Chip equipment maker ASML predicts lower sales in China amid strong AI demand

ASML, the Veldhoven-based chip equipment maker, anticipates a significant drop in sales to China next year. The company explained in its third-quarter report that Chinese customers had already made substantial purchases over the past two years.

China represented over 40 percent of ASML’s total chip machine sales last year, making it the firm’s biggest market. The strong presence there recently drew criticism from U.S. lawmakers, who are pushing to tighten restrictions on China’s access to semiconductor technology. ASML is already barred from exporting its most advanced systems to the country.

Analysts had been worried about a potential drop in Chinese sales, noting that buyers in the country seemed to be hoarding chipmaking equipment, possibly out of concern that tighter export restrictions could be imposed.

Investors were keenly anticipating ASML’s outlook for the coming year, curious to see whether the company could capitalize on the surge of AI-related spending by major tech firms, investments that demand sophisticated chips to handle intensive computing and data processing.

For now, ASML has merely indicated that its 2026 revenue will be at least on par with that of 2025. The company plans to offer further details early next year.

During the last quarter, ASML, the sole producer of lithography machines for cutting-edge chips, reported 7.5 billion euros in revenue. While slightly down from the previous quarter, this met the company’s forecasts. Net profit reached 2.1 billion euros.

CEO Christophe Fouquet said in an ASML video that a stream of good news has eased some of the uncertainty in the chip sector. He expects more of ASML’s customers to benefit from the growth of AI.

Earlier this year, Fouquet had warned that not all customers would benefit equally from AI. Yet in recent months, leading chipmakers Intel and Samsung have emerged with encouraging developments, after previously being seen as trailing in AI.

ASML anticipates significantly higher revenue in the last quarter of the year, ranging from 9.2 billion to 9.8 billion euros. “This is in line with our plans and previous guidance. We saw a similar pattern in 2024, with a strong fourth quarter,” stated CFO Roger Dassen.