ASML shares jump as surge in orders defies fears of DeepSeek hitting AI chip demand

Key Points

  • ASML reported a significant increase in fourth-quarter net bookings, up 169% from the previous quarter.
  • Despite concerns over AI spending due to DeepSeek's low-cost model, ASML's CEO remains optimistic about future demand for semiconductors.
  • ASML's shares surged by up to 11% but later moderated to a 7.4% increase.
  • The company's 2025 sales outlook remains unchanged, expecting between 30 to 35 billion euros in revenue.
  • ASML anticipates a rebalancing of demand in China for 2025, expecting a return to more normal demand levels.

Summary

ASML, the Dutch semiconductor equipment maker, reported a substantial rise in fourth-quarter net bookings, signaling robust demand for its advanced chipmaking tools. Despite a global tech sell-off triggered by concerns over AI spending due to the introduction of DeepSeek's cost-effective AI model, ASML's shares initially surged by 11% before settling at a 7.4% increase. The company's financial performance exceeded expectations, with net sales and profit both surpassing consensus estimates. ASML's CEO, Christophe Fouquet, expressed optimism about the future, suggesting that lower-cost AI models could lead to increased applications and thus more demand for semiconductors. However, ASML anticipates a normalization of demand in China in 2025, following a period of heightened demand due to U.S. export restrictions. This outlook, combined with ASML's strong order backlog, provides reassurance to investors about the company's valuation and future growth potential.

cnbc
January 29, 2025
Stocks
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