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New bookings far ahead of expectations

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CEO says AI remains the driver of growth for computer

industry

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China sales fall to 27% of total in Q4

(Adds analyst comment, details of earnings in paragraphs 5-9.

Recasts first paragraph.)

By Nathan Vifflin and Toby Sterling

Eindhoven, NETHERLANDS, Jan 29 (Reuters) - Shrugging off

fears prompted by Chinese AI firm DeepSeek, Dutch computer chip

equipment maker ASML on Wednesday reported better than

expected fourth-quarter bookings of 7.088 billion euros ($7.39

billion), on strong demand for its advanced tools.

Analysts had predicted bookings at 3.99 billion euros,

according to polling by Visible Alpha, an increase from 2.63

billion euros in the third quarter of 2024.

The large order influx may reassure ASML and other chip

stock investors that AI chip prospects remain healthy, despite a

selloff this week sparked by the release of DeepSeek's model,

which uses less computing power than those of rivals.

"The growth in artificial intelligence is the key driver for

growth in our industry," ASML CEO Christophe Fouquet said in a

statement.

DeepSeek's launch has called into question whether tech

giants, including Google, Microsoft ( MSFT ), Meta and Amazon, will need

to follow through on plans for huge investments in AI chips.

ASML's top customer, TSMC, manufactures most chips designed by

Nvidia ( NVDA ) and the software firms.

ASML reported fourth quarter net income of 2.7 billion euros

on sales of 9.3 billion euros, rising from 2.1 billion euros of

net income on sales of 7.5 billion euros in the third quarter of

2024.

The numbers beat expectations "from bookings to bottom

line," said Michael Roeg, an analyst for Degroof Petercam. He

cautioned that ASML is "too far from the fire" to really be able

to answer whether DeepSeek's advent marks a major change in

market trends.

"That is for the large data centre operators to answer in

their conference calls, and for Nvidia ( NVDA ) to answer in their

conference call," he said.

($1 = 0.9579 euros)