ASML, a major supplier to semiconductor makers, on October 14 reported a rise in third-quarter earnings that fell short of forecasts and a bigger than expected fall in new orders. The company said some chipmakers were either slowing investments or expect to grow less quickly and ASML would ship fewer of its newest generation of machines this year than initially expected.
The company's net profit of 322 million euros ($367 million) rose 32 percent from 244 million in the same period a year ago. Revenues increased 17 percent to 1.55 billion euros.
Analysts polled by Thomson Reuters had forecast net income of 324 million euros on revenues of 1.58 billion euros.
New bookings were 904 million euros, against 1.4 billion in the same quarter a year ago, and compared with analyst forecasts of 1.04 billion euros.
"We believe that the slowdown in the semi-cycle will not be a surprise to the market, but still we believe that this is worse than expected," analysts from ABN Amro said in a note on the earnings.
ASML, the world's second-largest chip manufacturing equipment maker, makes lithography systems, machines that cost tens of millions of euros each and are used by chipmakers to make circuitry.
CEO Peter Wennink said that compared to three months ago, foundry customers were slightly more cautious with their investment plans.
So-called foundries make chips to order for tech companies. ASML's foundry customers include the two largest, Taiwan Semiconductor Manufacturing Co and GlobalFoundries.
Wennink said that while shipments to logic chip makers, such as Intel, were down, he expected them to ramp up production in the second quarter of 2016.
The CEO said demand from memory chip makers would continue to be strong well into 2016, though below the level of the first 9 months of 2015.