ASML Stock: Semiconductor Equipment Maker Tops Q4 Forecasts

Semiconductor equipment supplier ASML (ASML) on Wednesday beat Wall Street’s targets for the fourth quarter and guided higher for the current period. That’s despite trade restrictions on China and a weakening semiconductor market.┬áStill, ASML stock fell in early trading.




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The Netherlands-based company earned the equivalent of $5 a share on sales of $6.99 billion in the December quarter. Analysts polled by FactSet expected ASML earnings of $4.62 a share on sales of $6.74 billion. In the year-earlier period, ASML earned $4.98 a share on sales of $5.66 billion. ASML reports financial results in euros.

For the current quarter, ASML forecast revenue of $6.84 billion, based on the midpoint of its outlook. Wall Street had predicted $6.46 billion. In the first quarter last year, ASML generated $3.84 billion in sales.

ASML expects 2023 net sales to grow over 25% compared with 2022. Last year, its sales increased 14%.

ASML Stock Drops After Report

In premarket trading on the stock market today, ASML stock fell 1.8% to 657.85.

The Dutch company makes advanced lithography equipment 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 said 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 research director at GlobalData, said ASML’s results were “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 trade dispute is likely to remain an overhang on ASML stock this year, he said in a note to clients.

ASML stock ranks No. 10 out of 29 stocks in IBD’s semiconductor equipment industry group, according to IBD Stock Checkup. It has an IBD Composite Rating of 90 out of 99.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.

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