(Oct 30): ASM International NV's orders beat estimates in the third quarter (3Q) as the artificial intelligence (AI) boom drives demand for the Dutch firm's advanced chipmaking tools.

Orders increased 30% from a year earlier to €815.3 million (RM3.85 billion), ASM said in a statement on Tuesday. That compared to an average analyst estimate of €768 million in a Bloomberg survey.

ASM saw strong demand in particular for technology critical to AI chips. Its so-called gate-all-around products, which boost device performance, are expected to see a “substantial increase” in sales next year, chief executive officer Hichem M'Saad said in the statement.

Sales in China also “held up slightly better than expected” in 3Q, M'Saad said, after the company had previously warned that sales in the market would drop off in the second half of the year. The company still expects weaker demand from the Asian nation in the final three months of the year, he said.

ASM's shares jumped as much as 8.1% to €558.20 in Amsterdam trading on Wednesday, the most in three months. The stock has gained about 16% so far this year.

ASM said it expects a revenue of €770 million to €810 million in the fourth quarter and its orders to fall compared to the previous three months. Full-year revenue is expected to grow 10% in 2024 compared to last year.

Almere-based ASM's shares took a hit earlier this month after its compatriot ASML Holding NV cut its outlook. The bigger Dutch company reported orders for its advanced chipmaking machines had dramatically missed analysts' estimates in the third quarter, sparking a broad selloff in the industry. ASML had also cited uncertainty over future sales to China and CEO Christophe Fouquet predicted pressure on US allies that would lead to more restrictions on tech going into the country.

M'Saad said sluggish recovery in personal computers and smartphones and a “a cyclical downturn” in automotive and industrial segments were weak spots in the market.

Even as companies like Taiwan Semiconductor Manufacturing Co are getting a boost from the AI ​​boom, other players in the chip sector, including automotive and industrial semiconductor makers, are facing a difficult period as clients with surplus inventory cut orders.

Intel Corp has delayed planned European plants due to financial struggles, while Samsung Electronics Co issued an apology to investors this month for its disappointing results.

Uploaded by Felyx Teoh