The semiconductor company cannot confirm growth in 2026, as customs threats are still weaving.

ASML (NASDAQ: ASML) Equity fell Wednesday, down approx. 8%, despite having a pretty solid quarter.

It was not so much the previous results that were of concern, rather it was overcast 2026 views.

ASML is a Holland-based semiconductor stock that builds equipment and machines used to produce AI Semiconductor chips. As such, it is a key player in the AI chip supply chain for companies such as Nvidia (Nasdaq: NVDA).

As mentioned, it was a solid second quarter for ASML when it struck revenue and earnings estimates. The company generated $ 7.7 billion. EUR in net sales, which is about USD 8.95 billion USD. It had fallen approx. 24% year over year and down approx. 0.6% from Q1. It also beat estimates of $ 7.5 billion. EUR in sale.

Net income was also strong as the company earned $ 2.3 billion. EUR or € 5.90 per It also peaked estimates of $ 2.0 billion. EUR.

The gross margin improved to 53.7%, up from 51.1% a year ago, but down slightly from 54% in 1st quarter. The gross margin is revenue made after subtracting sales costs.

Also impressive was its net bookings of 5.5 billion. EUR, up from £ 3.9 billion EUR in 1st quarter. Net bookings include all sales orders already contracted.

“Our total net sales in the second quarter came at EUR 7.7 billion at the top end of our guidance. The gross margin was 53.7%, over guidance, primarily driven by higher upgrading and disposable, resulting in lower costs,” said Asml president and CEO Christophe Fouquet.

Outlook clouded by customs rates

Sales Wednesday was probably due to the prospects.

It is not so much the prospect of the rest of 2025 that is disturbing. In the third quarter, ASML expects net sales between DKK 7.4 billion. EUR 7.9 billion EUR, which would be about in line with sales in 2nd quarter. The gross margin is targeted to fall between 50% and 52% – which would be slightly down from the 2nd quarter.

For the full financial year, net sales are expected to increase by approx. 15% with the gross margin that is expected to be about 52%. It would be a faster growth rate for sales than the year before.

The greater concern is its prospects of 2026, which is flooded by tariffs and other macroeconomic and geopolitical problems – which could have both direct and indirect effects.

“With regard to customs, the result of the direct consequences of customs related to system sales to our customers in the US, import of materials to our US production facilities, imports of parts and tools for our US field operations and exports of parts from the US to other countries to the extent that tariffs should apply to these parts,” CFO Roger Dassen said about the earnings. Searching alpha.

Unable to confirm growth rates in 2026 due to uncertainty

While the company works with customers and suppliers to limit the direct effect of tariffs, the indirect effect is difficult to determine because it relates to their effect on GDP and the market demand.

“Nobody knows even today what is the end mode [with tariffs]”Said Fouquet.” Some people become more optimistic. Some people get more pessimistic. And I think when we talk about uncertainties, we both mean fundamentally. So I think our visibility due to discussion is a little reduced and therefore we are more cautious. ”

It is because of the uncertainty and lack of visibility that ASML cannot make any growth projections around 2026.

“If we look at 2026, we see that our AI customers’ basic elements remain strong,” Fouquet said. “At the same time, we still see increasing uncertainty driven by macroeconomic and geopolitical development. Therefore, while we are still preparing for growth in 2026, we cannot confirm it at this time.”

The ASML share had had a solid year until Wednesday’s sale. Still, it’s still up 8% YTD.

The stock is still quite expensive trade in 31 times earnings, so this can bring it down to a more reasonable valuation. If there is some decision in Tariff Wars, it would be a good idea to revise the ASML share as it has been a strong growing in a thriving industry.