ASML Q2 results beat expectations, increasing tech costs for consumers
Commenting on the latest ASML quarterly results, James Bull, Technology Industry Senior Analyst, RSM UK said: "If you are planning to buy a new laptop, tablet or iPhone this Christmas, this morning's ASML results are significant, and not in a good way. The price of consumer technology is rising, the shortage driving those increases is getting worse, and there is very little British consumers can do to avoid it. The cost of building the global AI economy is now landing firmly with UK consumers.
"UK consumers are already feeling the impact. Apple increased prices on its Mac and iPad range by between 15% and 25% last month and has signalled that iPhones may follow. That is not a one-off, and unlike interest rates is unlikely to come down. The memory chips being prioritised for AI data centres are the same chips inside every laptop, tablet and smartphone on the high street.
“ASML, the company that makes the machines used to print the world's most advanced chips reported revenues of €9.3bn, beating market expectations, and at the same time raised its full year outlook by €5bn in a single quarter.
“The four largest US technology companies are forecast to spend $725bn on AI data centres in 2026 and every dollar spent on AI infrastructure competes directly with the supply of memory chips available for consumer devices. ASML's machines take up to three years from order to producing chips, so more demand today means more chips in 2029, not 2026. A €5bn guidance upgrade in a single quarter provides strong evidence that the AI buildout is not slowing down, and that the chip shortage will run longer as a result.
“If the AI buildout continues at this pace, which this morning's results suggest it will, technology price inflation risks becoming a persistent and largely overlooked contributor to the UK's inflation challenge. For the Bank of England, already navigating above target inflation, an energy price cap that rose 13% this month and an oil price volatility driven by events in the Middle East, a structural squeeze on consumer technology prices driven by forces entirely outside of UK policy control is an unwelcome addition, and one that appears to have further to run."