Shares in the semiconductor equipment manufacturer ASML fell 15.6% on Tuesday after the Dutch company issued disappointing sales forecasts a day earlier.

The move dragged other chip stocks lower, along with it NvidiaAdvanced Micro Devices and Broadcom all fell at least 4% following the news.

ASML expects net sales of between 30 and 35 billion euros (32.7 and 38.1 billion US dollars) for 2025, in the lower half of the previously stated range.

Net bookings for the September quarter were 2.6 billion euros ($2.83 billion), the company said, well below the LSEG consensus estimate of 5.6 billion euros. However, net sales were above expectations at 7.5 billion euros.

“While there continues to be strong developments and upside potential in the AI ​​space, the recovery in other market segments is taking longer. It now appears that the recovery is slower than previously expected,” the company’s CEO Christophe Fouquet said in the earnings release.

ASML said the early release of its findings was due to a technical error that caused the report to be erroneously published on part of its website.

Ahead of the earnings release, Wall Street analysts had become more cautious about the chip maker, which is a key supplier to the entire semiconductor industry.

The company faces a more difficult business outlook in China due to US and Dutch export restrictions on shipments to the country.

Last month, the U.S. government imposed new export controls on critical technologies to China, including advanced chip-making tools. Separately, the Dutch government announced plans to take control of the export of ASML machines to the country.

ASML's extreme ultraviolet lithography (EUV) machines are used by many of the world's largest chipmakers – from Nvidia to TSMC – to produce advanced chips.

The company's chief financial officer, Roger Dassen, said Tuesday he expects the company's China business to be a “more normal percentage in our order book and also in our business.”

“We are seeing a trend in China toward historically normal percentages in our business,” Dassen said, according to a transcript of a video also posted a day earlier.

“We therefore expect China to account for around 20% of our total sales next year. That would also correspond to its share in our order backlog.”

In its June quarter earnings presentation, the Dutch company said 49% of its revenue was generated in China.

In a note issued following ASML's results on Tuesday, analysts at Bernstein said the company's weaker-than-expected backlog and a disappointing outlook for 2025 are “likely to overshadow the strong third quarter results.”

The analysts added that ASML's lowered forecast suggests that “delayed cyclical recovery and specific customer challenges are weighing heavily on 2025 expectations.”

Analysts at Cantor, meanwhile, said ASML's poor outlook was “clearly disappointing” and would weigh on semiconductor stocks. However, they added that “the company's updated outlook in no way suggests a change in the AI ​​growth story.”