ASML Earnings Are Coming: Are AI Chipmakers Still Willing to Expand Capacity?

Asian semiconductor stocks just experienced a sharp selloff, with SK hynix, Samsung and Kioxia coming under heavy pressure as investors reassessed future memory supply and pricing power. Now, ASML is set to report its Q3 earnings, offering another important signal about the future of the AI infrastructure cycle. The key question is not simply how much ASML earned this quarter, but whether chipmakers are still willing to spend heavily on capacity they may not need until 2027 or 2028.

ASML's fundamentals remain strong. In Q2, the company reported €9.33 billion in revenue, a 54% gross margin and approximately €2.9 billion in net income. Management previously guided for Q3 revenue of €11 billion–€12 billion and gross margins of 55%–57%. Analysts surveyed by Visible Alpha expect roughly €11.71 billion in revenue and earnings per share of about €10.87. If realized, revenue would grow more than 50% year over year. But with strong growth already priced in, even impressive earnings may not be enough to push the stock higher.

That is why Tiger thinks the most important number in this report may not be revenue or EPS. It may be net bookings.

ASML operates differently from companies like NVIDIA and Micron. NVIDIA's results largely reflect demand for AI computing infrastructure, while memory manufacturers are highly sensitive to changes in pricing and supply. ASML, however, sells the lithography equipment required to manufacture advanced chips. Its customers typically plan factory construction, equipment purchases and production ramps well in advance. That makes ASML's order book an important window into chipmakers' future capital spending intentions.

If TSMC, Samsung, SK hynix and Micron continue placing significant orders for EUV and DUV equipment, it would suggest that manufacturers remain confident about long-term semiconductor demand. But if ASML delivers strong quarterly revenue while new orders begin slowing, investors will need to determine whether customers are delaying expansion or whether the weakness simply reflects the timing of large equipment orders.

There is also an interesting contrast with the recent memory selloff.

One of the biggest risks facing memory stocks is that high margins encourage additional supply, eventually weakening pricing power. For ASML, however, that same capacity expansion can create demand for more manufacturing equipment. In other words, what worries memory investors may initially benefit equipment suppliers.

Still, the relationship is not that simple. If memory prices eventually fall sharply and manufacturers' profitability deteriorates, those companies could also delay equipment purchases. Sustainable demand for ASML depends on more than a temporary rush to expand capacity. It requires continued investment across advanced logic, HBM, DRAM and other semiconductor technologies.

ASML has already signaled confidence in future demand. The company previously outlined plans to increase annual Low-NA EUV production capacity by roughly 30% in 2027, from around 65 systems in 2026, alongside expansion in DUV immersion capacity. It has also been evaluating additional capacity increases for 2028.

The question now is whether management will maintain or strengthen those plans.

If ASML continues highlighting strong customer commitments and provides a more optimistic outlook for 2027 deliveries, investors may gain confidence that AI infrastructure spending remains resilient.

But if bookings weaken, customers delay equipment deliveries or management offers more cautious forward guidance, the stock could come under pressure even if current-quarter earnings beat expectations.

China is another important variable. ASML's EUV exports remain restricted, while certain advanced DUV systems also face regulatory limitations. As China accelerates efforts to localize its semiconductor supply chain, ASML faces both potential demand opportunities and restrictions on what it can sell. Global semiconductor capacity growth therefore does not automatically translate into equivalent order growth for ASML.

Tiger View

Tiger thinks the biggest value of ASML's earnings report is not proving how strong AI demand is today.

It is testing whether semiconductor manufacturers are still willing to commit real capital to the AI demand they expect over the next two to three years.

For much of this AI cycle, investors have focused on GPU orders, HBM pricing and hyperscaler CapEx. But as concerns about AI investment returns grow, another question becomes increasingly important: how confident are manufacturers in the long-term demand behind all this infrastructure spending?

ASML occupies a unique position. Its customers include advanced logic manufacturers such as TSMC and Intel, as well as memory producers including Samsung, SK hynix and Micron. That gives investors a broader perspective on the semiconductor industry's willingness to invest.

Tiger would watch three signals in today's report: whether net bookings, especially EUV orders, remain strong; whether the 2027 Low-NA EUV capacity expansion plan stays intact; and whether management raises its revenue or margin outlook.

If the next phase looks like:

Strong bookings → continued customer expansion → better revenue visibility for 2027,

then the long-term investment case for advanced semiconductor manufacturing could remain intact, even as some memory stocks face valuation pressure.

But if the pattern becomes:

Strong current earnings → weaker new orders → delayed capacity expansion → cautious forward guidance,

then investors may need to reconsider how much future AI hardware growth has already been priced into valuations.

ASML shares have already enjoyed substantial gains this year, which means expectations are high. A company can continue growing rapidly and still disappoint the market if that growth falls short of what investors expected.

So Tiger's biggest question is not:

“How much will ASML earn this quarter?”

It is:

“When chipmakers make investment decisions for 2027 and 2028, do they still believe AI will require significantly more manufacturing capacity?”

Related Stocks

Semiconductor Equipment: $ASML Holding NV(ASML)$

Watch: EUV/DUV net bookings, 2027 capacity plans, gross margins and the outlook for China-related sales.

Advanced Manufacturing: $Taiwan Semiconductor Manufacturing(TSM)$

Watch: demand for 3nm and next-generation process nodes, CoWoS advanced packaging expansion and sustained capital spending. TSMC's October 15 earnings will provide another important checkpoint.

AI Compute: $NVIDIA(NVDA)$, $Advanced Micro Devices(AMD)$

Watch: whether training and inference demand continue supporting investment in advanced semiconductor manufacturing.

AI Memory: $Micron Technology(MU)$

Watch: whether HBM and advanced DRAM capacity expansion drives additional equipment demand, and how future supply affects pricing and margins.

U.S. Foundry: $Intel(INTC)$

Watch: advanced-node development, High-NA EUV adoption and whether manufacturing investments translate into sustainable external customer orders.

Today's Poll

ASML earnings are coming. What matters most for the next phase of AI semiconductors?

① EUV orders stay strong — AI capacity expansion is far from over

② More memory supply could eventually slow chipmakers' expansion plans

③ Advanced logic remains strong, but traditional memory may weaken first

④ Valuations matter more — expectations are already too high

For market discussion only. This is not investment advice. Markets involve risk, and investment decisions should be made carefully.

Sources: ASML Q2 2026 earnings release and management guidance, Visible Alpha consensus estimates, and Investopedia (October 14, 2026). This is a pre-earnings market outlook; forecasts should not be treated as reported results.