Jamie Spencer
ASML (NASDAQ: ASML) delivered a blowout earnings report, posting a 169% surge in Q4 net bookings to $7.09 billion—nearly double analyst predictions. Despite concerns surrounding Chinese AI startup DeepSeek, which recently shook the semiconductor sector with its low-cost model, investors remain confident in the Dutch chipmaking giant. ASML stock jumped 6% on the news, signaling Wall Street’s continued support.
CEO Remains Confident Despite AI Disruption
CEO Christophe Fouquet dismissed worries that cheaper AI models could hurt ASML’s business. Instead, he sees increased AI accessibility as a net positive:
“More AI means more chips, not fewer.”
According to Fouquet, ASML’s advanced semiconductor technology will remain crucial as the industry scales AI capabilities across data centers, smartphones, and other sectors.
Geopolitical Risks and Revenue Shifts
While ASML is thriving, risks are mounting:
- U.S.-China trade tensions: ASML expects China’s revenue share to drop from 41% in 2024 to 20% in 2025 due to tightening U.S. trade restrictions.
- AI training shifts: The rise of cheaper AI models could reduce demand for ASML’s high-end extreme ultraviolet (EUV) lithography machines, which accounted for $3 billion in bookings last quarter.
ASML Bets on Long-Term AI Growth
Despite uncertainties, ASML remains bullish. Fouquet believes AI’s long-term expansion will drive chip demand across multiple industries. The company has a massive $36 billion backlog and expects $30-$35 billion in revenue for 2025.
Analysts like Morningstar’s Michael Field see ASML as undervalued, setting a fair price of $850 per share—well above current levels.
The Big Question: Can ASML Stay Ahead?
As AI reshapes the semiconductor industry, ASML must navigate evolving tech trends and geopolitical challenges while maintaining its position as a critical player in chip manufacturing. With strong bookings and a growing AI-driven market, the company is betting big on the future.
