The chip equipment manufacturer ASML expects a profit margin of at least 60% until 2030, and the stock rises.

Dutch chip manufacturing equipment company ASML Holding NV confirmed its ambitious revenue expectations for the years ahead on Thursday, targeting annual revenues between €44 billion and €60 billion with a gross profit margin between 56% and 60%, contradicting the company's recent profit warning.

Ahead of the 2024 investor day, ASML reaffirmed its confidence in extreme ultraviolet (EUV) lithography technology as a growth driver over the next decade, noting that it would be the largest contributor to enhancing its profits.

ASML's CEO, Christoph Wyeche, highlighted the role of the company's printing technology in supporting the growing demand for artificial intelligence (AI) chips, positioning ASML to capitalize on the increasing applications of AI.

ASML anticipates that global demand for semiconductor chips will increase industry revenues to over $1 trillion by 2030, which would translate to an annual growth rate of around 9% starting in 2025.

Currently, analysts based on FactSet data expect ASML – which supplies equipment to major chipmakers like TSMC – to generate revenues of around €32.5 billion for the entire year of 2024.

The announcement from ASML comes after the company recently faced a significant setback when it inadvertently released its third-quarter results ahead of schedule, revealing weaker-than-expected demand and lower projections for 2025.

However, ASML remains optimistic about continued growth in demand for its equipment, expecting the global semiconductor market to steadily expand towards a trillion dollars by the end of the decade.

In trading, ASML's shares listed on the Amsterdam Stock Exchange (ASML.AS) jumped 5.3% during today’s session, reaching a share price of €660.75, as today’s announcement indicates that ASML views the expected revenue decline in 2025 as a temporary setback rather than a fundamental issue.