Investors and analysts expressed skepticism about ASML Holding NV (ASML.AS) on Wednesday following the company’s announcement to lower its financial forecast for 2025. The revision reflects ongoing weakness in several markets beyond AI and delayed customer orders.

While ASML’s role as a key supplier to global chipmakers remains unchallenged, concerns have emerged over its short-term sales outlook and whether it can sustain growth above the broader market in the long run.

The announcement sparked ASML’s sharpest share sell-off in 20 years, with prices dropping an additional 4.9% to 635.60 euros at 0840 GMT on Wednesday. This follows a peak in July when shares surpassed 1,000 euros ($1,088), capping a decade of rapid growth driven by its dominance in the lithography tools market essential for chip production.

ASML revealed that some of its customers have delayed new facilities and equipment upgrades, including those producing logic chips used in smartphones and PCs. Additionally, manufacturers of memory chips, crucial for various electronic devices, are postponing expansions and relying on existing equipment for a longer period.

Nick Rossolillo, from Concinnus Financial, noted, “Investors must temper expectations, especially for a company dependent on the capital investments of its manufacturing clients.”

Although ASML did not disclose which customers influenced the guidance cut, analysts suspect Taiwan Semiconductor Manufacturing Co. (TSMC), a supplier for Nvidia’s AI chips and Apple’s smartphone processors, may be among them. Michael Roeg of Petercam Degroof, a Belgian investment bank, cautioned that despite TSMC’s robust sales, its capital expenditure (capex) has remained low, raising concerns about industry-wide demand.

TSMC is not alone in trimming spending. Intel announced a $10 billion reduction in capex for 2025, and Samsung has reported difficulties with its Texas-based factory. Industry analysts estimate that ASML typically captures about 25% of chipmakers’ tool investments, although evolving production methods may reduce its share.

According to Han Dieperink, Chief Investment Officer at Aureus, customer delays could also reflect strategic efforts to secure better pricing from ASML, which could pressure the company’s profit margins. Dieperink also mentioned that Aureus recently reduced its ASML stake, citing high valuations and declining orders from Chinese customers amid U.S. export restrictions.

“China anticipated these restrictions and front-loaded purchases between 2022 and 2024,” Dieperink added.
At the current exchange rate, one U.S. dollar equals 0.9190 euros.