ASML surges on strong orders, says AI not benefiting all customers equally

Shares in ASML Holding NV (NASDAQ:ASML) surged 8.8% higher after the maker of semiconductor manufacturing equipment turned in record revenues and earnings well ahead of expectations, as well as backing its outlook for 2025.

Revenues were boosted by a strong level of orders for the final quarter of last year of €7.1 billion, of which €3.0 billion was its cutting-edge extreme ultraviolet (EUV) lithography machines.

The total quarterly bookings were much higher than the analyst consensus forecast of around €3.5-4.0 billion depending on the Visible Alpha or Bloomberg poll, though down from the massive €9.2 billion of bookings a year earlier. 

At the year end, the Dutch group had an order backlog of €36 billion.

CEO Christophe Fouquet said the record revenues, net sales and gross margin were all above guidance, which "was primarily driven by additional upgrades".

ASML also recognized revenue on two of its new 'high NA' EUV systems, with a third shipped to a customer in the fourth quarter.

Revenues came in at €9.26 billion, ahead of the average forecast of €9.04 billion, at a gross margin of 51.7% that was also stronger than expected.

This meant earnings per share were €6.84, up 31% year on year, and versus €6.73 expectations. 

Since orders are lumpy, ASML will no longer provide order data from 2026 but reiterated 2025 guidance for revenues of €30-35 billion, versus a consensus of just over €32 billion, with gross margins of 51-53%.

For the first quarter of 2025, Fouquet said the group expects net sales between €7.5 billion and €8.0 billion, with a gross margin between 52% and 53%.

"Consistent with our view from the last quarter, the growth in artificial intelligence is the key driver for growth in our industry," he said. 

"It has created a shift in the market dynamics that is not benefiting all of our customers equally, which creates both opportunities and risks as reflected in our 2025 revenue range." 

While China revenues frorom Q4 were a bit higher than expected, ASML said it continues to expect China to normalise this year.

Analysts at Jefferies said: "The strong Q4 booking and €36bn backlog will dispel some of the bearish concerns regarding 2025 itself, though concerns on the 2026 growth are likely to persist."