Dutch semiconductor giant ASML has released its financial results for the fourth quarter and full year 2024. The company reported total net sales of €28.3 billion, an increase from €27.6 billion in 2023. This growth was primarily driven by rising demand for semiconductors due to rapid advancements in artificial intelligence (AI).
Despite higher sales, net income declined slightly to €7.6 billion from €7.8 billion in 2023. ASML’s share price surged 10.45% on Wednesday morning following the earnings announcement.
The semiconductor industry remains under pressure from China’s new AI-powered chatbot DeepSeek, which has disrupted market expectations.
Strong Bookings and Positive Outlook for 2025
ASML reported net bookings of €7.1 billion in the fourth quarter, significantly higher than the €2.6 billion recorded in the previous quarter. The sharp rise was largely driven by strong demand from TSMC.
Extreme ultraviolet lithography (EUV) technology, essential for producing smaller and more powerful chips, accounted for €3 billion of the fourth-quarter bookings. ASML remains the only company capable of manufacturing EUV systems.
However, total net bookings for 2024 fell to €18.9 billion, down from €20 billion in 2023. Looking ahead, ASML expects first-quarter 2025 net sales between €7.5 billion and €8 billion, with a gross margin ranging from 52% to 53%.
For the full year 2025, ASML anticipates net sales between €30 billion and €35 billion, with a projected gross margin of 51% to 53%. CEO Christophe Fouquet emphasized that AI continues to be the primary growth driver in the semiconductor industry.
Market Confidence Grows Despite DeepSeek’s Impact
Technology analyst Ben Barringer from Quilter Cheviot described ASML’s earnings as “impressive,” exceeding market expectations. Revenue came in 2.5% above forecasts, while profits surpassed estimates by 8%. ASML’s guidance for 2025 was also 9% higher than anticipated, reinforcing market confidence.
The arrival of DeepSeek has created uncertainty in the AI and semiconductor markets. The Chinese AI chatbot has quickly gained traction, surpassing OpenAI as the most downloaded free app on the US Apple Store. DeepSeek claims to outperform US competitors in coding and mathematics while using fewer advanced chips and less memory, significantly reducing costs.
Nvidia faced severe market losses due to concerns over DeepSeek, with nearly $600 billion (€576.67 billion) erased from its market value on Monday. The development has also intensified fears that the US is failing to curb China’s rapid AI advancements.
Despite these challenges, ASML’s robust fourth-quarter orders suggest resilience in the face of market disruptions. However, investment director Russ Mould from AJ Bell cautioned that while ASML’s short-term outlook is strong, the long-term impact of DeepSeek on semiconductor demand remains uncertain.
Chief executive Fouquet reiterated that AI remains the main growth driver in the business. However, if generative AI development becomes more cost-effective and less complex, demand for high-performance semiconductors could weaken beyond 2025. The industry is now entering a period of adjustment as companies assess the evolving competitive landscape.
