ASML's 2028 Gross Margin Could Take Hit if Supply Tightness Eases

Dow Jones10-15

0931 GMT - ASML Holding's gross margin could face hurdles if the supply tightness that is permeating the semiconductor industry eases in 2028, Jefferies analysts write in a note to clients. The Dutch supplier of semiconductor-making equipment is looking at ways to boost production of its machines in coming years to meet robust demand from chip makers. However, analysts say it is too early to predict the industry's strength in 2028 and that supply tightness could ease by then. If so, they estimate ASML's gross margin--a closely watched metric of pricing power and profitability--could be 58.2% in 2028. For this year, ASML is projecting a margin of about 56%. ASML shares trade 5% lower at 1,452.60 euros amid a broad selloff of stocks exposed to AI.

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