ASML exceeds expectations with surge in AI demand

ASML, the leading maker of computer chip equipment, reported impressive fourth-quarter bookings of 7.09 billion euros ($7.39 billion), significantly surpassing analyst expectations. The surge in orders was driven by the increasing demand for advanced chip production tools fueled by the boom in AI. Following the announcement, ASML’s stock rose 11% to 722 euros, signalling investor optimism despite recent market volatility.

Analysts had expected bookings to total around 3.99 billion euros, up from 2.63 billion euros in the previous quarter. ASML’s CEO, Christophe Fouquet, emphasised that AI growth is a key driver for the industry, with major companies like TSMC, ASML’s largest customer, benefiting from the rise in AI chip demand. The company reported a net income of 2.7 billion euros on sales of 9.3 billion euros for the quarter, surpassing expectations.

Despite the positive results, analysts caution that the long-term impact of DeepSeek’s AI model—released this week and requiring less computing power than competitors—remains uncertain. Some fear it could affect the large investments tech giants make in AI chips. However, ASML’s strong quarterly performance and its 2025 sales forecast, ranging from 30-35 billion euros, suggest continued growth, particularly from companies like TSMC and SK Hynix.

ASML’s largest market was the US in the fourth quarter, accounting for 28% of sales, closely followed by China. However, the company anticipates that sales in China will decline, partly due to export restrictions on chip equipment imposed by the US and Dutch governments for national security reasons.