ASML Q1 orders miss forecast as AI, trade worries grow

ASML Holding NV, a Dutch manufacturer of advanced lithography machines, reported lower-than-expected orders for the first quarter of 2025.

The company recorded bookings of €3.94 billion (US$4.48 billion), missing analysts’ average projections of €4.82 billion (US$5.48 billion), according to Bloomberg data.

Despite weak orders, ASML kept its full-year sales forecast of €30 billion (US$34 billion) to €35 billion (US$39 billion).

The outlook is clouded by slowing AI chip demand and potential impacts from US trade policy.

Although some semiconductor gear was exempt from new tariffs, broader trade tensions remain a risk.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Semiconductor market shows resilience despite short-term fluctuations

ASML’s earnings miss comes during a transitional year for the semiconductor industry, with contrasting short-term challenges and long-term growth indicators.

While ASML faces order weakness now, the World Semiconductor Trade Statistics (WSTS) organization forecasts robust 19.0% year-over-year growth for the broader semiconductor market in 2024, reaching $627 billion globally 1.

This growth is primarily driven by Memory (projected 81.0% increase) and Logic segments (16.9% growth), the very sectors that rely heavily on ASML’s lithography equipment 1.

The industry has historically followed technology-driven cycles, with previous waves powered by PCs and smartphones, while the current wave is being fueled by AI applications. ASML’s maintained 2025 sales forecast of €30-35 billion aligns with WSTS’s projection of continued industry expansion of 11.2% in 2025, suggesting the company sees current weakness as temporary rather than structural 1.

2️⃣ Geopolitical tensions reshaping semiconductor investment patterns

The semiconductor industry is navigating complex geopolitical challenges that extend beyond ASML’s quarterly results, creating a realignment of global manufacturing capacity and investment.

U.S. semiconductor manufacturing capacity is projected to triple by 2032 with a 203% growth from 2022 levels, representing the largest projected increase globally, a direct response to supply chain vulnerabilities exposed in recent years 2.

These investment shifts are reflected in capital expenditure patterns, with the U.S. expected to account for 28% of global semiconductor capital expenditures from 2024-2032, up from what would have been just 9% without the CHIPS Act 2.