ASML (ASML -9%) saw a significant drop today after announcing its Q2 results. The semiconductor equipment maker reported a 23.2% year-over-year revenue growth to €7.7 billion, slightly surpassing expectations due to one-time revenue recognition and business upgrades. ASML also exceeded Q2 EPS expectations, marking its largest beat in over five years.
Despite the strong Q2 performance, investors were disappointed with ASML's guidance for Q3 and FY25, which fell short of analyst predictions.
- ASML attributed the weak guidance to macroeconomic and geopolitical challenges faced by its customers, impacting their capital expenditure timing. Tariffs also appear to affect this timing.
- Management's cautionary statement, "while we are still praying for growth in 2026, we cannot confirm it at this stage," heightened investor concerns.
- ASML now forecasts Q3 revenue between €7.4-7.9 billion and expects FY25 revenue to grow by 15%, both below market expectations.
- The company's cautious outlook has led to selling pressure among its peers, such as Applied Materials (AMAT -3%), LAM Research (LRCX -2%), and KLA Corporation (KLAC -2%).
The impressive Q2 results are being overshadowed by ASML's cautious guidance for Q3 and FY25. Investors are concerned that other semiconductor equipment companies may also provide cautious outlooks in their upcoming earnings reports.
