ASML Shares Move Green YTD as Earnings Impress

Shares in Dutch tech giant ASML (AMS: ASML) are trading up by 8.6% today, as recent results and an growing order book moved the stock green on the year, back above €700. After what had been a difficult 2024 for ASML stockholders, the return to green (+1.68% through 2025) will be welcome.

Sentiment was not swayed by a slight dip in the company's annual net profit, with markets seemingly focused on better-than-expected orders for ASML's cutting-edge chip-making machines.

In the fourth quarter, ASML reported net bookings totalling 7.1 billion euros, reflecting strong demand. This performance in orders underlines the company's importance in the global semiconductor supply chain.

For the year 2024, ASML reported total sales of 28.3 billion euros, surpassing earlier forecasts of 28 billion euros. The company's CEO, Christophe Fouquet, hailed the year as “another record year” for ASML, highlighting artificial intelligence as a crucial growth driver for the company's future. Despite a minor drop in after-tax profit to 7.6 billion euros from 7.8 billion euros in the previous year, the outlook remained positive.

ASML maintains a strong sales forecast for 2025, with expectations between 30-35 billion euros. The company acknowledges the challenges posed by export controls imposed by the US and Dutch governments. These factors have influenced ASML's cautious but optimistic projections. Nevertheless, the emergence of competitive dynamics in the technology sector, notably from Chinese AI start-up DeepSeek, underscores the evolving market landscape.

In the short term, ASML's sales for the fourth quarter alone amounted to 9.3 billion euros, exceeding the guidance range of 8.8-9.2 billion euros. This was further bolstered by a quarter-on-quarter increase in net profit, reaching 2.7 billion euros compared to 2.1 billion euros in the previous quarter. This financial stability comes after an October stock sell-off due to a “technical error” that prematurely disclosed third-quarter figures.

ASML's long-term sales guidance remains optimistic, targeting up to 60 billion euros by 2030, largely driven by rapid growth in the AI market. The company’s strong performance and ability to secure significant orders point to a positive outlook, notwithstanding geopolitical and market challenges.