BN Portfolio: ASML raises 2026 sales forecast as AI demand fuels growth

Key topics:AI boom lifts ASML Holding NV sales outlookChip demand outpaces supply as AI spending surges globallyChina export curbs pose risks despite strong growth outlook.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox every morning on weekdays. Register here.Support South Africa's bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Sarah Jacob.ASML Holding NV raised its full-year sales forecast as the surge in global artificial intelligence spending fuels semiconductor production and boosts demand for the company’s advanced chipmaking machines.Net sales will be between €36 billion ($42.4 billion) to €40 billion this year, the Dutch company said in a statement Wednesday. That compares to a previous range of €34 billion to €39 billion.ASML’s customers are racing to ramp up chip production this year to meet demand from big tech companies building out AI capacity. US tech firms have pledged more than half a trillion dollars in capital spending in 2026, and ASML is the only company that makes the advanced lithography machines that are necessary to produce the cutting-edge semiconductors they need..Read more:.FT: ASML forecasts bumper sales on back of AI boom.“We expect in fact that the supply will not meet the demand for the foreseeable future,” Chief Executive Officer Christophe Fouquet said in a video released with the results. “This is creating a strong constraint in the end markets from AI to mobile and PC.”The improved outlook was tempered by a weaker-than-expected sales forecast in the second quarter. ASML, Europe’s most valuable company, sees net sales in the second quarter of €8.4 billion to €9 billion. That compares to analyst estimates of €9.07 billion, according to data compiled by Bloomberg.ASML’s shares gained 0.4% to €1,289.40 at 9:11 a.m. in Amsterdam. The stock has risen 40% this year as some of the world’s biggest companies, including Microsoft Corp. and Alphabet Inc., and startups like OpenAI and Anthropic PBC plan to spend trillions of dollars on infrastructure to support AI software. To accommodate the boom, ASML customers like chipmakers Taiwan Semiconductor Manufacturing Co. and Samsung Electronics. Co. are investing in production. TSMC in January announced capital spending of as much as $56 billion for this year. South Korean chipmaker SK Hynix Inc. outlined plans to spend about $8 billion on ASML’s cutting-edge tools in a deal that runs through 2027. ASML expects to produce at least 60 of its second-most advanced tools, known as low NA extreme ultraviolet lithography machines, this year. “We’re increasing our move rate really quarter on quarter,” Chief Financial Officer Roger Dassen said in the video, adding that the company can produce at least 80 low NA EUV units in 2027. “ASML is expanding its capacity but stopped short of committing to 90 EUV low NA for 2027,” Barclays analysts including Simon Coles said in a note. Investors have been preoccupied with potential semiconductor supply constraints in recent months and ASML’s ability to provide tools to keep pace with chipmakers’ demand.The toolmaker also faces geopolitical headwinds in China, its largest market last year. US lawmakers this month proposed legislation that would curb sales of all of ASML’s deep ultraviolet immersion lithography, or immersion DUV, tools to China and includes banning engineers from servicing tools at certain facilities there.ASML has never been able to sell its most-advanced EUV tools to China due to US restrictions aimed at curtailing Beijing’s technology advances. The Dutch government imposed export controls on some DUV machines to the country in 2024. “We expect that the bandwidth in our 2026 guidance accommodates potential outcomes of ongoing discussions around export controls,” Fouquet said.China accounted for 19% of net system sales in the first quarter, down from 36% in the fourth quarter. The company has previously said it expects China to contribute about 20% of its revenue.What Bloomberg Intelligence SaysASML can achieve its upgraded sales target of €36-€40 billion in 2026, about 4% higher at the midpoint from the previous €34-€39 billion. The company said the revised goal considered the possibility of further controls on China exports, indicating the impact is expected to be limited. Robust demand for ASML’s lithography tools can continue into 2027 due to rising AI chip demand. — BI analysts Masahiro Wakasugi and Takumi Okano The company expects its less advanced non-extreme ultraviolet lithography, or non-EUV, business to increase, in contrast to expectations from its most recent outlook.“The 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,” Jefferies International analyst Janardan Menon said in a note. This could partially reflect accelerated buying in anticipation of new US curbs, he added.ASML net sales last quarter rose 13% from a year earlier to €8.77 billion, meeting analyst estimates. South Korea was ASML’s largest market in the period. Net income was up 17% to €2.76 billion. .Read more:.ASML surges as AI boom fuels record chipmaking machine demand.Wednesday’s report didn’t include orders, a widely-scrutinized metric that was seen as a key indicator of customer demand. ASML said in early 2025 it would drop the metric this year, arguing that was volatile and didn’t accurately reflect business momentum. ASML in January announced plans to cut about 1,700 jobs, mainly in its technology and IT units. Fouquet said at the time the company needed to be more “agile.”.© 2026 Bloomberg L.P.

BN Portfolio: ASML raises 2026 sales forecast as AI demand fuels growth

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