By Nathan Vifflin
(Reuters) -Computer chip equipment maker ASM International cut its revenue target for the second half of 2025 ahead of an investor day event on Tuesday, saying it expected demand for its most advanced machines to drop towards the end of the year.
Shares in ASM were down 0.8% in mid-morning trading, recouping losses after falling by as much as 6.4% earlier.
The Dutch company anticipates second-half revenue will be 5% to 10% lower compared to the first half of 2025 at constant currency rates. It had previously expected revenue in the second half to be flat compared with the first half.
ASM said it expects a fourth-quarter revenue drop as demand for advanced chipmaking tools was lower than expected and uneven among customers, despite the third quarter being in line with its guidance.
WEAK SALES OUTLOOK MAY REFLECT CUSTOMERS’ WEAKNESS -ANALYST
Degroof Petercam analyst Michael Roeg said he was surprised by the weak sales outlook as TSMC, the world’s largest contract chipmaker, was rolling out its latest manufacturing process using ASM’s tools.
“This could be the result of weaknesses of ASM’s other major customers, Intel and Samsung,” Roeg said.
ASM said its updated guidance implied full-year revenue growth to be at the lower end of its 10% to 20% range. It reported 12% revenue growth in 2024 to 2.93 billion euros ($3.46 billion.
The lower demand will also impact order bookings, with ASM saying it will book fewer orders than it will bill in sales in the rest of the year, weighing on growth expectations for 2026.
ING analyst Mark Hesselink said he expected weaker bookings to be a timing issue of orders, rather than a structural problem.
ASM ADJUSTS 2027 REVENUE TARGETS DUE TO WEAK DOLLAR
The company also laid out its financial targets for 2030, anticipating revenue to increase to more than 5.7 billion euros, with compound annual growth rate of at least 12%, and operating margin to exceed 30%.
ASM said its advanced chipmaking technology, Atomic Layer Deposition, will remain its primary growth driver until 2030.
It lowered its 2027 revenue target to account for currency effects to a range of 3.7 to 4.6 billion euros, compared with 4 to 5 billion euros previously, while raising the operating margin range to 28-32% from 26-31%.
Analysts polled by LSEG expected revenue at 4.12 billion euros.
(Reporting by Nathan Vifflin in Gdansk; Editing by Matt Scuffham, Anna Pruchnicka and Bernadette Baum)
