Why ASML Is Falling Despite a Q1 Profit Beat [Video]

American depositary receipts (ADRs) of ASML Holding (ASML) fell in intraday trading Wednesday following the release of a first-quarter earnings report that beat income estimates but fell short of sales expectations.

The Dutch company manufactures equipment used in the construction of semiconductors, and supplies some of the largest semiconductor companies in the world like Samsung, Taiwan Semiconductor Manufacturing Company (TSM), and Intel (INTC).

ASML posted 5.29 billion euros ($5.63 billion) in total sales for the first quarter of 2024, below estimates compiled by Visible Alpha of EUR5.42 billion ($5.77 billion). Net income, however, surpassed expectations, with ASML reporting profit of EUR1.22 billion ($1.30 billion), or earnings per share (EPS) of EUR3.11 ($3.31), topping estimates of EUR1.11 billion ($1.18 billion), or EUR2.83 per share ($3.01).

Chief Executive Officer (CEO)Peter Wennink said the company still sees 2024 as a “transition year,” with plans to continue investing in increased production capacity …