ASML Surges on Record Orders, Forecasts Strong 2026 Fueled by AI Demand
ASML, the Dutch semiconductor equipment manufacturer, reported fourth-quarter orders that significantly surpassed analyst expectations, alongside a 2026 sales forecast that also exceeded estimates. This strong performance is largely attributed to the sustained demand for artificial intelligence infrastructure, a key growth driver for the company.
In the fourth quarter of 2025, ASML secured bookings totaling 13.2 billion euros ($15.8 billion). This figure handily outpaced the Visible Alpha consensus of 6.32 billion euros, marking a record quarter for new orders, according to ASML’s Chief Financial Officer, Roger Dassen. The company also announced a substantial 12-billion-euro share buyback program slated to run through December 31, 2028.
Looking ahead, ASML projects first-quarter net sales to range between 8.2 billion and 8.9 billion euros. For the full year 2026, the company anticipates total sales to fall between 34 billion and 39 billion euros, with the midpoint of this guidance exceeding the consensus estimate of 35.1 billion euros. This updated outlook represents a potential revenue growth of 4% to 19% compared to 2025, an improvement from ASML’s previous commentary that indicated uncertainty regarding revenue growth in 2026. Previously, the company had stated that it did not expect 2026 total net sales to be below 2025 levels.
In the fourth quarter, ASML’s reported figures were:
* **Net Sales:** 9.7 billion euros ($11.6 billion), compared to an expected 9.6 billion euros.
* **Net Profit:** 2.84 billion euros, versus the expected 3.01 billion euros.
Concurrently with its financial results, ASML announced plans for workforce reductions, impacting approximately 1,700 positions, primarily in the Netherlands and some in the United States. The company cited a need to enhance agility as a key reason for these adjustments.
**AI Tailwinds Propel Growth**
ASML, a critical player in the manufacturing of the world’s most advanced chips, is benefiting significantly from the booming AI infrastructure market. This trend has been a major catalyst for its stock performance, which has seen an increase of nearly 30% year-to-date.
The robust demand for AI chips is further underscored by recent performance from key customers. Taiwan Semiconductor Manufacturing Co. (TSMC), a major client of ASML and the world’s largest contract chipmaker, recently reported another record profit for the fourth quarter. TSMC manufactures semiconductors for leading technology firms, including Nvidia and AMD.
Adding to the favorable market conditions, a shortage in memory semiconductors has led to unprecedented price increases for these components. Industry observers anticipate this crunch to persist through 2027. Forecasts suggest that major memory manufacturers like Samsung and SK Hynix are poised to expand their chipmaking capacity in the coming year or two, which would necessitate increased investment in ASML’s advanced lithography systems.
Barclays, for instance, recently noted in a research report that it expects SK Hynix to procure 12 of ASML’s extreme ultraviolet (EUV) lithography machines in 2026. ASML’s CFO echoed this positive sentiment, stating that its customers are exhibiting a more optimistic outlook on medium-term market prospects, driven by the perceived sustainability of AI demand. This has prompted some customers to accelerate their plans for medium-term capacity expansion. ASML anticipates that revenue generated from its EUV machines, among its most sophisticated offerings, will see a substantial increase in 2026 compared to the previous year, as chipmakers scale up production of next-generation semiconductors.
**Navigating the China Market**
Investors are closely monitoring any developments concerning China, a significant market where ASML faces export restrictions that prevent the sale of its most advanced machines. Last year, ASML indicated an expectation of a considerable decline in sales from China in 2026 relative to 2024 and 2025. The company currently projects that revenue from China will constitute 20% of its total sales in 2026, a decrease from the 33% share it represented in net system sales last year.
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