ASML gains over 3.5% in pre-market trading after the company’s Q3 results exceeded investor expectations.
The excitement across the semiconductor sector is driven primarily by orders of €5.4 billion, above the forecast of €4.9 billion, confirming strong investment demand in artificial intelligence infrastructure. The Dutch company, as the only producer of EUV lithography machines needed for the most advanced AI chips, is one of the biggest beneficiaries of the sector’s investment boom.
Source: xStation5
CEO Christophe Fouquet highlighted the ongoing positive momentum in AI investments, extending to an increasing number of customers. The company plans to grow annual revenue to as much as €60 billion by 2030, up from €28.3 billion in 2024, and double its workforce near its headquarters in Veldhoven.
On the risk side, ASML faces primarily geopolitical challenges, including restrictions on sales to China resulting from U.S. actions targeting the Chinese semiconductor sector. The company is also preparing for possible supply disruptions due to China’s recent rare earth export restrictions. Considering ASML’s growing exposure to China, potential limits on AI development due to trade/technology tensions could impact the company’s projected revenue growth.
Key Q3 2025 Results
- New orders: €5.40B (↓2.6% q/q), above forecast (€4.89B).
- Net sales: €7.52B (↓2.3% q/q), below forecast (€7.71B).
- System sales: €5.55B (↓6.3% q/q), slightly below expectations (€5.66B).
- Total systems sold: 72 (below forecast 98.5); most units: ArFi (38).
- China’s share of system sales: 42%, up from 27% in Q2.
- Service & field operations sales: €1.96B, in line with forecast (€2.0B).
- Gross margin: 51.6%, slightly above forecast (51.4%).
- R&D expenses: €1.11B, below expectations (€1.2B).
- Operating income: €2.47B, above forecast (€2.43B).
- Operating margin: 32.8%, above forecast (31.3%).
- Net income: €2.13B (↓7.2% q/q), slightly above forecast (€2.07B).
- Cash and equivalents: €5.13B (↓29% q/q), below forecast (€5.91B).
- Interim dividend: €1.60 per share.
Q4 2025 Outlook
- Net sales: €9.2–9.8B (forecast: €9.23B).
- Gross margin: 51%–53% (forecast: 50.7%).
- R&D expenses: ~€1.2B (forecast: €1.25B).
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