ASML Holding’s Bookings Soar in Fourth Quarter

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By Brian Nelson, CFA

On January 29, ASML Holding (ASML) reported better than expected fourth quarter results with revenue and GAAP earnings per share coming in ahead of the consensus forecasts. Fourth quarter net sales totaled €9.3 billion on a gross margin of 51.7%, with net income coming in at €2.7 billion. Management had previously guided net sales to be between €8.8 billion and €9.2 billion with a gross margin between 49% and 50% in the quarter. Net sales advanced 24.1% on a sequential basis, and net bookings were €7.1 billion, up considerably on a sequential basis when compared to the €2.6 billion it registered during the third quarter of 2024.

Management had the following to say about the results:

Our fourth-quarter was a record in terms of revenue, with total net sales coming in at €9.3 billion, and a gross margin of 51.7%, both above our guidance. This was primarily driven by additional upgrades. We also recognized revenue on two High NA EUV systems. We shipped a third High NA EUV system to a customer in the fourth quarter. ASML achieved another record year, ending with total net sales for 2024 of €28.3 billion, and a gross margin of 51.3%.

We expect first-quarter total net sales between €7.5 billion and €8.0 billion, with a gross margin between 52% and 53%. ASML expects R&D costs of around €1,140 million and SG&A costs of around €290 million. As we communicated last October, we expect total net sales for the year between €30 billion and €35 billion, with a gross margin between 51% and 53%.

Consistent with our view from the last quarter, the growth in artificial intelligence is the key driver for growth in our industry. It has created a shift in the market dynamics that is not benefiting all of our customers equally, which creates both opportunities and risks as reflected in our 2025 revenue range

We continue to like ASML as an idea in the ESG Newsletter portfolio, and the company’s bookings number for the fourth quarter was solid, helping to alleviate some concerns that arose by its weak third-quarter bookings result. The company’s first-quarter outlook for net sales came in ahead of what the Street was looking for, and we liked that ASML reiterated its total net sales expectation for 2025 to be between €30 billion and €35 billion.

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