Shares in ASML fall another 5 percent; No longer Europe's highest valued tech firm
Shares of Dutch semiconductor equipment maker ASML fell another 5.12 percent on Wednesday, bringing the share price down to 633.90 euros on Euronext Amsterdam. In two days of trading, shares in the Veldhoven-based company have plunged by nearly 20 percent, and has fallen from the top position as the most highly valued publicly-traded technology company in Europe.
ASML's market capitalization fell by 62.9 billion euros since Monday to 253.3 billion euros. Additionally, ASML was a significant laggard in the Pan-European Stoxx 600 index.
Meanwhile, shares in SAP SE drove the German software company's market capitalization up to 258.89 billion euros when the XETRA exchange closed on Wednesday afternoon. SAP's shares are also traded on the New York Stock Exchange, which closes at 4 p.m. locally, or 10 p.m. in the Netherlands.
Shares in ASML closed at the lowest level since December 4 after the company accidentally released significantly lowered projections and third quarter financial figures well below analyst expectations. That data was due to be released Wednesday morning, but was inadvertently released by the company an hour before Euronext Amsterdam closed its trading day on Tuesday.
During a call with analysts on Wednesday, CEO Christophe Fouquet apologized for the gaff. He said it was a technical error, that led to the data being posted on the company's website and distributed to Bloomberg, precipitating a 16 percent fall in share price on Tuesday alone.
Chief Financial Officer Roger Dassen confirmed that many orders expected for next year will be delayed to 2026. Additionally, the company is becoming more cautious with regard to China, with mounting pressure on export restrictions affecting ASML's ability to send its ultraviolet lithography equipment to that country. Chinese clients should represent around 20 percent of revenue next year, Dassen said.
“The 20% is what we consider to be a normal percentage of our business for China,” Fouquet said. “So we would assume that is a number that also on a go forward basis, we believe would be realistic for China. Of course, subject to, to anything related to export controls.”
“We read newspapers, and we read continued speculation on things that might happen,” Dassen said. “And as a result of that, we’ve decided to take a more cautious view” on China, he added.
Fouquet also said that artificial intelligence was very important to ASML's current results. “Today, without AI, the market would be very sad, if you ask me,” the CEO said. “The recovery is not what I think everyone had wished for.”
ASML reported third-quarter net income of 2.1 billion euros on 7.5 billion euros in net sales. The company expects sales of around 9 billion euros next quarter, which would bring total net sales for the year to roughly 28 billion euros.
The company also said that total net sales next year should grow to 30 to 35 billion euros. The Veldhoven company is expected to see its margin improve from just below 50 percent to between 51 and 53 percent in 2025.
