After disclosing that it would discontinue quarterly order reporting starting in the second quarter of 2025, ASML executives highlighted in their latest earnings call that tariff uncertainty is hindering their ability to forecast full-year impact amid US chip reshoring efforts. Despite this, ASML anticipates China to represent over 25% of its 2025 sales, driven by DUV system demand and a diversifying customer base beyond top chipmakers.
ASML urges tariff clarity, to pass cost to US customers
On April 16, 2025, ASML executives voiced concern over ongoing tariff uncertainty during the company's latest earnings call, citing challenges in estimating the full-year impact of trade measures while expressing cautious optimism about recent US exemptions.
CFO Roger Dassen said it remains "absolutely impossible" to forecast the full-year gross margin impact of tariffs, given the unclear scope and timeline of US trade decisions. Although ASML widened its margin range for the current quarter to account for potential tariff effects, Dassen emphasized that any final tariff burden should not fall solely on ASML. Instead, the company is working closely with ecosystem partners to minimize exposure, with the expectation that downstream players in the semiconductor value chain will shoulder most of the costs.
"But we also believe that the burden of that should not be with ASML, that the burden of the tariff, and that the next element in the value chain should bear the lion's share of the tariff burden. I think that's the way we approach it," said Dassen.
CEO Christophe Fouquet acknowledged growing frustration over US policy, which promotes domestic chip production but imposes tariffs on crucial foreign tools like ASML's systems. He suggested that many products are now exempt from tariffs as the US begins to recognize the challenge of reshoring without harming supply chains. Fouquet said both the industry and the US government are working to resolve this tension.
ASML sees China sales rising, customer base diversifying
In the earnings call, ASML expects China to account for slightly over 25% of its total sales in 2025, up from the low 20s previously projected, according to Dassen. The increase is driven by shifting demand for deep ultraviolet (DUV) lithography systems. Dassen also noted that China's share in ASML's order backlog remains steady, at roughly 20–25%.
In a follow-up discussion, ASML executives confirmed that while the top domestic chipmakers in China still represent a large portion of its business, the customer base is expanding. "The tail in China has become longer," said Dassen, referring to a growing number of smaller Chinese customers. Despite this diversification, the majority of shipments to China still go to the leading players, given the smaller scale of orders from emerging firms.
These remarks highlight ASML's deepening presence in the Chinese market amid evolving demand patterns and geopolitical scrutiny over advanced chipmaking equipment sales.
ASML adds three High NA EUV customers
ASML provided a detailed update on its extreme ultraviolet (EUV) lithography systems during its latest earnings call, emphasizing advancements in both High NA and Low NA platforms as key semiconductor customers move forward with adoption.
Fouquet highlighted growing momentum for High NA EUV, noting that Intel had already exposed over 30,000 wafers in a single quarter, achieving a dramatic reduction in process steps—from 40 to fewer than 10—on a single layer. Samsung also reported a 60% cycle time improvement in one use case.
ASML shipped its fifth and final EXE:5000 High NA system in the first quarter and will begin delivering the follow-on EXE:5200 from the second quarter. Customers are currently in the R&D-focused Phase 1 of adoption, with pilot production (Phase 2) expected between 2026 and 2027, followed by volume production (Phase 3) on critical layers at advanced nodes.
On the Low NA front, ASML's NXE:3800E systems are now shipping at full specification, achieving 220 wafers per hour—30% faster than the previous-generation NXE:3600. Upgrades across the installed base are underway and will continue into late 2025. Fouquet said tool maturity is now supporting high-volume production at advanced logic and memory nodes, with no concerns about selling remaining NXE:3600 systems.
Dassen confirmed that the average selling price (ASP) for Low NA EUV came in at EUR227 million (US$258.8 million), slightly above the expected range due to product mix. He advised modeling a blended ASP closer to EUR220 million going forward. Gross margins for Low NA systems remain above ASML's corporate average, although exact figures were not disclosed.
ASML maintains growth outlook through 2026, citing strong AI-driven demand
ASML remains optimistic about growth through 2026, driven by sustained demand for chips supporting artificial intelligence and high-performance computing. CFO Roger Dassen declined to specify expected bookings for the coming quarters but noted that the current backlog already includes significant orders beyond 2025. He emphasized that additional bookings will be needed to support 2025 growth, though the existing pipeline provides a solid foundation.
Dassen reaffirmed that 2026 is also expected to be a growth year, citing ongoing customer conversations and strong underlying technology trends. However, he cautioned that macroeconomic factors could still influence outcomes.
CEO Christophe Fouquet echoed the confidence in near-term demand, pointing to committed investments by chipmakers and their customers in AI infrastructure. He said these commitments reflect a broader industry belief in the necessity of participating in the AI race, which continues to drive major capital spending. While Fouquet acknowledged it's too early to predict 2027 with certainty, he said the current investment climate suggests strong momentum through at least 2026.
Article edited by Jerry Chen
