ASML Reports Steady Q3 Profits, Cautions Sharp Decline in China Sales Ahead

Dutch semiconductor equipment maker ASML reported steady profits for the third quarter of 2025 but issued a warning about a major slowdown in its China business next year. The company posted a net profit of €2.125 billion ($2.5 billion), slightly higher than the €2.077 billion recorded during the same period last year. Net sales stood at €7.5 billion, aligning with its earlier forecast of €7.4–€7.9 billion.

Chief Executive Christophe Fouquet stated that while the company performed well in the third quarter, demand from Chinese customers is expected to fall sharply in 2026. “We expect China customer demand, and therefore our total China sales in 2026, to decline significantly compared to our very strong performance in 2024 and 2025,” he said.

Despite geopolitical challenges and export restrictions, ASML expects 2025 full-year sales to grow by around 15%, with fourth-quarter sales projected between €9.2 billion and €9.8 billion. Fouquet noted that recent positive developments had eased some uncertainties, and the company will share more details about its 2026 outlook in January.

ASML’s net bookings, a key indicator of future demand, reached €5.4 billion, slightly below the €5.5 billion recorded in the previous quarter. The company remains optimistic about long-term growth, driven by the expanding artificial intelligence (AI) market, which could boost annual revenues to €44–€60 billion by 2030.

ASML’s advanced lithography machines are essential for producing cutting-edge semiconductors used in everything from smartphones to defense systems. However, escalating US-China tensions and new export controls have impacted its business. Recently, relations between China and the Netherlands became strained after the Dutch government invoked national security laws to take control of Chinese-owned chipmaker Nexperia, further highlighting the geopolitical complexities surrounding the global semiconductor industry.

Source: The Economic Times