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Dutch semiconductor equipment giant ASML (Nasdaq: ASML) reported third quarter results that largely met its internal guidance. Revenue grew 25% to 6.7 billion euros (about $7.1 billion USD) and earnings per share were up 12% 4.81 euros ($5.07).

Yet the stock was selling off around 5% on Wednesday morning trading, likely due to tepid forward guidance. ASML announced only 2.6 billion euros in upcoming bookings, which is a stark decline from the 8.9 billion euros of forward bookings at this time last year.

That indicates that the semiconductor industry at-large might be cooling down next year. 2023 was a year marked by euphoria for artificial intelligence, which called for new fabs built on multiple continents to keep up with the thirst for cutting-edge chips.

Yet between higher interest rates, a possible global recession, and a fresh new ban from the US on chips that can’t be shipped to China, it’s quite likely that the upcoming year’s sales will be a bit more lukewarm.

ASML CEO Peter Wennink commented on his company’s forward guidance:

The semiconductor industry is currently working through the bottom of the cycle and our customers expect the inflection point to be visible by the end of this year. Customers continue to be uncertain about the shape of the demand recovery in the industry. We therefore expect 2024 to be a transition year.

Based on our current perspective, we take a more conservative view and expect a revenue number similar to 2023. But we also look at 2024 as an important year to prepare for significant growth that we expect for 2025 .