ASML Sees Sales Growth Driven by AI Enthusiasm

Investing.com – ASML (AS:ASML) projects an average sales growth of 8% to 14% over the next five years, fueled by increased demand for computer chip equipment, primarily due to the artificial intelligence boom.

Europe's largest tech company, ASML, presented this guidance ahead of its investor day in the Netherlands. Chief Executive Christophe Fouquet emphasized ASML's capacity to scale its advanced chip manufacturing technology into the next decade, positioning the company to leverage opportunities provided by AI.

Fouquet stated that revenues and profits are set to rise significantly, with revenue expected to reach between 44 billion euros and 60 billion euros by 2030 and gross margins projected at 56% to 60%, consistent with the company’s 2022 outlook.

Analysts from JPMorgan Chase noted that the lack of changes in guidance was a positive sign, especially following ASML's lower-than-expected sales forecasts for the 2025 fiscal year announced in October.

The analysts expressed surprise that ASML did not adjust its 2030 guidance, considering its revenue expectations for 2025 were missed. Despite the existing AI growth potential, there was no pressing need for revised guidance in light of a weaker consumer environment.

JPMorgan analysts highlighted that the current forecast suggests about 10% compound annual revenue growth from next year to 2030, with an anticipated operational income increase of around 15%.

They suggested that these figures could make ASML's stock appealing to investors as the market begins to move past the current semiconductor downturn.

ASML is contending with its customers, including major tech firms like Taiwan Semiconductor Manufacturing Corp. and Intel (NASDAQ:INTC), scaling back equipment orders due to sluggish demand for non-AI chips. The company also faces restrictions on selling high-end lithography equipment to China, with investors concerned about its operational outlook in that market following Donald Trump's recent election victory in the US.

Shares of ASML saw a rise of more than 5% during Thursday's mid-morning European trading.

(Reuters contributed reporting.)