ASML Holding NV (ASML), the world's largest supplier of chip-making equipment, saw its shares plunge 5.75% in pre-market trading on Wednesday. The significant drop comes as the Dutch semiconductor giant faces a perfect storm of challenges, including disappointing first-quarter orders and growing uncertainty surrounding U.S. tariffs.

ASML reported net bookings of 3.94 billion euros ($4.48 billion) for the first quarter, falling well short of analysts' expectations of 4.89 billion euros. This underwhelming performance has raised concerns about potential softening demand in the chip equipment sector. Adding to the pressure, the company issued cautious guidance for the second quarter, projecting sales between 7.2 billion and 7.7 billion euros, below the market consensus of 7.8 billion euros.

CEO Christophe Fouquet acknowledged the growing uncertainty in the company's outlook, stating, "Our conversations so far with customers support our expectation that 2025 and 2026 will be growth years. However, the recent tariff announcements have increased uncertainty in the macro environment and the situation will remain dynamic for a while." The company is actively working to minimize the impact of tariffs on its systems and component shipments, but the full extent of the consequences remains unclear.

ASML's stock decline is part of a broader selloff in the semiconductor sector, as investors grapple with the potential fallout from escalating trade tensions and new export restrictions. The company's performance is closely watched as a bellwether for the global chip industry, and its current challenges may signal broader headwinds for the sector. Despite the setbacks, ASML maintains its full-year 2025 sales guidance of 30-35 billion euros, indicating some resilience in its long-term outlook amid the current turbulence.