Europe’s largest chipmaking equipment manufacturer announced its second quarter earnings data earlier today and albeit toppling both of its EPS and revenue targets its share price slumped by over 7% as the company issued a dire growth warning for 2026.
The Netherlands based company reported sales of 7.69 billion euros for the second quarter of 2025, up from 6.24 billion euros a year earlier. The figure is above analysts’ forecasts and at the top of company guidance.
Above market expectations was also the net profit metric which grew to 2.29 billion euros from 1.58 billion euros a year earlier, and likewise, gross profit came in at 4.13 billion euros, generating a 53.7% margin that beat both consensus and company guidance.
Officials warned sales might not grow at all next year and rating agencies moved swiftly to downgrade the valuation of the microchip equipment maker and slashed price targets to below 700 euros per share, reflecting the company’s cautious outlook.
CEO Christophe Fouquet in a statement noted that AI customers’ fundamentals remain strong and sighted that macroeconomic and geopolitical developments are expected to negatively impact growth.
ASML now expects sales to grow around 15% to roughly 32.50 billion euros this year compared with a previous guidance range of 30 billion to 35 billion euros.
However, analysts noted that should the European commission expel export controls on China this could lift bookings and demand for ASML’s services, supporting growth.
Nvidia, the has been granted a sales permission of its H20 chips to China by the US administration yesterday.
Technical Analysis
ASML Chart – ASML drops by over 7% after the chip equipment makers issues cautious outlook warning
Resistance: 710 (R1), 750 (R2), 800 (R3)
Support: 635 (S1), 575 (S2), 510 (S3)
