Dutch semiconductor equipment giant ASML shocked the market after accidentally releasing its Q3 earnings report a day early, revealing weaker-than-expected bookings and lowering its 2025 sales forecast. Despite robust demand for AI-related chips, the company reported a significant drop in orders from other semiconductor segments, prompting its shares to fall by 16%, the steepest drop since 1998.

ASML reported Q3 revenue of €7.5 billion ($8.2 billion) with a net profit of €2.1 billion. However, new orders for the quarter reached only €2.6 billion, well below the market expectation of €5.39 billion. The company revised its 2025 sales outlook to between €30 billion and €35 billion, down from the previously estimated upper range of €40 billion.

ASML’s CEO Christophe Fouquet explained that although AI-related chip demand remains strong, other parts of the semiconductor market, including logic and memory chips, have weakened, causing clients like Intel, Samsung, and Micron to delay orders. Fouquet warned that these market conditions are likely to persist into 2025, leading to customer caution.

The news also impacted the broader semiconductor sector, with U.S. chip stocks like Nvidia, AMD, Intel, and Broadcom experiencing drops of 3% to 5%. The Philadelphia Semiconductor Index fell nearly 5%, while Nvidia, fresh off briefly becoming the world's most valuable company, saw its stock drop by 4.5%, wiping out $158 billion in market value.

Meanwhile, ASML’s sales to China hit a record €2.79 billion, or 47% of its total quarterly revenue, despite ongoing U.S. restrictions on advanced chip technology sales to China. However, concerns remain over the long-term impact of Washington's chip war with Beijing, as U.S. officials consider further restrictions on AI chip exports to certain countries, including those in the Middle East, due to national security concerns.