Major semiconductor supplier ASML faces investor lawsuit after 16% stock plunge
New York, Wednesday, 27 November 2024.
ASML Holding N.V., the leading semiconductor equipment manufacturer, faces a class action lawsuit after its stock value dropped more than 16% in October 2024. The legal action stems from disappointing third-quarter results, where bookings plummeted 53% to €2.63 billion. Multiple law firms are now rallying investors who lost over $100,000 to join the lawsuit before January 13, 2025. The complaint alleges ASML misled shareholders about semiconductor industry challenges and export control impacts. The company shocked markets by cutting its 2025 sales forecast and reducing profit margin targets. This legal battle marks a significant challenge for the Dutch tech giant as it grapples with slower industry recovery and declining Chinese sales.
impact on market position
The lawsuit raises concerns about ASML’s ability to maintain its market leadership. As a major supplier of photolithography machines, ASML’s technology is crucial for semiconductor manufacturing. The company’s reduced sales and margin forecasts have sparked fears about its competitive position. Investors are particularly worried about ASML’s exposure to the Chinese market, which has been a significant revenue source but is now threatened by new export controls.
order book and financial outlook
ASML’s order book has seen a sharp decline, with bookings falling from €5.6 billion in the second quarter of 2024 to €2.63 billion in the third quarter[1]. This drop has led the company to adjust its full-year sales forecast to between €30 billion and €35 billion, down from previous estimates of up to €40 billion. The gross margin target has also been reduced to 51%-53%, reflecting the challenges in the semiconductor market[2].
expert views on technological leadership
Market experts suggest that ASML’s technological leadership remains intact despite financial setbacks. The company’s advanced photolithography systems are critical to the semiconductor industry’s future. However, the slow recovery in traditional end markets and cautious customer spending pose ongoing challenges. ASML executives acknowledge the need for strategic adjustments to navigate these turbulent times and maintain their technological edge[3].
legal proceedings and investor actions
The class action lawsuit, filed in the U.S. District Court for the Southern District of New York, accuses ASML of violating federal securities laws by failing to disclose material information[4]. Investors have until January 13, 2025, to join the lawsuit. Multiple law firms, including Robbins Geller Rudman & Dowd LLP and Levi & Korsinsky, are involved in representing affected shareholders. These legal actions highlight investor frustration over the company’s handling of market challenges[5].