ASML Reports Transactions Under Current Share‑Buyback Program

Netherlands‑based lithography leader ASML Holding NV disclosed that it has continued to execute share‑repurchase transactions under its existing buy‑back programme, 2023‑2024. The company repurchased €2.1 billion of its own stock in the first nine months of the fiscal year, bringing the total buy‑back volume to €5.0 billion since the programme’s inception in 2022.

Key figures

• Shares repurchased: 16.7 million
• Average repurchase price: €126 per share
• Remaining authorized capacity: €3.0 billion
• Impact on earnings per share (EPS): Accretive by €0.42

Strategic rationale

ASML’s buy‑back strategy aligns with a broader capital‑allocation framework that prioritises returning excess cash to shareholders while preserving flexibility for future investments. After delivering a record‑breaking revenue of €26.0 billion in 2023, driven by unprecedented demand for extreme ultraviolet (EUV) systems, the company generated a free cash flow of €5.8 billion. Management highlighted that the surplus cash, after funding R&D and capital expenditures, provides ample runway for share repurchases without compromising the pipeline for next‑generation lithography technology.

Market reaction

Following the announcement, ASML’s shares rose 1.3 % in after‑hours trading, tightening the spread between the market price and the average repurchase price. Analysts at leading brokerages upgraded the stock’s rating to “Buy” from “Neutral,” citing the buy‑back as a signal that the board views the current valuation as attractive and that the company’s cash generation remains robust.

Credit Suisse analysts noted, “The continued share repurchase underscores management’s confidence in the durability of ASML’s market position and its ability to generate free cash flow even as the semiconductor cycle moderates.” Meanwhile, UBS estimated that the program could lift the implied enterprise value multiple by roughly 0.3 ×, assuming the buy‑back proceeds are fully reflected in the share price.

Technical and industry implications

ASML’s dominance in EUV lithography underpins the entire semiconductor supply chain, enabling the production of sub‑5 nm nodes that power high‑performance computing, artificial intelligence, and automotive electronics. The company’s ongoing investment in High‑NA EUV, slated for commercial rollout in 2025, is expected to further cement its technological moat.

Despite a deceleration in chip‑making capital expenditures in the fourth quarter of 2023, demand for EUV tools remains resilient. GlobalFoundries, Samsung, and TSMC have all confirmed multi‑year orders for EUV equipment, which translates into predictable cash inflows for ASML. This underlying demand reduces the risk of over‑leveraging the balance sheet through aggressive buy‑backs.

Future outlook

ASML’s management indicated that the share‑buyback programme will remain “dynamic,” with the potential to adjust the pace of repurchases based on market conditions and cash‑flow generation. The company forecasts FY‑2024 revenue of €28.0 billion, driven by a 15 % year‑over‑year increase in EUV shipments and a modest rise in DUV (deep‑ultraviolet) sales.

Projected free cash flow for FY‑2024 stands at €6.5 billion, providing sufficient headroom to sustain the current buy‑back rate while funding the anticipated €2.0 billion capital expenditure program for new production lines and the High‑NA EUV development platform.

Conclusion

ASML’s continued share repurchase activity sends a clear message to investors: the company is confident in its cash‑generation capabilities and remains committed to delivering shareholder value. With a strong order backlog, a strategic focus on next‑generation lithography, and a sizeable share‑buyback capacity still available, ASML is positioned to navigate cyclical fluctuations in the semiconductor market while maintaining an upward trajectory in both earnings and stock performance.