ASML Stock Down On Weak Q2 Results, Outlook

(RTTNews) - Shares of ASML Holding N.V. were losing around 7 percent in the morning trading in Amsterdam as well as in pre-market activity on the Nasdaq Stock Exchange after the Dutch semiconductor equipment maker reported Wednesday weak second-quarter profit, net sales as well as volume. This was despite reporting growth in gross margin as well as value of booked systems.

Further, the company issued third -quarter outlook, expecting weak margin, and also maintained its fiscal 2024 outlook, expecting flat net sales.

ASML President and Chief Executive Officer Christophe Fouquet said, "While there are still uncertainties in the market, primarily driven by the macro environment, we expect industry recovery to continue in the second half of the year. … Our outlook for the full year 2024 remains unchanged. We see 2024 as a transition year with continued investments in both capacity ramp and technology. We currently see strong developments in AI, driving most of the industry recovery and growth, ahead of other market segments."

Looking ahead for the third quarter, ASML expects total net sales between 6.7 billion euros and 7.3 billion euros, and a gross margin between 50 percent and 51 percent. Total net sales for the prior year's third quarter were 6.67 billion euros with a gross margin of 51.9 percent.

ASML continues to expect fiscal 2024 total net sales to be similar to 2023, supported by a strong second half year.

Further, the company said an interim dividend of 1.52 euros per ordinary share will be made payable on August 7.

In its second quarter, net income declined to 1.58 billion euros from last year's 1.94 billion euros. Net income per ordinary share fell to 4.01 euros from prior year's 4.93 euros.

Income from operations as a percentage of net sales dropped to 29.4 percent from last year's 32.8 percent, while gross margin grew to 51.5 percent from 51.3 percent a year ago.

Total net sales were 6.24 billion euros, down from 6.90 billion euros a year ago.

Net system sales declined to 4.76 billion euros from last year's 5.61 billion euros, while net service and field option sales increased.

Quarterly sales of lithography systems dropped to 100 units from last year's 113 units. However, value of booked systems grew to 5.57 billion euros from 4.50 billion euros a year ago.

In pre-market activity on the Nasdaq, ASML shares were losing around 7.02 percent to trade at $993.25.

In Amsterdam, ASML shares were trading at 910.90 euros, down 6.84 percent.

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