Company Reports

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for the next two decades. TSMC, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet lithography, a costly and long endeavor, so it is quite unlikely that ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership, and we don't see this happening in the next 10 years. The company’s competitive advantage should keep expanding as it increases its already-high EUR 6 billion research and development budget.

We are updating our long-term ASML forecasts as the firm intends to expand Low-NA EUV and DUV immersion capacity by 30% in 2027 and another potential 30% in 2028.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for the next two decades. TSMC, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership, and we don't see this happening in the next 10 years. The company’s competitive advantage should keep expanding as it increases its already-high EUR 6 billion research and development budget.

ASML’s first quarter, updated 2026 EUR 36 billion-EUR 40 billion revenue outlook, and management commentary were very bullish. This is no surprise, as demand for advanced logic and memory semiconductors remains very strong, with potential undersupply extending to 2028 or beyond.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for the next two decades. TSMC, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership, and we don't see this happening in the next 10 years. The company’s competitive advantage should keep expanding as it increases its already-high EUR 6 billion research and development budget.

ASML exited 2025 with a clear re-acceleration. Fourth-quarter net bookings reached an all-time high of EUR 13.2 billion, including EUR 7.4 billion in EUV orders, and a year-end backlog of EUR 38.8 billion.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for the next two decades. TSMC, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership, and we don't see this happening in the next 10 years. The company’s competitive advantage should keep expanding as it increases its already-high EUR 5 billion research and development budget.

It is becoming increasingly clear that 2027 and 2028 will be strong years for semiconductor equipment driven by fab expansions, as TSMC remains the “AI foundry” of the world while memory makers position themselves for strong growth through 2028.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for the next two decades. TSMC, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership, and we don't see this happening in the next 10 years. The company’s competitive advantage should keep expanding as it increases its already-high EUR 5 billion research and development budget.

According to Reuters, Chinese scientists have built a prototype machine capable of producing extreme ultraviolet light. The team, which includes former ASML employees, would have reverse-engineered the machine by sourcing parts from secondhand markets.

ASML booked EUR 5.4 billion in third-quarter orders, including EUR 3.6 billion in extreme ultraviolet. Ahead of formal 2026 guidance in January, management now expects 2026 sales to be above 2025, although the extent is unclear.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for the next two decades. TSMC, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership, and we don't see this happening in the next 10 years. The company’s competitive advantage should keep expanding as it increases its already-high EUR 5 billion research and development budget.

Wide-moat Nvidia and no-moat Intel announced a long-term collaboration for data center and PC products. European chip equipment shares were up on hopes this would be a step to revamping Intel’s foundry business. Arm Holdings’ shares are down 4%, given that this deal strengthens the x86 ecosystem.

Despite solid order intake of EUR 5.5 billion, investors disliked ASML's second-quarter results as management tempered growth expectations for 2026. Shares were down 7% in trading on July 16.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for at least the next two decades. Taiwan Semiconductor Manufacturing, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership. The company’s competitive advantage will likely keep expanding as it increases its already-high EUR 4 billion research and development budget.

ASML booked new orders of EUR 3.9 billion in the first quarter of 2025. This was below expectations, sending the stock down 6% in early trading on April 16. We reiterate our view that investors must not make long-term readouts from quarterly orders.

We believe ASML will remain the top lithography equipment provider in semiconductor foundries for at least the next two decades. Taiwan Semiconductor Manufacturing, Intel, and Samsung redesigned their fabs a decade ago to make them suitable for extreme ultraviolet, or EUV, lithography, a costly and long endeavor, so it is quite unlikely ASML will be displaced from its place in the foundry. In addition, no competitor has yet matched ASML’s technological leadership. The company’s competitive advantage will likely keep expanding as it increases its already-high EUR 4 billion research and development budget.

On April 2 the Donald Trump administration announced 20% tariffs on EU products, which sent shares of Dutch chip equipment makers ASML, ASM International, and Besi down 5%.

Wide-moat ASML exceeded all expectations in its fourth-quarter results with shares surging 11% intraday. New orders came in strongly at EUR 7.1 billion—in a context where EUR 4 billion would have been considered a success. Despite this strength, management remained cautious and maintained its EUR 30 billion-EUR 35 billion revenue guidance for 2025. Although maintaining guidance can look conservative at first glance, it’s based on the weakness shown by Intel and Samsung, which have likely pushed some orders to 2026 as they still have challenges in ramping up production of leading-edge nodes. We've raised our 2025 revenue estimate to EUR 34.2 billion from EUR 32.5 billion, but maintain our EUR 850 fair value estimate as our long-term forecasts remain largely unchanged. Shares still offer 20% upside.

We have consolidated our recent DeepSeek-related coverage in this note. Artificial intelligence affects companies across much of our coverage, including semiconductors, cloud infrastructure, software, utilities, and energy.