Semiconductor equipment giant ASML Holdings’ (ASML) Nasdaq-listed shares fell by over 4% in the pre-market session after it reported mixed first-quarter results. Also, the company missed analysts’ forecasts for Q2 revenues. Moreover, ASML cautioned that uncertainty from potential new U.S. trade restrictions could hurt future demand for its chipmaking machinery.
ASML Q1 Highlights
For the first quarter, ASML reported sales of €7.74 billion ($8.81 billion), which missed the analysts’ consensus estimate of €7.77 billion. However, this figure was up from €5.29 billion in the same period last year. The upside was driven by robust demand for lithography systems.
According to Main Street Data, revenue from the company’s System segment, which includes sales from selling new and used lithography systems, has increased at a CAGR of 17% in the past four years.
Meanwhile, ASML’s Q1 net profit jumped 93.4% year-over-year to €2.36 billion and beat the Street’s expectations of €2.3 billion. Also, net bookings totaled €3.94 billion, up 9.1% from the year-ago quarter but missed the consensus estimate of €4.89 billion.
Tariff Uncertainty Weighs on Outlook
ASML’s outlook for 2025 and 2026 remains optimistic, with expectations of growth driven by strong demand for its lithography systems, particularly in AI-related technologies. The company maintained its prior forecast that 2025 net sales will be between €30 billion and €35 billion, with a gross margin of 51% to 53%.
However, ASML CEO Christophe Fouquet cautioned that the prevailing uncertainty among some customers about the U.S. President’s tariff plans could lead to ASML’s full-year revenue landing at the lower end of its expectations.
For Q2, ASML expects net sales between €7.2 billion and €7.7 billion, with a gross margin of 50% to 53%. However, the outlook fell below analysts’ expectations of €7.80 billion.
Long-Term Optimism Prevails
Despite the current headwinds related to trade uncertainty, ASML remains optimistic about its long-term prospects. The company anticipates significant growth driven by the continued expansion of AI and the increasing demand for advanced semiconductors.
Importantly, Fouquet projects that ASML’s net sales could reach €44 billion to €60 billion by 2030.
Is ASML Stock a Buy?
Today’s price decline comes after a nearly 9% fall in ASML’s share price over the past three months. Overall, Wall Street has a Moderate Buy consensus rating on ASML stock based on five Buys and two Holds assigned in the last three months. At $941.36, the average ASML stock price target implies a 37.79% upside potential.
