ASML rises as orders beat estimates amid AI rush, China demand to see slowdown in 2026

[ASML headquarters in Silicon Valley]
Sundry Photography

Shares of ASML (NASDAQ:ASML [https://seekingalpha.com/symbol/ASML]) rose about 4% premarket on Wednesday after the company's orders surpassed estimates in the third quarter and it noted that sales next year would not be less than that in 2025.

However, the Dutch chip equipment maker did warn that it expects a decline in demand from China next year.

KEY METRICS

ASML — which makes extreme ultraviolet lithography (EUV) and Deep Ultraviolet (DUV) lithography system — saw third quarter net sales increase about 0.7% year-over-year to €7.52B.

"On the market side, we have seen continued positive momentum around investments in AI, and have also seen this extending to more customers, both in leading-edge Logic and advanced DRAM," said [https://seekingalpha.com/pr/20266031-asml-reports-7_5-billion-total-net-sales-and-2_1-billion-net-income-in-q3-2025#hasComeFromMpArticle] ASML CEO Christophe Fouquet.

The company reported bookings of €5.4B in the third quarter, beating an average estimate of €4.9B by analysts, Bloomberg News reported [https://www.bloomberg.com/news/articles/2025-10-15/asml-orders-beat-expectations-as-ai-arms-race-boosts-demand?srnd=phx-technology]. Net bookings for EUV machines were €3.6B.

ASML said in January that it would stop reporting order bookings after 2025.

CHINA SALES

China accounted for 42% of the total net system sales of about €5.552B, more than any region with Taiwan being second having 30% share in the third quarter of 2025. In the second quarter of 2025, China had accounted for 27% of the total net system sales of about €5.602B, behind Taiwan with 35% share.

The U.S. had 6% share in the third quarter of 2025, while in the second quarter of 2025. it had 10% share of the total net system sales of about €5.602B.

DIVIDEND AND BUYBACK

In the third quarter, ASML said it paid an interim dividend of €1.60 per ordinary share. The second quarterly interim dividend over 2025 will be €1.60 per ordinary share and will be made payable on Nov. 6.

In the third quarter ASML bought around 218 thousand shares for a total amount of about €148M.

ASML said [https://ourbrand.asml.com/m/4beae8fbfeefabee/original/2025_10_15_Presentation-Investor-Relations-Q3-2025.pdf] it does not expect to complete the €12B share buyback program in full within the2022-2025 timeframe. The company intends to announce a new share buyback program in January 2026. As of Sept. 28, 2025, ASML acquired 9 million shares under this program for a total consideration of €5.9B.

OUTLOOK

"First, we continue to see strong news about commitment to AI. Which means, we think, investment in advanced Logic and DRAM. Second, and it's very important for us, it looks like AI is going to benefit a larger part of our customer base," said [https://ourbrand.asml.com/m/70ca08c49d545c87/original/ASML-Results-Video-Transcript-Q3-2025.pdf] ASML CEO Christophe Fouquet.

"On the other hand, when we look at China, we believe that the demand of our Chinese customers is going to be significantly lower in 2026 than it has been in 2024 and 2025 when we had very strong business there," Fouquet added.

Fouquet noted that the company believes that the impact of these dynamics will only be effective partially in 2026.

"But still for 2026 we expect our net sales to not be below 2025. If we look at our product mix, the dynamics are going to favor EUV, which we believe will increase. While the dynamic in China will most probably lower the business in DUV," Fouquet noted.

The CEO noted that the company will provide more details about 2026 in its January call.

ASML expects fourth quarter 2025 total net sales between €9.2B and €9.8B, and a gross margin between 51% and 53%.

"It's a big quarter. A lot bigger than last quarter, but actually that's as planned and also as we communicated before," said ASML CFO Roger Dassen.

The company expects a full-year 2025 total net sales increase of around 15% relative to 2024, with a gross margin of around 52%.

Shares of other chip equipment makers also rose premarket on Wednesday. Applied Materials (AMAT [https://seekingalpha.com/symbol/AMAT]), Lam Research (LRCX [https://seekingalpha.com/symbol/LRCX]) and KLA (KLAC [https://seekingalpha.com/symbol/KLAC]) each rose nearly 2%.

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* ASML Holding N.V. 2025 Q3 - Results - Earnings Call Presentation [https://seekingalpha.com/article/4830018-asml-holding-n-v-2025-q3-results-earnings-call-presentation]
* ASML Earnings Preview: Why I Expect A Beat And An Upbeat Outlook [https://seekingalpha.com/article/4829976-asml-earnings-preview-why-i-expect-a-beat-and-an-upbeat-outlook]
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