ASML Growing Strongly Despite Falling Order Bookings

21 oct

ASML Holding N.V., one of the leading technology suppliers in the semiconductor industry, has reported its financial results for the third quarter of 2024, reporting solid growth despite the challenges faced. The company achieved net sales of €7.5 billion, representing a 20% increase over the previous quarter. This growth was driven mainly by demand for its advanced lithography systems, essential for chip manufacturing, with sales of 106 systems in the latest quarter, up 19% from the year-earlier period.

However, ASML is facing a notable decline in net orders, which fell by 53%. This drop reflects a near-term slowdown in demand, forcing the company to adjust its expectations for fiscal 2025. ASML has revised down its revenue projection, now estimating between €30 billion and €35 billion, a sign that uncertainty in the market could affect its future performance.

Despite these challenges, ASML maintains a robust gross margin of over 50%, demonstrating its ability to remain profitable even in a challenging economic environment. In addition, free cash flow also improved significantly, reaching €534 million, with a margin of 7%, which strengthens its financial position and its ability to cope with the conditions of a challenging economic environment.

On the technical side, the company has lost value from the $1,110.09 it was valued at in July, to the $677.12 to which it plummeted between its highs and October 16, especially the latest results have affected to reduce its value by almost -23% in a matter of 2 trading days. On Friday its shares partially recovered in price and a recovery could be seen as the company is highly oversold at 37.77% and its checkpoint marks us that the average trading zone is located in the direction of $920. The delta indicator marks a zone to return to near $735, so if we begin to see signs of price recovery. It means that the company has a chance of a partial price recovery.

With growing global demand for semiconductors driven by emerging technologies such as artificial intelligence, ASML remains a key player in the sector. Its ability to innovate and stay on the cutting edge of technology makes it an attractive option for long-term investors, despite volatility in orders.
Ion Jauregui – ActivTrades Analyst





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