ASML Earnings Leak Sparks Broad Semiconductor Sell-Off, Sector Down Sharply As Dutch Chipmaker Lowers 2025 Outlook

Shares of ASML Holding N.V. (NASDAQ: ASML) plunged by over 16% on Tuesday morning trading in New York following an accidental early release of the company's third-quarter earnings report, sending shockwaves through the semiconductor sector.

The Dutch semiconductor equipment giant saw its stock drop sharply after lowering its 2025 sales outlook, casting a shadow over heightened future growth prospects.

ASML Lowers 2025 Sales Forecast

ASML's third-quarter report, published a day ahead of schedule, revealed a significant revision to its 2025 net sales guidance, now projected between 30 billion euros and 35 billion euros ($32.7 billion to $38.2 billion) - a reduction from the previously stated range of 30 billion euros to 40 billion euros.

This downgrade in outlook is driven by slower-than-expected recovery in key market segments, despite strong growth from artificial intelligence investments.

"While there continue to be strong developments and upside potential in AI, other market segments are taking longer to recover. It now appears the recovery is more gradual than previously expected. This is expected to continue in 2025, which is leading to customer cautiousness," said ASML president and CEO Christophe Fouquet.

"We expect our 2025 total net sales to grow to a range between 30-35 billion euros, which is the lower half of the range that we provided at our Investor Day," the CEO said.

ASML's Q3 Results: Solid Performance, But Outlook Sours

For Q3 2024, ASML reported total net sales of 7.5 billion euros, surpassing analyst expectations of 7.12 billion euros.

Net income reached 2.1 billion euros, with a gross margin of 50.8%. The company's quarterly net bookings came in at 2.6 billion euros. Importantly, 1.4 billion euros of the bookings were for EUV (extreme ultraviolet) systems, indicating ongoing demand for advanced chip manufacturing equipment.

For the fourth quarter of 2024, ASML expects total net sales to land between 8.8 billion euros and 9.2 billion euros with a gross margin between 49% and 50%. The company reaffirmed its full-year 2024 guidance, projecting total sales of around 28 billion euros.

Sector-Wide Impact: Chip Stocks Slide

The negative reaction to ASML's earnings leak rippled across the broader semiconductor sector, dragging down other major players.

By midday Tuesday, the iShares Semiconductor ETF (NYSE: SOXX) was down 3.7%, marking its worst trading session in over a month. The VanEck Semiconductor ETF (NYSE: SMH) dropped by over 4%, as investor sentiment soured on chip-related stocks.