ASML expects limited impact from U.S. chip restrictions on China

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ASML Holding NV (AMS: ASML) is in the green this morning after the semiconductor-equipment maker reported better-than-expected results for its fiscal third quarter on strong demand.

ASML Q3 financial highlights

ASML earned €1.70 billion ($1.68 billion) versus the year-ago €1.71 billion. Net sales climbed just over 10% this quarter to €5.78 billion. According to FactSet, experts had forecast €1.51 billion profit on €5.1 billion in sales.

Gross margin improved 10 basis points to 51.8% in Q3.

More importantly, ASML said it does not expect a meaningful hit to its business from recent restrictions the U.S. announced on export of sophisticated chips to China. On CNBC’s “Squawk Box Europe”, Citi’s Amit Harchandani said:

Over a long period of time, this should all shake itself out. So, we believe companies like ASML are still very well-positioned because structural trends are there in terms of driving increases in data consumption, digital transformation and the like.

ASML’s full-year outlook and dividend

For the full financial year, ASML forecasts €21.1 million in sales.

Also on Wednesday, the company’s board declared €1.37 a share of interim dividend. In the earnings press release, CEO Peter Wennink said:

There’s uncertainty in the market due to global macroeconomic concerns. While we’re starting to see diverging demand dynamics per market segment, the overall demand for our systems continues to be strong.

The U.S. listed shares of ASML NV are currently down more than 45% for the year, which, as per Wall Street, is a great opportunity to invest in this stock.

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