ASML's lowered outlook suggests factory overcapacity, not chip doom

Computer chip equipment maker ASML's deep cuts to its 2025 sales forecast sparked a sell-off in chip stocks on Tuesday over worries that global chip demand may be faltering. The weaker outlook could, instead, reflect some overcapacity at chip factories that had already stocked up on ASML's pricey tools during the pandemic and have become better at using them to produce a larger numbers of chips, analysts said. In results that the company inadvertently posted a day ahead of schedule, ASML said it expects 2025 total net sales of 30 billion-35 billion euros, near the bottom of its previous forecast.