Shares of chipmaker ASML plunge 15% after an early release warning of weaker sales in China

Shares in the semiconductor equipment manufacturer ASML fell 15.6% on Tuesday after the Dutch company reported results a day early.

The move dragged other chip stocks lower, along with it NvidiaAdvanced Micro Devices and Broadcom all fell at least 4% following the news.

ASML said it expects net sales to be between 30 billion euros ($32.72 billion) and 35 billion euros in 2025, which is in the lower half of the previously reported range.

Net bookings for the September quarter were 2.6 billion euros ($2.83 billion), the company said, well below the LSEG consensus estimate of 5.6 billion euros.

“While there continues to be strong developments and upside potential in the AI ​​space, the recovery in other market segments is taking longer. It now appears that the recovery is slower than previously expected,” the company’s CEO Christophe Fouquet said in the earnings release.

Ahead of ASML's results, Wall Street analysts had become more cautious about the chip maker, which is a key supplier to the entire semiconductor industry.

ASML's extreme ultraviolet lithography (EUV) machines are used by many of the world's largest chipmakers – from Nvidia to TSMC – to produce advanced chips.

Roger Dassen, ASML's chief financial officer, also said Tuesday that he expects the company's China business to be a “more normal percentage in our order book and also in our business.”

“We are seeing a trend in China toward historically normal percentages in our business,” Dassen said, according to a transcript of a video also posted a day earlier.

“We therefore expect China to account for around 20% of our total sales next year. That would also correspond to its share in our order backlog.”

In its second-quarter earnings presentation, the Dutch company said 49% of its revenue was generated in China.

This is a breaking news story and will be updated shortly.