ASML (ASML) stock rose as much as 5% in premarket trading after the Dutch semiconductor equipment company posted better than expected fourth quarter earnings and its CEO dismissed concerns that DeepSeek’s latest breakthrough would hurt demand for AI chips.
ASML invented the technology required to make the world’s most advanced artificial intelligence chips and is the only manufacturer of the complex machines — that latest version of which cost nearly $400 million — that use its EUV lithography technology.
ASML sells its machines to chip manufacturers such as TSMC (TSM), which uses its machines to produce chips for Nvidia (NVDA), Apple (AAPL), and other tech heavyweights.
The Dutch firm on Wednesday reported earnings per share of €6.85, ahead of the €6.68 expected, and its quarterly revenue of €9.2 billion topped the €9 billion forecast, according to Bloomberg consensus estimates.
ASML’s 2025 first quarter sales forecast also surpassed expectations, with its guidance range of €7.5 billion to €8.0 billion ahead of the €7.2 billion consensus estimate, per Bloomberg.
“Consistent with our view from the last quarter, the growth in artificial intelligence is the key driver for growth in our industry,” said CEO Christophe Fouquet in a statement.
“It has created a shift in the market dynamics that is not benefiting all of our customers equally, which creates both opportunities and risks as reflected in our 2025 revenue range.”
ASML’s results were under more scrutiny than usual after its prior quarterly earnings came in far below expectations and sent its stocks — and those of other chipmakers — tumbling.
Shares have been under pressure in recent weeks amid announcements of more restrictive export controls from the Netherlands and the US seeking to disrupt China’s access to advanced semiconductors.
While ASML has never been permitted to export EUV lithography machines to China, its sales of other equipment to the region have surged in recent years. ASML’s revenue from China surged to roughly €9 billion in 2024 from €6.4 billion the previous year, per Bloomberg data.
The stock tumbled this week as news of a cost-effective AI model from Chinese firm DeepSeek cast doubt on the ultra-high spending from Western big tech companies on AI infrastructure, such as semiconductors made by ASML’s machines.
Fouqet dismissed those concerns in an interview with CNBC Wednesday.
“A lower cost of AI could mean more applications,” Fouqet said. “More applications means more demand over time. We see that as an opportunity for more chips demand.”
