Asian chip stocks fall on ASML's dismal forecast, potential US export cap

Asian chip stocks fell on Wednesday after Dutch semiconductor equipment maker ASML posted a disappointing sales forecast, driving up global stocks in the sector.

Shares of Japanese semiconductor manufacturers Tokyo Electron About 10% drop, the largest rate logged. Renesas Electronics decreased by more than 3%, and AdventistA testing equipment supplier fell 0.8%.

Taiwan Semiconductor Manufacturing Company And Be hi precision art – internationally known as Foxconn – fell as much as 3.3% and 1.6% respectively.

South Korean chipmaking heavyweight SK Hynix, which makes high-bandwidth memory chips for AI applications for Nvidia, traded 1.6% lower. Shares of Samsung Electronics, the world's largest maker of dynamic random-access memory chips, fell 1.9%.

Losses in the region's semiconductor sector also dragged down major indices. of Japan Nikkei 225 lost more than 2%, Kospi of South Korea 0.6% and Taiwan Weighted Index The slide is 0.7%.

In a report on Tuesday, ASML, based in Veldhoven, Netherlands, said it expects net sales between 30 billion euros and 35 billion euros ($32.7 billion and $38.1 billion) for 2025, the bottom half of the range. previously provided.

Net bookings for the September quarter were 2.6 billion euros ($2.83 billion), the company said – below the LSEG consensus estimate of 5.6 billion euros. Net sales, however, exceeded expectations, coming in at 7.5 billion euros.

The company's CEO warned of caution among customers and said that “the recovery is more gradual than previously expected.”

After ASML tanked 16%, other global chipmakers plunged. Nvidia fell 4.7% and AMD fell 5.2%.

Also on Tuesday, Bloomberg reported that Biden administration officials discussed limiting sales of advanced AI chips from Nvidia over national security concerns, further dampening investor sentiment around the semiconductor sector.

ASML faces a difficult business outlook in China due to US and Dutch export bans on its shipments.

CFO Roger Dassen said Tuesday that he expects the company's China business to show “a more normal percentage of our order book and our business.”

“So we expect China to come in at about 20% of our total revenue for next year,” he said. In its June-quarter earnings presentation, ASML said 49% of its sales came from China.

– Ryan Brown contributed to this story.