Global AI rush helps ASML post orders beat, but China outlook dims

By Nathan Vifflin and Toby Sterling (Reuters) -ASML, the world's biggest supplier of computer chip-making equipment, on Wednesday repeated it expects to benefit from booming investments in AI, but warned that it expected a significant fall in demand from China next year. Analysts said the lukewarm guidance, which said sales will be flat or better in 2026, may be upgraded in January. "It could have been a stronger message," Michael Roeg of Degroof Petercam said.  Net bookings, the most closely watched figure in the industry, were 5.40 billion euros ($6.27 billion) in the third quarter of 2025, versus analysts' consensus estimate of 5.36 billion euros, according to researcher Visible Alpha. The results came after a flurry of mega-deals between AI firms and chipmakers in September and October, all of which will mean more demand for chips, which make up around half of the cost of data centres.  CEO Christophe Fouquet said ASML, Europe's largest tech firm by market capitalization, is seeing "continued positive momentum around investments in AI," and that it was extending to more of its customers both in advanced logic chips such as those used in smartphones and AI datacenters, and advanced memory chips also needed for AI. ASML's lithography tools, which are essential for making the circuitry of chips, are sold to TSMC of Taiwan, which manufactures most AI chips for Nvidia and other logic firms such as SMIC of China and Intel of the U.S. It also serves memory chip makers Samsung  SK Hynix, and Micron, among others. Weak Chinese demand came as a surprise after it made up nearly a third of new ASML tool sales through the first nine months of 2025. "We expect China customer demand, and therefore our China total net sales in 2026 to decline significantly," Fouquet said. The company reported third-quarter net income of 2.12 billion euros in line with the 2.11 billion euros analysts expected, according to LSEG IBES data.   ($1 = 0.8607 euros) (Reporting by Toby Sterling in Amsterdam, Nathan Vifflin in Gdansk; Editing by Matt Scuffham and Kim Coghill)

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