ASML Holding lifted its guidance after reporting quarterly results that beat expectations. The chipmaking-equipment company’s figures weren’t enough to sustain its stock rally but should boost confidence in the artificial-intelligence and memory processor cycles.
Dutch company ASML reported a first-quarter net profit of 2.76 billion euros ($3.25 billion) on revenue of €8.77 billion. Analysts had expected a profit of €2.55 billion on revenue of €8.63 billion, according to a FactSet poll.
ASML said it now expects 2026 sales between €36 billion and €40 billion, up from prior guidance of €34 billion to €39 billion.
ASML holds a near monopoly on lithography machines, which are crucial for manufacturing the most advanced semiconductors.
“Demand for chips is outpacing supply. In response, our customers are accelerating their capacity expansion plans for 2026 and beyond, supported by long-term agreements with their customers,” ASML CEO Christophe Fouquet said in a statement. “In the past months, our customers have increased their expected short- and medium-term demand for our products.”
The large price tag of ASML’s machines means revenue numbers can swing significantly from quarter to quarter, so investors have tended to focus on its longer-term order numbers. However, ASML has said it will no longer disclose quarterly order numbers.
Taiwan Semiconductor Manufacturing, the world’s most important chip manufacturer, recently said it would makeenormous investmentsin production capacity this year and for several years ahead, which has buoyed investor sentiment toward ASML. Memory-chip companies such as South Korea’s Samsung Electronics are also investing heavily in manufacturing.
ASML’s U.S.-listed shares were down 4.5% in premarket trading, having more than doubled in the past 12 months.
One factor likely to come under scrutiny is how much of ASML’s sales come from China. A bipartisan group of U.S. representatives recently introduced a bill to further restrict semiconductor manufacturing equipment sales to China, which could affect ASML’s sales if it is passed into law and agreed with Dutch authorities. The draft Multilateral Alignment of Technology Controls on Hardware (MATCH) Act specifically called out ASML.
“The [earnings] upside seems to be coming mainly in immersion lithography where ASML was previously expecting a decline due to a fall in China sales, but is now expecting an almost flattish trend. This could partially reflect MATCH Act related accelerated buying,” said Jefferies equity sales specialist William Beavington.
“While estimates are likely to rise modestly further towards the high-end of the new range, we expect the valuation multiple to gradually de-rate, limiting share price upside,” Beavington added.
During ASML’s fourth-quarter earnings call in January, the company said it expects Chinese sales to comprise only 20% of 2026 sales. However, it made a similar prediction for 2025 and ultimately derived about a third of its sales from China last year.
“We expect that the bandwidth in our 2026 guidance accommodates potential outcomes of ongoing discussions around export controls,” CEO Fouquet said.
