Chip Gear Leader ASML Bucks Market Headwinds With Quarterly Beat

Semiconductor tools provider ASML (ASML) on Wednesday beat Wall Street’s targets for the fourth quarter and guided greater for the present interval. That’s regardless of commerce restrictions on China and a weakening semiconductor market. Still, ASML inventory fell in early buying and selling.


The Netherlands-based firm earned the equal of $5 a share on gross sales of $6.99 billion within the December quarter. Analysts polled by FactSet anticipated ASML earnings of $4.62 a share on gross sales of $6.74 billion. In the year-earlier interval, ASML earned $4.98 a share on gross sales of $5.66 billion. ASML stories monetary leads to euros.

For the present quarter, ASML forecast income of $6.84 billion, primarily based on the midpoint of its outlook. Wall Street had predicted $6.46 billion. In the primary quarter final 12 months, ASML generated $3.84 billion in gross sales.

ASML expects 2023 web gross sales to develop over 25% in contrast with 2022. Last 12 months, its gross sales elevated 14%.

ASML Stock Drops After Report

In premarket buying and selling on the inventory market right now, ASML inventory fell 1.8% to 657.85.

The Dutch firm makes superior lithography tools for etching tiny circuits onto semiconductors.

“We continue to see uncertainty in the market caused by inflation, rising interest rates, risk of recession and geopolitical developments related to export controls,” Chief Executive Officer Peter Wennink mentioned in a news release


He added, “However, our customers indicate that they expect the market to rebound in the second half of the year. Considering our order lead times and the strategic nature of lithography investments, demand for our systems therefore remains strong.”

China Trade Ban Remains A Worry

Josep Bori, thematic analysis director at InternationalData, mentioned ASML’s outcomes have been “very strong, particularly considering the headwinds caused by the U.S. ban on chip technology exports to China and softening consumer demand.”

Still, the U.S.-China commerce dispute is more likely to stay an overhang on ASML inventory this 12 months, he mentioned in a word to purchasers.

ASML inventory ranks No. 10 out of 29 shares in IBD’s semiconductor tools trade group, in response to IBD Stock Checkup. It has an IBD Composite Rating of 90 out of 99.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for extra tales on shopper know-how, software program and semiconductor shares.


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