Disappointing forecast and possible U.S. export cap cause Asian chip stocks to decline.

• On Wednesday, Asian chip stocks declined due to disappointing sales projections from Dutch semiconductor equipment manufacturer ASML, which caused a drop in global stock prices in the sector.
• Tokyo Electron, a Japanese semiconductor manufacturing company, experienced the largest losses with a nearly 10% drop in share price.
• The decline in the semiconductor sector in the region led to a drop in major indexes, with Japan's Nikkei 225 losing over 2%, South Korea's Kospi falling 0.6%, and the Taiwan Weighted Index sliding 0.7%.

On Wednesday, Asian chip stocks declined due to disappointing sales projections from Dutch semiconductor equipment manufacturer ASML, which caused a drop in global stock prices in the sector.

Japanese semiconductor manufacturing firm logged the biggest losses, dropping nearly 10%, while fell over 3%, and a testing equipment supplier dipped 0.8%.

Foxconn, a company known internationally, experienced a decline of up to 3.3% and 1.6%, respectively.

SK Hynix, a South Korean chipmaking giant that produces high bandwidth memory chips for Nvidia's AI applications, experienced a 1.6% decline in stock price. In contrast, Samsung Electronics, the world's largest manufacturer of dynamic random-access memory chips, saw its shares drop by 1.9%.

The decline in the semiconductor sector in the region led to a drop in major indexes, with Japan's Nikkei losing more than 2%, the S&P 500 dipping 0.6%, and the TSX sliding 0.7%.

ASML, a Dutch semiconductor equipment manufacturer, announced that it anticipates its net sales for 2025 to fall within the range of 30 billion euros to 35 billion euros ($32.7 billion to $38.1 billion), which is the lower half of its previous estimate.

The company reported net bookings of 2.6 billion euros ($2.83 billion) for the September quarter, which was below the 5.6 billion euro LSEG consensus estimate. Despite this, net sales came in at 7.5 billion euros, surpassing expectations.

The CEO of the company cautioned customers about their behavior and stated that the recovery process would take longer than anticipated.

The decline in ASML's stock price by 16% led other global chipmakers, including Nvidia and AMD, to also experience a drop in their stock prices by 4.7% and 5.2%, respectively.

On Tuesday, Bloomberg reported that Biden administration officials had discussed limiting sales of advanced AI clips from Nvidia to certain countries in the interest of national security, further dampening investor sentiment around the semiconductor sector.

Due to U.S. and Dutch export restrictions, ASML has encountered a more challenging business environment in China.

CFO Roger Dassen stated on Tuesday that he anticipates the company's China business will exhibit a "more typical proportion in our order book and also in our business."

According to ASML's June-quarter earnings presentation, 49% of its sales come from China.

— Ryan Browne contributed to this story.