ASML Holding NV (NASDAQ:ASML) delivered strong Q4 2024 results, sending its stock up more than 10% on Wednesday as investors reacted positively to better-than-expected bookings, strong AI-driven chip demand, and a reaffirmed 2025 outlook. The report reinforces ASMLs pivotal role in the semiconductor supply chain, particularly as AI adoption continues to fuel demand for cutting-edge chip-making equipment.

This surge comes after Mondays market sell off, when concerns over Chinese AI chip startup DeepSeek weighed on sentiment. DeepSeek recently introduced a low-cost AI model designed to reduce computational power needs, sparking speculation that it could impact demand for high-end chips requiring ASMLs extreme ultraviolet (EUV) lithography systems.

ASML reported Q4 2024 net sales reached 9.3 billion ($9.8 billion), bringing full-year 2024 revenue to 28.3 billion ($29.7 billion). The companys net bookings came in at 7 billion ($7.4 billion), with 3.0 billion ($3.2 billion) attributed to EUV systemsASMLs most advanced technology, essential for next-generation AI and high-performance computing chips.

ASML maintained a healthy 51.7% gross margin in Q4, contributing to a full-year margin of 51.3%. Net income for 2024 stood at 7.6 billion ($8 billion), with earnings per share (EPS) of 19.25 ($20.2). ASML also returned 3.0 billion ($3.2 billion) to shareholders through dividends and buybacks.

Looking ahead, ASML guided for Q1 2025 net sales between 7.5 billion and 8.0 billion ($7.9B$8.4B), with a projected gross margin of 52%53%. The company reaffirmed its full-year 2025 revenue outlook between 30 billion and 35 billion ($31.5B$36.8B), reflecting confidence in continued demand for its EUV and deep ultraviolet (DUV) lithography machines.