ASML, the world’s top computer chip equipment supplier, reported strong Q3 orders, driven by the global Artificial Intelligence (AI) investment rush, even as it warned of a significant drop in demand from China next year.
Wins and AI Momentum
- Net Bookings Beat: Q3 net bookings, the most closely watched figure, hit 5.40 billion euros ($6.27 billion), narrowly beating analyst estimates of 5.36 billion euros.
- The AI Driver: CEO Christophe Fouquet highlighted “continued positive momentum around investments in AI,” boosting demand for both advanced logic chips (used in AI datacenters and smartphones) and advanced memory chips.
- Market Reaction: ASML shares were up 3.2% to 873.80 euros following the results, continuing a significant surge since September.
- Mega Deal Context: This surge comes as AI firms like OpenAI announce massive data center capacity plans (valued at $1 trillion or more), driving demand for chips that ASML’s equipment is essential for producing.
China Outlook Dims
- Projected Decline: ASML expects Chinese sales to fall “significantly” next year, characterizing the decline as a “normalization” rather than stockpiling due to trade tensions.
- Context of the Drop: China had been a major market, making up nearly half of company sales in 2024 and a third so far in 2025.
- Geopolitical Headwinds: The company remains subject to U.S.-led export restrictions which prevent it from selling its most advanced tools (lithography equipment) in China.
Forward Guidance (2026 Focus)
- 2026 Sales Floor: ASML projected that sales will be at worst, flat in 2026 compared to 2025’s estimated $37.82 billion (32.5 billion euros).
- Analyst View: Analysts are now shifting their focus past the expected 2026 plateau to the company’s potential for growth in 2027.
- Key Clients: ASML’s lithography tools are critical for major global chipmakers, including TSMC (which manufactures most AI chips for Nvidia), Intel, Samsung, and SK Hynix.
Would you like me to analyze how the current ASML stock price compares to the price mentioned in the article, or perhaps look into the details of the OpenAI $1 trillion data center plans?
