the chips could be used for advanced weaponry, with Dutch and US export rules targeting the Veldhoven, Netherlands-based company’s ability to sell cuttingedge equipment to China.
ASML has never been able to sell its EUV machines to China amid pressure from the US government. The company expects as much as 15 percent of China sales this year to be affected by the new export control measures.