ASML Struggles In Wednesday Pre-Market As Nvidia, AMD And Other Peers Begin Recovery From Chipmaker's Downward Pull

Amid a turbulent week for the semiconductor sector, ASML Holding N.V. ASML faced a 3.9% decline in pre-market trading on Wednesday. This follows a significant 16.26% drop on Tuesday’s close, attributed to an accidental early release of its third-quarter earnings report. The report disclosed a reduced sales forecast for 2025, which negatively impacted the semiconductor industry and pulled peers downward.

What Happened: According to Benzinga Pro, while ASML struggled, other semiconductor companies showed signs of recovery. Nvidia Corp. NVDA experienced a 0.70% increase in pre-market trading after a 4.69% decline on Tuesday. Similarly, Advanced Micro Devices, Inc. AMD rose by 0.39% following a 5.22% drop.

Broadcom Inc. AVGO and Taiwan Semiconductor Mfg. Co. Ltd. TSM also saw positive movements. Broadcom increased by 0.40% after a 3.47% fall, and Taiwan Semiconductor rose 0.89% after a 2.63% decline.

ASML’s CEO mentioned a gradual recovery and cautious customer sentiment, while CFO Roger Dassen projected China’s contribution to ASML’s revenue to normalize at 20% next year, down from 49% in the June quarter. The semiconductor sector also faced pressure from potential U.S. restrictions on AI chip sales, as reported by Bloomberg.

Why It Matters: The semiconductor sector experienced a sharp reaction following ASML’s guidance cut for 2025, which led to a broader sell-off in AI hardware stocks. According to Gene Munster from Deepwater Asset Management, the market’s response was an overreaction. He noted that only about 10% of ASML’s revenue is tied to AI demand, with a significant portion stemming from its extreme ultraviolet lithography machines essential for AI chip production.

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