The lithography giant Asmack has collapsed! Analysts warn that the performance of LRCX.US (LRCX.US) and KLAC.US (KLAC.US) may be affected by the slowdown in Chinese demand

Zhitong Finance learned that on Tuesday local time, lithography giant ASML.US (ASML.US) unexpectedly released the earnings report scheduled to be released on Wednesday ahead of schedule. To make matters worse, since the Q3 order data was only half of market expectations, the combined reduction of the FY2025 guidance also triggered a sharp drop in stock prices, dragging down the entire semiconductor sector and the US stock market. Raymond James said that KLAC.US (KLAC.US) and LRCX.US (LRCX.US) may both face the impact of falling demand from China in the short term. Kerei's stock price closed down 14.7% on Tuesday, and Ram Research's stock price closed down 10.9% on Tuesday. Asmack's stock price also plummeted 16.26% on Tuesday.

According to Asmack's official earnings schedule, the company will release the financial report on Wednesday morning (Wednesday afternoon Beijing time) and hold a conference call to interpret it. However, at around 22:30 on Tuesday evening Beijing time, various financial terminals simultaneously caught the company's financial reports accidentally posted online.

According to data released in advance, Asmack announced that orders for the third quarter of this year were only 2.6 billion euros, which is nearly half of the 5.4 billion euros expected by the market. The company expects total net sales to grow to between €30 billion and €35 billion by 2025 (previous guidance was €30-40 billion), a figure in the lower half of the guidance provided by Investor Day 2022. The gross margin ranged from 51% to 53%, below the range offered at the time.

Subsequently, Raymond James analyst Srini Pajjuri lowered Ke Lei's target price from $975 to $925. However, the investment company still maintained an “outperforming market” rating for the stock. Pajjuri said in an investor report that in the past five years, Kelei's revenue has surpassed wafer manufacturing equipment, and this trend is expected to continue due to long-term growth in process control intensity.

However, Raymond James's forecast for 2025 was slightly lowered because “the company has investments in fabs and mask plants in China, and it believes that construction of these plants is still in the early stages.” Pajuri pointed out that advanced foundry and logic are also constantly being improved, and the 2nm node will be a key driver for Kelei.

Second, Pajjuri also lowered Ram's research target price from $125 to $100, but the company maintained an “overweight” rating on the stock. The agency indicated that demand for DRAM chips in China is expected to slow in the near future.

Pajjuri said, “Despite this, Raymond James believes that the valuation has underestimated some of the risks in the near future outlook, and continues to be optimistic about Rahm Research's progress in HBM growth and foundry/logic (64% of Q4 system sales).” According to Raymond James, increased utilization of NAND flash memory is expected to lead to a recovery in wafer manufacturing equipment in 2025.