ASML Holding NV reported first-quarter orders that were almost a billion euros less than expected and warned it doesn’t know how to quantify the impact of recent tariff announcements that are threatening to upend the semiconductor industry.
The Dutch company, which counts Taiwan Semiconductor Manufacturing Co. and Intel Corp. among its biggest customers, reported bookings of €3.94 billion . Analysts on average expected €4.82 billion, according to data compiled by Bloomberg. ASML said that order intake is a “lumpy” metric and doesn’t appropriately reflect its business momentum.
ASML’s shares fell 5.1% to €574.60 at 11:15 a.m. in Amsterdam on Wednesday, after earlier dropping as much as 7.6%, amid a broad selloff in chip stocks. ASML shares have declined about 37% in the past 12 months.
“The recent tariff announcements have increased uncertainty in the macro environment and the situation will remain dynamic for a while,” ASML’s Chief Executive Officer Christophe Fouquet said in a statement on Wednesday.
ASML is the sole producer of cutting-edge lithography machines used by semiconductor companies to make advanced chips for various products including Apple Inc.’s smartphones and Nvidia Corp.’s artificial intelligence accelerators.
The company has benefited from an artificial intelligence boom that has seen tech giants invest billions of dollars in chips and data centers to power the emerging technology. This has allowed ASML to project revenue ranging between €44 billion and €60 billion in 2030. But concern over a potential slowdown in AI demand has intensified after disappointing outlooks from some chipmakers and analyst warnings, compounded by looming US tariffs.
ASML outlined various ways US tariffs could impact the business, including additional charges on shipments of new systems, tools and parts imported into the country. Another possible risk is other countries “imposing tariffs on things that are being shipped from the United States into these countries,” Chief Financial Officer Roger Dassen said in a video accompanying the results.
The company said it has no plans to move more production to the US to limit the exposure of potential tariffs.
“We are already a big player in the United States and we build our presence where the capabilities are,” Dassen said in a call with reporters. “Most of the final assembly of what we do happens here in the Netherlands” because it’s where the capability and a lot of the supply chain is. “That is our plan,” he said.
Dassen added that it would be appropriate to pass on a “significant part” of the tariffs imposed on ASML to the “next layer in the value chain,” referring to customers who buy its chipmaking machines. The tariff burden should be allocated fairly, he said, meaning those importing to the US would bear the “lion’s share.”
ASML’s first-quarter results come two weeks after Trump announced tariffs on all exporters to the US, which sparked a selloff in stocks on fears of an economic downturn, weakening consumer demand and uncertainty over an escalating trade war. Analysts had warned that the move would impact chip demand and, in turn, the investment plans of ASML’s clients.
Last week the Trump administration exempted certain products such as smartphones, computers and machines used to make semiconductors from its so-called reciprocal tariffs. It excluded these products from the 125% tariff on China and the president’s baseline 10% global tariff on nearly all other countries.
But on Monday, the US Commerce Department said it had begun investigating the impact on US national security of “imports of semiconductors and semiconductor manufacturing equipment” as a precursor to imposing tariffs.
The company’s extreme ultraviolet lithography or EUV machines accounted for €1.2 billion of net bookings in the quarter.
China made up 27% of ASML’s net system sales, making it the company’s second-biggest market during the quarter. While that’s the same contribution from the preceding three months, it’s a drop from the 2024 average of 41%.
The US government has banned exports of advanced semiconductor technologies to China to curb the development of Beijing’s domestic chip industry and in turn its AI and military capabilities. ASML has never been permitted to sell its EUV machines to China because of US-led curbs and the Dutch government also restricted exports of the second-most-sophisticated machines — immersion deep ultraviolet lithography systems, or DUV — after pressure from the Biden administration.
Despite the growing number of restrictions, ASML benefited from strong demand from China last year as chipmakers there bought up older kit used to make more mature types of semiconductors.
“China demand is still strong,” Dassen said. The company now expects the Asian nation to account for slightly over 25% of net system sales in the year.
Chip stocks more broadly slumped after President Donald Trump on Tuesday barred Nvidia from selling its H20 chip to China in new rules aimed at thwarting Beijing’s supercomputing capabilities, the company said in a filing. Nvidia shares slid about 6% in late trading, leading to a broad selloff in Asian semiconductor stocks.
Fouquet, in the statement, said the firm’s “conversations so far” with customers support its expectation that 2025 and 2026 will be growth years, driven by AI investments.
ASML forecast that if the AI demand continues to be strong and its customers are capable of adding capacity, it had the opportunity to meet the upper range of its 2025 total net sales guidance of between €30 billion and €35 billion. But it said uncertainty with some of its customers could take it to the lower end of the range.
The first quarter orders “disappointed” and the tariff uncertainty is clearly “clouding” the outlook, Citi analyst Andrew Gardiner said in a note, but pointed to ASML’s reiterated full-year forecast and expectations of further growth in 2026.
Barclays analyst Simon Coles said that ASML would need €3 billion to €5 billion of orders each quarter for the next three to five quarters to hit consensus expectations. “This seems manageable but our worry is two major customers are unlikely to be ordering significantly any time soon,” he said.
This article was generated from an automated news agency feed without modifications to text.
