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ASML Reports Profit Rise, Warns of Flat 2024 Market

ASML, a key semiconductor firm specializing in extreme ultraviolet lithography machines, reported a year-on-year increase in profit for the third quarter, surpassing analyst expectations. However, the company forecasted that its 2024 revenue would remain flat.

Here’s a snapshot of ASML’s third-quarter performance compared to estimates:

Net sales: €6.67 billion ($7.1 billion) versus an expected €6.71 billion

Net profit: €1.89 billion versus an expected €1.8 billion

While net sales rose by 15.5% from the same period the previous year, and net profit increased by around 11%, both figures represented a decline from the second-quarter results.

ASML CEO Peter Wennink acknowledged that the semiconductor industry is navigating the bottom of the cycle, with customers anticipating a visible inflection point by the end of the year. He stated that 2024 is expected to be a transition year, characterized by a more conservative view, with revenue numbers similar to 2023. However, he highlighted 2024 as crucial for preparing for the significant growth anticipated in 2025.

The semiconductor market has faced challenges due to weak demand for products like smartphones and laptops, impacting companies such as TSMC and Samsung, major chip manufacturers, and customers of ASML. Despite the challenges, ASML reaffirmed its guidance for a 30% year-on-year increase in net sales for 2023.

ASML has been caught in the crossfire of technological tensions between the U.S. and China, and the Netherlands, where ASML is headquartered, introduced export restrictions on advanced semiconductor equipment in June. ASML has maintained that these measures are unlikely to impact its 2023 financial results.

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