ASML Crushes Earnings, Surges 10% as AI Boom Fuels Record Bookings and Upbeat Outlook
2min read ASML Holding NV (NASDAQ: ASML) delivered a strong fourth-quarter earnings report, exceeding analyst expectations on both earnings per share (EPS) and revenue. The Dutch semiconductor equipment giant reported EPS of €6.85, surpassing the FactSet consensus estimate of €6.72. Revenue rose 28% year-over-year to €9.3 billion, topping the expected €9.1 billion. Net bookings for the quarter came in at €7.1 billion, significantly above the €5.7 billion projected by analysts, with €3.0 billion attributed to its crucial extreme ultraviolet (EUV) lithography systems. Following the report, ASML shares surged in pre-market trading, nearly recovering all losses from the prior sell-off triggered by concerns over DeepSeek's low-cost AI model.
Key performance metrics further underscored ASML’s strength in the semiconductor sector. The company posted a gross margin of 51.7%, exceeding estimates of 49.6%, and reported net system sales of €7.12 billion. Operating income reached €3.36 billion, surpassing the expected €3.09 billion, while net income jumped 30% quarter-over-quarter to €2.69 billion. ASML also significantly increased cash reserves, reporting €12.74 billion in cash and equivalents, up from €4.99 billion in the prior quarter. Despite a decline in revenue from China, which accounted for 27% of net system sales compared to 47% in the previous quarter, overall demand for ASML’s lithography machines remained robust, driven largely by AI-related demand.
Guidance for 2025 reaffirmed ASML’s optimistic outlook. The company expects full-year revenue between €30 billion and €35 billion, in line with analyst estimates of €33.22 billion, reflecting anticipated growth of 7-25% from 2024's €28.3 billion. Gross margin for the year is projected to range between 51% and 53%. For Q1 2025, ASML provided upside guidance, forecasting revenue between €7.5 billion and €8.0 billion, exceeding the consensus estimate of €7.21 billion, with gross margin expected in the range of 52%-53%.
A crucial component of ASML’s earnings report was management’s commentary on AI-driven demand. CEO Christophe Fouquet emphasized that artificial intelligence remains the key growth driver for the semiconductor industry, reinforcing the need for advanced lithography technology. He acknowledged, however, that market dynamics are evolving unevenly across ASML’s customer base, creating both opportunities and risks. These comments come in the wake of DeepSeek’s announcement about its AI model, which some feared could disrupt demand for high-end chips requiring ASML’s EUV technology. ASML’s results and guidance suggest those concerns were overstated, as AI chip demand continues to fuel strong orders for the company’s next-generation equipment.
The positive reaction to ASML’s earnings comes at a critical juncture for the broader tech sector. The report precedes upcoming earnings from major AI and semiconductor players, including Meta (META), Microsoft (MSFT), Tesla (TSLA), Amazon (AMZN), and Apple (AAPL). ASML’s strong bookings and upbeat guidance signal resilience in AI-linked semiconductor demand, which may set a bullish tone ahead of these major reports. Following a sharp sell-off in AI-related stocks earlier in the week, ASML’s results have provided investors with much-needed reassurance about the long-term growth trajectory of AI-driven semiconductor demand.
