ASML's 2026 Growth Uncertainty Shakes AI Chip Industry

ASML's 2026 growth outlook hinges on second-quarter bookings

VELDHOVEN, July 15 (Reuters) - Investors are hoping that ASML's (ASML.AS), opens new tab bookings are robust enough to support its 2026 growth ambitions when the world's biggest chip-making equipment supplier reports its second-quarter earnings on Wednesday. The Dutch firm has lost around 30% in market value since peaking one year ago, reflecting investor concern over its growth prospects. At an investor event last November, the maker of the EUV machine - the backbone of AI chipmaking - said it saw 2026 as a growth year but didn't specify how much growth it anticipated. Analysts see the second quarter as a "make or break" period which will determine its outlook for 2026, considering delivery times typically take around 12 months. "ASML would need to double our second-quarter order estimates (of 5.3 billion euros) to comfort our 2026 revenue forecast," Barclays analyst Simon Coles told Reuters. Analysts, on average, expect second-quarter bookings to reach 4.44 billion euros, according to a consensus compiled by researcher Visible Alpha, and 21.3 billion euros for the full-year. TSMC, CHINA DEMAND Hitting those forecasts depends largely on orders from the world's top contract chipmaker TSMC (2330.TW), opens new tab, analyst Marc Hesselink of ING said. The company, which is also ASML's top customer, is expected to order the tools it needs for its upcoming manufacturing process, N2, this year. "We see a better-than-expected demand and order from TSMC and China players, but lower-than-expected demand and order from Intel and Samsung," said Kevin Wang, analyst at Mizuho. Positive news on talks with clients over future orders would also offer reassurance that it will meet current market forecasts, said Hesselink. ASML still has a long way to go in 2025 to fulfill booking expectations for its lithography systems, after net bookings, the industry's most closely watched figure, came in at 3.9 billion euro ($4.6 billion) in the first quarter, missing estimates, analysts say. Its earnings will provide a gauge of the resilience of China's chipmakers, which have been buying lower-end ASML equipment not impacted by export restrictions. That demand helped the company beat first-quarter forecasts. Last October, ASML projected Chinese orders would fall to a 20% share of all machine sales in 2025. In fact, they constituted 27% of machine sales, steady from a quarter earlier. Analysts expect that trend to continue unless U.S. export curbs are further extended to apply to the older equipment. ($1 = 0.8552 euros) Reporting by Nathan Vifflin in Amsterdam; Editing by Matt Scuffham and Bernadette Baum Our Standards: The Thomson Reuters Trust Principles., opens new tab

One of the most critical AI companies in the world just said it 'cannot confirm' growth in 2026, wiping out $30 billion

Shares of ASML, the Dutch semiconductor equipment giant, tumbled 11% on Wednesday after the company announced it could no longer confirm that it will grow in 2026. The drop wiped out over $30 billion in market value and sent shockwaves through global tech markets, as investors digested the implications for the broader semiconductor and AI industries. The selloff followed ASML's second-quarter earnings report, which beat expectations on revenue and net profit, with robust bookings of $6.4 billion. However, CEO Christophe Fouquet's comments overshadowed the strong results: "While we still prepare for growth in 2026, we cannot confirm it at this stage," he said, citing escalating macroeconomic and geopolitical uncertainty, especially the threat of new tariffs on semiconductor equipment. Smart money watches ASML for signals on the tech cycle's health; a growth warning here may be the market's early clue that the AI and semiconductor supercycle is reaching a plateau -- or at least preparing for turbulence. This isn't just a company-specific event -- it could be a canary in the coal mine for the global tech and AI ecosystem. Why? ASML is the world's exclusive supplier of EUV lithography machines -- the ultra-precise fabrication equipment that makes cutting-edge semiconductors possible. Every state-of-the-art AI accelerator, every data-center chip that powers generative AI, traces its technological lineage back to ASML's tools. So when ASML tells the market it "cannot confirm" growth for 2026 -- despite beating on current earnings -- it's signaling not just caution about its own pipeline, but a potential inflection point in the most future-critical segment of the electronics supply chain. In other words: if ASML's order book slows, it means that downstream chipmakers may anticipate softer demand, have rising uncertainty about capex returns, or are bracing for policy headwinds. The context matters: This is a moment when AI demand has been surging, but in 2025 it's now colliding with macro uncertainty, particularly driven by U.S.-EU tariff threats, China export restrictions, and capex fatigue after a historic tech investment wave. ASML's lead times are 12 to 18 months -- with orders today reflecting confidence in global chip demand well into 2026. If that confidence is wavering, it ripples through the entire innovation economy. ASML is not just another tech stock -- it is the linchpin of the global semiconductor supply chain. The company is the world's sole supplier of extreme ultraviolet (EUV) lithography machines, the critical technology that enables the production of the most advanced chips used in everything from AI accelerators to smartphones and data centers. Several factors converged to cloud ASML's outlook. One was tariff uncertainty. President Trump's threat of 30% tariffs on European imports, including semiconductor equipment, has rattled ASML's customers. The company warned that tariffs on new systems and parts shipped to the U.S., as well as possible retaliatory measures, could directly hit its gross margins and delay customer investment decisions. Ongoing trade disputes and export controls, especially involving China and the U.S., have made it harder for ASML to forecast demand. Clients are increasingly cautious, with some potentially postponing or scaling back orders. While Q2 bookings were strong, Barclays analysts noted ASML would need to double its current order pace to meet previous 2026 growth forecasts. The backlog coverage for 2026 is at its lowest in three years, raising doubts about near-term momentum. The market's response was swift and severe as ASML shares fell 11%, their steepest single-day drop since October 2024, when a disappointing third-quarter earnings report led to the stock price falling 16%. Wednesday's selloff dragged down the broader European tech sector and hit U.S. semiconductor equipment peers such as Lam Research and Applied Materials. In contrast, AI chipmakers such as Nvidia and AMD rose, buoyed by positive news on U.S. export policy to China, highlighting a divergence between chip designers and the equipment supply chain.

ASML says it can't be certain of 2026 growth; stock falls

ASML just crushed this second quarter -- and then might have crushed investors' hopes for 2026. The Dutch chip-machine powerhouse smashed expectations with €7.7 billion in revenue, €2.3 billion in profit, and €5.5 billion in orders, fueled by booming AI demand and a €2.3 billion haul from its extreme ultraviolet (EUV) lithography systems. But then came the gut punch: While demand for ASML's AI chips is still red hot, the company said it can't promise 2026 growth amid President Donald Trump's tariff threats and the wider geopolitical fog. "Looking at 2026, we see that our AI customers' fundamentals remain strong," ASML CEO Christophe Fouquet said in a statement. "At the same time, we continue to see increasing uncertainty driven by macro-economic and geopolitical developments. Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." ASML shares sank as much as 8% in European trading on Wednesday morning and around 10% on Wall Street as of 11 a.m. ET, dragging down other chip stocks and sending tremors through the European tech and semiconductor sectors. Analysts moved quickly. Jefferies downgraded the stock from "Buy" to "Hold," slashing its 2026 forecast from 7% growth to a potential 2% decline. Barclays flagged signs of softening demand from Intel and Samsung and noted delays in ASML's rollout of its next-generation High-NA systems -- tools that represent the future of ultra-precise chip manufacturing. Fouquet's comments are the first time in years that ASML has even hinted that growth might not be a given. And the comments come at a moment when the global semiconductor sector is supposed to be entering its AI-powered golden era. But the geopolitical threat the company faces is real. A 30% U.S. tariff on EU goods, set to take effect on August 1, could push the price of ASML's top-tier EUV machines from €250 million to €325 million, stalling U.S. factory buys and freezing investment decisions until trade winds calm. ASML frequently ships parts back and forth between Amsterdam and the U.S. In a pre-recorded interview posted on ASML's website, Chief Financial Officer Roger Dassen said the beat was due to revenue from upgrading currently deployed machines as well as tariffs having a "less negative" impact than anticipated. The Dutch company is ready to pass most of the tariff costs onto customers, Dassen said on a call with reporters. "The burden of tariffs from our vantage point should be allocated in a fair way. ... We think that those taking it in the United States should, therefore, take the lion's share of that allocation." Still, not everything is freezing up. AI-related demand -- especially from TSMC and customers in China -- remains strong. China alone accounted for 27% of system sales this quarter, despite continued export restrictions imposed by the Dutch government (with no end to them in sight). Plus, ASML's full-year 2025 forecast remains unchanged, calling for 15% revenue growth. The company's gross margin hit 53.7% in the second quarter, and its order book remains thick enough to keep its factories humming through the rest of the year. But 2026 is now a question mark. Not because ASML has lost its technical edge -- quite the opposite, actually -- but because the world's most advanced chip tools are caught in the geopolitical crossfire. The race to build chips that power AI, run data centers, and secure geopolitical advantage is colliding with the unpredictable pace of trade wars. ASML can make the tools that shape the future of silicon, but it can't print a stable global order.

Dutch tech giant ASML sees profits rise but warns on 2026

The Hague (AFP) - Dutch tech giant ASML said Wednesday it booked higher net profits in the second quarter of 2025 compared with the same period last year but warned that geopolitical headwinds had darkened the 2026 outlook. The firm, which makes cutting-edge machines for the manufacture of semiconductors, said net profits came in at 2.3 billion euros, compared with 1.6 billion euros in the second quarter of last year. However, it warned that the growth outlook for next year was somewhat less rosy than before. "Looking at 2026, we see that our AI customers' fundamentals remain strong," said Chief Executive Officer Christophe Fouquet in a statement. "At the same time, we continue to see increasing uncertainty driven by macro-economic and geopolitical developments," he cautioned. "Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." When Fouquet presented first-quarter results in April, he also warned of "increased uncertainty" due to tariffs with the situation likely to "remain dynamic for a while." However, he had reiterated his belief at that stage that 2025 and 2026 would be "growth years." The firm said its net sales in the second quarter of 2025 came in at 7.7 billion euros, at the upper end of its forecasts of between 7.2 and 7.7 billion euros. Net bookings, the figures most closely watched in the markets as a predictor of future performance, were 5.6 billion euros, compared to 3.9 billion euros in the first quarter. Fouquet said he expected sales in the third quarter to come in between 7.4 billion and 7.9 billion euros. AI market 'very strong' ASML is a key cog in the global economy, as the semiconductors its machines help to make can power everything from smartphones to missiles. Longer term, ASML believes the rapidly expanding AI market will push sales up to between 44 and 60 billion euros by 2030. "I think long term, the semiconductor market remains very strong," said Fouquet. "And I think a lot of people say that AI is really a great opportunity. We have seen again the fundamentals around AI to be very, very strong." The semiconductor industry has been buffeted by geopolitical headwinds in recent years. Washington has sought to curb exports of state-of-the-art chips to China, concerned that they could be used to advance Beijing's military systems and otherwise undermine American dominance in AI. In May, Trump's administration rescinded some export controls on semiconductors. But Washington also unveiled fresh guidelines warning firms that using Chinese-made high-tech AI semiconductors, specifically tech giant Huawei's Ascend chips, would put them at risk of violating US export controls. Beijing described the warnings as "typical unilateral bullying and protectionism." On Tuesday, US tech giant Nvidia announced it would resume sales of its H20 artificial intelligence chips to China, after Washington pledged to remove licensing curbs that had halted exports.

ASML sees share price drop as Trump's tariffs darken outlook

The Dutch tech firm saw its shares drop almost 7% in morning trading after it released second-quarter results. Sales rose above analysts' expectations, although ASML warned that tariffs threaten its growth target for 2026. Supplier of chipmaking equipment ASML retracted its growth forecast for the coming year on Wednesday, sending shares down around 7% in morning trading in Amsterdam. "The level of uncertainty is increasing, mostly due to macroeconomic and geopolitical considerations. And that includes, of course, tariffs," said CEO Christophe Fouquet. "Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." The warning came despite the fact that the Dutch firm saw sales and bookings rise above analysts' expectations during the second quarter. Sales rose 23% to €7.7 billion, while net bookings came in at €5.5bn. Net income was at €2.3bn. For the third-quarter, ASML predicted net sales between €7.4bn and €7.9bn, falling short of estimates, and a gross margin between 50% and 52%. The firm also forecast 15% revenue growth for the year ahead. A boom in artificial intelligence is fuelling demand for ASML's semiconductor-making machines, which are needed to power AI technologies. Last week, chipmaker Nvidia -- a firm that relies on ASML products -- became the first company in the world to reach a market value of $4 trillion. So far, the extent to which ASML will be affected by US tariffs and retaliatory duties is unclear. Semiconductors are currently exempt from Trump's duties although it's not yet known whether chipmaking machines will receive the same leniency. Easing tensions between the US and China are also helping Nvidia, which in turn bodes well for ASML. On Tuesday, Nvidia said it would start selling its H20 AI chip in China again after the Trump administration relaxed export restrictions. The move is a U-turn for the government, which in April banned sales of the chip to China, linked to concerns that the technology could be used for military purposes. ASML also faces restrictions on sending certain advanced products to China. There has been no suggestion that these measures, imposed by the Dutch government, will be lifted. "ASML cites the macroeconomic environment and tariffs having an impact on the orders. More specifically, it is more likely uncertainty from China, memory capex uncertainty and the struggles at Intel and Samsung that are more likely to be hampering things," said Ben Barringer, global technology analyst at Quilter Cheviot. Intel and Samsung, two ASML customers, are facing financial headwinds, with the latter reporting its first fall in profit in around two years last week. Barringer continued: "Ultimately, this is a speed bump for what remains a high-quality company. It still has a big backlog so growth should still pull through".

ASML shares drop 11% on cautious 2026 growth outlook - SiliconANGLE

Shares of ASML Holding NV closed 11.4% lower today after it posted strong second quarter results and disappointing guidance. The chipmaking equipment supplier cautioned that it "cannot confirm" it will experience revenue growth in 2026. Eindhoven, Netherlands-based ASML makes machines for etching transistors into silicon wafers. The company is the world's sole supplier of EUV, or extreme ultraviolet lithography, systems. Those are particularly sophisticated transistor-etching machines that are used to make the most advanced processors on the market. ASML's revenue rose 24% in the second quarter to €7.7 billion, or $8.95 billion. The consensus estimate projected €7.52 billion. ASML Chief Financial Officer Roger Dassen told investors that the better-than-expected sales increase was partly driven by upgrades made to customers' EUV equipment. Last year, ASML started shipping a third-generation EUV system called the NXE:3800E. On launch, it was capable of processing 195 silicon wafers per hour. The company stated at the time that future upgrades would make it possible to reach 220 wafers per hour. ASML's profit also topped the consensus estimate. The company closed the second quarter with a net profit of €2.29 billion, well ahead of the €2.04 billion that the market had expected. Dassen said that "one-off cost benefits" factored into the company's strong bottom line performance. ASML expects its momentum to slow in the current quarter. The company is projecting sales of €7.4 billion to €7.9 billion, below the €8.3 billion that analysts were looking for. Furthermore, ASML has narrowed its full-year revenue growth guidance from 23.8% to 15%. The company believes that the slowdown may continue into 2026. "Looking at 2026, we see that our AI customers' fundamentals remain strong," said ASML Chief Executive Officer Christophe Fouquet. "At the same time, we continue to see increasing uncertainty driven by macro-economic and geopolitical developments. Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." ASML's long-term revenue growth plans focus on its top-end High NA lithography systems. The machines, which cost more than $400 million apiece, use shorter light beams to etch transistors than the company's EUV equipment. As a result, they can produce smaller, more power-efficient circuits. Fouquet disclosed today that multiple customers have deployed ASML's EXE:5000 High NA system. According to the executive, the machine functions as a kind of testbed that helps the company enhance its lithography technology. The optimizations developed through the process have been incorporated into a newer system called the EXE:5200.

Chip Gear Maker ASML Can't Guarantee Growth This Year. Its Stock Is Falling.

The company, whose machines are needed to make advanced AI chips, made the statement as it posted second-quarter results. ASML Holding (ASML) shares are dropping in premarket trading Wednesday after the Dutch semiconductor-gear manufacturer said it couldn't guarantee growth in the coming year and as President Donald Trump's tariff threats weigh on its outlook. "Looking at 2026, we see that our AI customers' fundamentals remain strong. At the same time, we continue to see increasing uncertainty driven by macro-economic and geopolitical developments," CEO Christophe Fouquet said in a statement as the Dutch firm announced second-quarter results. "Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." The company, whose extreme ultraviolet (EUV) lithography machines help make advanced AI chips, made the statement as it posted second-quarter results. ASML's U.S.-listed shares, which entered Wednesday up by 18% this year, are 7% lower in premarket trading. Trump over the weekend sent a letter to the EU threatening 30% tariffs on imports from Aug. 1 onwards. ASML sells its machines to customers globally, including American chip maker Intel (INTC) and Taiwan Semiconductor Manufacturing Company (TSM), the world's largest contract chip maker. Semiconductors are currently exempted from U.S. tariffs, but it's unclear whether gear makers like ASML would benefit from that. Trump also said late Tuesday that he was probably going to impose tariffs on semiconductors, along with pharmaceuticals, by Aug. 1, according to Bloomberg. ASML also narrowed its growth outlook for the year. The company said it expects a full-year 2025 total net sales increase of around 15% relative to 2024 and projected gross margin of around 52%. Both of those numbers were around the midpoint of the outlook the company offered with its first quarter results.

Chip Gear Maker ASML Can't Guarantee Growth Next Year. Its Stock Is Falling.

The company, whose machines are needed to make advanced AI chips, made the statement as it posted second-quarter results. ASML Holding (ASML) shares are dropping in premarket trading Wednesday after the Dutch semiconductor-gear manufacturer said it couldn't guarantee growth in the coming year and as President Donald Trump's tariff threats weigh on its outlook. "Looking at 2026, we see that our AI customers' fundamentals remain strong. At the same time, we continue to see increasing uncertainty driven by macro-economic and geopolitical developments," CEO Christophe Fouquet said in a statement as the Dutch firm announced second-quarter results. "Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." The company, whose extreme ultraviolet (EUV) lithography machines help make advanced AI chips, made the statement as it posted second-quarter results. ASML's U.S.-listed shares, which entered Wednesday up by 18% this year, are 7% lower in premarket trading. Trump over the weekend sent a letter to the EU threatening 30% tariffs on imports from Aug. 1 onwards. ASML sells its machines to customers globally, including American chip maker Intel (INTC) and Taiwan Semiconductor Manufacturing Company (TSM), the world's largest contract chip maker. Semiconductors are currently exempted from U.S. tariffs, but it's unclear whether gear makers like ASML would benefit from that. Trump also said late Tuesday that he was probably going to impose tariffs on semiconductors, along with pharmaceuticals, by Aug. 1, according to Bloomberg. ASML also narrowed its growth outlook for the year. The company said it expects a full-year 2025 total net sales increase of around 15% relative to 2024 and projected gross margin of around 52%. Both of those numbers were around the midpoint of the outlook the company offered with its first quarter results. Among other chip stocks, shares of Nvidia (NVDA) and Advanced Micro Devices (AMD), which both surged Tuesday as they said the U.S. would allow them to resume selling AI chips to China, are pointing lower, as are Intel and TSMC.

Dutch tech giant ASML sees profits rise but warns on 2026 - The Economic Times

ASML reported Q2 2025 net profit of €2.3 billion, up from €1.6 billion, with sales reaching €7.7 billion. However, the firm warned of 2026 uncertainty due to geopolitical tensions. Despite strong AI market fundamentals, CEO Christophe Fouquet said growth in 2026 cannot yet be confirmed amid rising macro-economic risks.Dutch tech giant ASML said Wednesday it booked higher net profits in the second quarter of 2025 compared with the same period last year but warned that geopolitical headwinds had darkened the 2026 outlook. The firm, which makes cutting-edge machines for the manufacture of semiconductors, said net profits came in at €2.3 billion, compared with 1.6 billion euros in the second quarter of last year. However, it warned that the growth outlook for next year was somewhat less rosy than before. "Looking at 2026, we see that our AI customers' fundamentals remain strong," said Chief Executive Officer Christophe Fouquet in a statement. "At the same time, we continue to see increasing uncertainty driven by macro-economic and geopolitical developments," he cautioned. "Therefore, while we still prepare for growth in 2026, we cannot confirm it at this stage." When Fouquet presented first-quarter results in April, he also warned of "increased uncertainty" due to tariffs with the situation likely to "remain dynamic for a while." However, he had reiterated his belief at that stage that 2025 and 2026 would be "growth years." The firm said its net sales in the second quarter of 2025 came in at €7.7 billion, at the upper end of its forecasts of between 7.2 and 7.7 billion euros. Net bookings, the figures most closely watched in the markets as a predictor of future performance, were €5.6 billion, compared to €3.9 billion in the first quarter. Fouquet said he expected sales in the third quarter to come in between €7.4 billion and €7.9 billion. AI market 'very strong' ASML is a key cog in the global economy, as the semiconductors its machines help to make can power everything from smartphones to missiles. Longer term, ASML believes the rapidly expanding AI market will push sales up to between €44 and €60 billion by 2030. "I think long term, the semiconductor market remains very strong," said Fouquet. "And I think a lot of people say that AI is really a great opportunity. We have seen again the fundamentals around AI to be very, very strong." The semiconductor industry has been buffeted by geopolitical headwinds in recent years. Washington has sought to curb exports of state-of-the-art chips to China, concerned that they could be used to advance Beijing's military systems and otherwise undermine American dominance in AI. In May, Trump's administration rescinded some export controls on semiconductors. But Washington also unveiled fresh guidelines warning firms that using Chinese-made high-tech AI semiconductors, specifically tech giant Huawei's Ascend chips, would put them at risk of violating US export controls. Beijing described the warnings as "typical unilateral bullying and protectionism." On Tuesday, US tech giant Nvidia announced it would resume sales of its H20 artificial intelligence chips to China, after Washington pledged to remove licensing curbs that had halted exports.

ASML stock drops 6.5% despite strong Q2 earnings -- why is it falling while other chip stocks rise amid trimmed 2025 forecast and weak 2026 growth outlook?

ASML shares drop after the company warned it may not grow in 2026, despite beating Q2 2025 earnings expectations. ASML reported strong net sales of €7.7 billion and net profit of €2.29 billion, driven by AI-related chip demand. But the company's cautious outlook, especially about geopolitical risks and macro uncertainty, led to a 6.5% stock dip. ASML also trimmed its 2025 forecast and missed Q3 revenue guidance. Investors are now closely watching the future of its High NA EUV machines and continued AI chip growth. Read more to understand what's behind this key semiconductor stock move.

ASML Shares Tumble. Time to Run for the Hills or Buy the Dip? | The Motley Fool

Shares of ASML Holding (ASML -1.40%) sank after the company warned it was uncertain about its growth outlook for 2026. The stock has fallen about 30% over the past year, as of this writing. For those unfamiliar with ASML, the Dutch company is a semiconductor equipment manufacturer that makes the devices that foundries, such as Taiwan Semiconductor Manufacturing, use to make chips. It has a virtual monopoly on extreme ultraviolet (EUV) lithography, which is the manufacturing process used create advanced chips, such as Nvidia's graphics processing units (GPUs). The company has also developed a new technology called a high numerical aperture extreme ultraviolet lithography system, or High NA EUV, to help shrink nodes. Nodes represent the size of the transistors used on a chip, and foundries and chipmakers are continually looking to shrink node sizes, as that makes the chips more powerful and energy-efficient. However, the cost of ASML's new High NA EUV machines is around $400 million each, which has led customers to push back. ASML's Q2 results were actually quite strong. Revenue for the quarter jumped 23% to 7.7 billion euros ($9 billion) and came in at the high end of the company's guidance range of 7.2 billion to 7.7 billion euros ($8.4 billion to $9 billion). Its equipment sales rose nearly 18% year over year to 5.6 billion euros ($6.5 billion), while its service revenue soared 42% to 2.1 billion euros ($2.5 billion). During the quarter, the company sold 67 new lithography systems and nine used systems compared to 89 new and 11 used systems in the year-ago quarter. However, 48% of its sales came from higher-priced EUV technology versus only 31% a year ago, as it had a large percentage of sales to China a year ago. The company said that growth is being driven by artificial intelligence (AI) and that more customers are shifting toward EUV technology. It sees its customers looking to increase their EUV capacity by 30% this year. Overall, it is looking for a 15% increase in revenue in 2025, with a sustained improvement of its service business in the second half. It noted that the direct and the indirect impact of tariffs remains uncertain, and that it's navigating the situation the best it can. Its net bookings, which can be a good indicator of future revenue growth, were solid, coming in at 5.5 billion euros ($6.4 billion). That was well ahead of the 4.2 billion euros ($4.9 billion) in net bookings that analysts were expecting. However, its Q3 guidance calling for revenue of between 7.4 billion euros ($8.6 billion) and 7.9 billion euros ($9.2 billion) was below the analyst consensus of 8.3 billion euros ($9.7 billion). Looking toward 2026, the company continues to expect strong demand coming from AI. However, given the current macroeconomic and geopolitical environment -- along with some companies dealing with company-specific issues that could impact the timing of their capital expenditure (capex) -- it is unclear what its growth next year might look like. While ASML's Q2 results were strong, investors were clearly disappointed with the company's commentary about 2026. To be fair, the semiconductor equipment business is notoriously lumpy. A few large foundries make up the bulk of its EUV business, while Chinese companies had been rushing to get their lower-end equipment on fears it too would be banned in the country. Meanwhile, Intel and Samsung, two of the world's largest foundries, have had their share of struggles, which could be leading to some of the uncertainty with regard to next year. That said, I view the sell-off in ASML shares as a buying opportunity. The company basically has a 100% market share when it comes to the EUV technology that is needed to make advanced chips. And with demand for advanced chips continuing to grow, foundries are going to need EUV machines to make them. Meanwhile, while leading foundry TSMC has balked at the high price of ASML's new High NA EUV machines, it cannot afford to delay their use indefinitely, as the cost of falling behind technologically would be much worse. Following the market sell-off, ASML shares trade at a forward price-to-earnings (P/E) multiple of 27x based on 2025 analyst estimates. With nearly no competition for EUV lithography and growing demand for advanced chips, this is a stock you'd want to own at these levels for the long term.

ASML: Strong Quarter, Uncertain Guidance | The Motley Fool

ASML is the world's go-to supply of high-end lithography equipment used to manufacture microchips, with its most expensive systems selling for nearly $400 million each. The company stands to be a major beneficiary of the AI boom, which is fueling demand for more chips and the machines that produce them, but the high price of its systems tends to result in quarter-to-quarter choppiness. ASML posted revenue and earnings up 24% and 47% year over year despite selling fewer systems this quarter. Lithography equipment varies in price based on the sophistication of the device, implying that the company is seeing strong demand for its newer, cutting-edge technology. Net bookings in the quarter came in flat at 5.5 billion euros, of which 2.3 billion euros was for higher-end systems. The company generated a gross margin of 53.7% in the quarter. But the company is worried about storm clouds on the horizon. ASML's semiconductor customers have been dealing with heightened uncertainty due to trade restrictions and tariff policies, creating questions about orders heading into 2026. CEO Christophe Fouquet said, "AI customers' fundamentals remain strong," but ASML is seeing "increasing uncertainty driven by macro-economic and geopolitical developments." Fouquet said that while ASML is still preparing for growth in 2026, "we cannot confirm it at this stage." Investors were focused on the commentary about 2026, and not the second-quarter results. ASML shares were down 8% in premarket trading ahead of the New York Stock Exchange open. Although ASML's cautious guidance about 2026 is weighing on investors post-earnings, the long-term growth story is still intact. The company is a vital piece in the supply of arguably one of the most important components of the global economy, and with AI spending and other digital efforts likely to continue to build for years to come, there should be solid demand for semiconductors and the machines needed to make them. The geopolitical situation is rapidly changing. Just this week, the U.S. reversed a ban on Nvidia (NVDA 0.09%) selling its H20 chips in China. In a recorded interview posted on ASML's website accompanying earnings, the company's chief financial officer, Roger Dassen, attributed the second-quarter beat in part to tariffs having a "less negative" impact than anticipated. If that trend continues, ASML's caution about 2026 could prove to be overly conservative.

ASML outlines 15% revenue growth for 2025 amid strong EUV demand and macro uncertainty (NASDAQ:ASML)

Christophe D. Fouquet, CEO, emphasized continued strong financial performance in Q2 and highlighted that "artificial intelligence is the key driver of growth in Memory and Logic at this point." He indicated ongoing demand for Seeking Alpha's Disclaimer: The earnings call insights are compilations of earnings call transcripts and other content available on the Seeking Alpha website. The insights are generated by an AI tool and have not been curated or reviewed by editors. Due to inherent limitations in using AI-based tools, the accuracy, completeness, or timeliness of the earnings call insights cannot be guaranteed. Please see full earnings call transcripts here. The earnings call insights are intended for informational purposes only. Seeking Alpha does not take account of your objectives or your financial situation and does not offer any personalized investment advice. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank.

ASML's 2026 growth outlook hinges on second-quarter bookings

VELDHOVEN (Reuters) -Investors are hoping that ASML's bookings are robust enough to support its 2026 growth ambitions when the world's biggest chip-making equipment supplier reports its second-quarter earnings on Wednesday. The Dutch firm has lost around 30% in market value since peaking one year ago, reflecting investor concern over its growth prospects. At an investor event last November, the maker of the EUV machine - the backbone of AI chipmaking - said it saw 2026 as a growth year but didn't specify how much growth it anticipated. Analysts see the second quarter as a "make or break" period which will determine its outlook for 2026, considering delivery times typically take around 12 months. "ASML would need to double our second-quarter order estimates (of 5.3 billion euros) to comfort our 2026 revenue forecast," Barclays analyst Simon Coles told Reuters. Analysts, on average, expect second-quarter bookings to reach 4.44 billion euros, according to a consensus compiled by researcher Visible Alpha, and 21.3 billion euros for the full-year. TSMC, CHINA DEMAND Hitting those forecasts depends largely on orders from the world's top contract chipmaker TSMC, analyst Marc Hesselink of ING said. The company, which is also ASML's top customer, is expected to order the tools it needs for its upcoming manufacturing process, N2, this year. "We see a better-than-expected demand and order from TSMC and China players, but lower-than-expected demand and order from Intel and Samsung," said Kevin Wang, analyst at Mizuho. Positive news on talks with clients over future orders would also offer reassurance that it will meet current market forecasts, said Hesselink. ASML still has a long way to go in 2025 to fulfill booking expectations for its lithography systems, after net bookings, the industry's most closely watched figure, came in at 3.9 billion euro ($4.6 billion) in the first quarter, missing estimates, analysts say. Its earnings will provide a gauge of the resilience of China's chipmakers, which have been buying lower-end ASML equipment not impacted by export restrictions. That demand helped the company beat first-quarter forecasts. Last October, ASML projected Chinese orders would fall to a 20% share of all machine sales in 2025. In fact, they constituted 27% of machine sales, steady from a quarter earlier. Analysts expect that trend to continue unless U.S. export curbs are further extended to apply to the older equipment. ($1 = 0.8552 euros) (Reporting by Nathan Vifflin in Amsterdam; Editing by Matt Scuffham and Bernadette Baum)

ASML warns it may not achieve growth in 2026, shares drop

VELDHOVEN (Reuters) -ASML, the world's biggest supplier of computer chip-making equipment, warned on Wednesday that it may not achieve growth in 2026, even after its second-quarter bookings beat market expectations. Analysts had hoped that the quarter would provide some reassurance over its outlook for 2026. However, the company warned that geopolitical uncertainty continued to cloud its prospects. Shares sank as much as 7.3% in early trading. "The level of uncertainty is increasing, mostly due to macroeconomic and geopolitical consideration. And that includes, of course, tariffs," ASML's Chief Executive Christophe Fouquet said in an internal interview on the company's website. The direct and indirect impact of tariffs are still very uncertain, CFO Roger Dassen said in the interview, ASML was working with its supply chain to mitigate any impact. "While we still prepare for growth in 2026, we cannot confirm it at this stage," Fouquet said in a statement. If it materialized, 2026 would be the first flat year in over a decade of uninterrupted revenue growth since 2012. ASML investor Han Dieperink, chief investment officer at investment firm Aureus, said he was not worried about the upcoming year, noting that the quarter pointed to solid demand. The Dutch group's net bookings, the most closely watched figure in the industry, were 5.54 billion euros ($6.4 billion). That was ahead of analysts' consensus estimate of 4.44 billion euros, according to researcher Visible Alpha. "The second quarter beats from top to bottom," analyst Michael Roeg of Degroof Petercam said. Roeg cited strong demand from artificial intelligence related chipmakers. ASML's EUV lithography machines, the world's most advanced chip circuit printing system, is the key enabling technology behind leading-edge chips like those used in Nvidia's GPUs, or Apple's Macs and iPhones. Chinese demand also remained elevated, representing 27% of all machine sales in the last three quarters, and confirming the country's chipmakers have continued to buy less advanced machines in anticipation for more U.S.-led export restrictions. ($1 = 0.8608 euros) (Reporting by Nathan Vifflin in Amsterdam; Editing by Matt Scuffham, Kim Coghill and Bernadette Baum)

ASML says it may not achieve 2026 growth as chipmakers face US tariff uncertainty

VELDHOVEN, Netherlands (Reuters) -ASML, the world's biggest supplier of computer chip-making equipment, warned on Wednesday that it may not achieve growth in 2026 as chipmakers building factories in the U.S. await clarity on how hard tariffs will impact them. The uncertainty in tariff negotiations is spurring chipmakers in the U.S. to delay finalizing investments, CFO Roger Dassen told journalists on a media call. Shares in ASML fell as much as 7.8% and were on track for their worst day since October, dragging peers ASM, BESI, Soitec lower as well. A potential 30% U.S. tariff on European goods could ramp up the price of a single high-end machine to 325 million euros from 250 million euros, he noted. "Clarity is what customers are looking for before they can really finalize their views as to what they're going to do," Dassen said, reiterating ASML's intention to pass such costs on. Beyond a simple tax on a finished machine, the tariffs may pile up for ASML as parts are sent from the Netherlands to the U.S. several times. Analysts had hoped that the quarter would provide some reassurance over its outlook for 2026, but the company warned that geopolitical uncertainty still clouded its prospects. SALES GROWTH UNCERTAIN "The level of uncertainty is increasing, mostly due to macroeconomic and geopolitical consideration. And that includes, of course, tariffs," ASML's Chief Executive Christophe Fouquet said in an internal interview on the company's website. The direct and indirect impact of tariffs was still very uncertain, CFO Roger Dassen said in the interview, and ASML was working with its supply chain to mitigate any impact. "While we still prepare for growth in 2026, we cannot confirm it at this stage," Fouquet said in a statement. If it materialized, 2026 would be the first flat year in over a decade of uninterrupted revenue growth since 2012. ASML investor Han Dieperink, chief investment officer at investment firm Aureus, said he was not worried about the upcoming year, noting that the quarter pointed to solid demand. The Dutch group's net bookings, the most closely watched figure in the industry, were 5.54 billion euros ($6.4 billion), 25% ahead of analysts' consensus estimate of 4.44 billion euros, according to researcher Visible Alpha. ASML's EUV lithography machines represented 42% of those bookings, or 2.3 billion euros' worth. The machines, which are the world's most advanced chip circuit printing system, are the key enabling technology behind leading-edge chips like those used in Nvidia's GPUs, or Apple's Macs and iPhones. "The second quarter beats from top to bottom," analyst Michael Roeg of Degroof Petercam said. Roeg cited strong demand from artificial intelligence related chipmakers. Chinese demand also remained elevated, representing 27% of all machine sales in the last three quarters, and confirming the country's chipmakers have continued to buy less advanced machines in anticipation for more U.S.-led export restrictions. ($1 = 0.8608 euros) (Reporting by Nathan Vifflin in Amsterdam; Editing by Matt Scuffham, Kim Coghill and Bernadette Baum)