Dutch tech giant ASML Holding NV on Wednesday warned of a steep fall in its China business next year, as it booked flat net profit in the third quarter compared with the same period last year.
“We expect China customer demand, and therefore our China total net sales in 2026, to decline significantly compared to our very strong business there in 2024 and 2025,” ASML chief executive officer Christophe Fouquet said in a statement.
The firm announced net profits of 2.13 billion euros (US$2.5 billion), after 2.08 billion euros in the third quarter of last year. Net sales in the third quarter came in at 7.5 billion euros. ASML had forecast a figure between 7.4 billion and 7.9 billion euros.
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“Our third-quarter total net sales ... were in line with guidance, reflecting a good quarter for ASML,” Fouquet said.
“We do not expect 2026 total net sales to be below 2025,” he said, adding that the firm would give more details on next year’s outlook in January.
“I think we have seen a flow of positive news in the last few months that has helped to reduce some of the uncertainties we discussed last quarter,” Fouquet said.
The CEO said he expected sales in the fourth quarter to come in between 9.2 billion and 9.8 billion euros, while for this year, the firm predicts a 15 percent increase in total net sales.
Net bookings, the figure most closely watched in the markets as a predictor of performance, reached 5.4 billion euros, compared with 5.5 billion in the second quarter.
According to a presentation posted on the firm’s Web site, sales to China represented 42 percent of ASML’s overall business in the third quarter, up from 27 percent in the second quarter.
“We have been experiencing a very high cycle in China, especially through ... the last couple of years,” ASML chief financial officer Roger Dassen said in a call with investors.
“Our expectation and the visibility we have right now is that next year we go back to more reasonable business,” he added.
Longer term, ASML said that the rapidly expanding artificial intelligence (AI) market would push up its annual sales to between 44 billion and 60 billion euros by 2030. It posted 28.3 billion euros in net sales last year.
ASML has faced growing pressure from US and Dutch export curbs for its most advanced chipmaking tools to China, as Beijing and Western nations are locked in a battle for the key sector.
Last week, a US Congressional committee report said that five companies, including ASML, had sold US$38 billion of critical tech to China last year, including to firms flagged as US national security threats.
“China is striving with all its might to build a domestic, self-sufficient semiconductor manufacturing industry,” the report said.
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