Chip gear provider ASML shares drop 11% on cautious 2026 growth outlook

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.

Fouquet said that ASML has so far shipped a single EXE:5200 machine. Compared with its predecessor, the system can provide a “60% productivity improvement.” That allows it to process about 175 wafers per hour. 

Photo: ASML

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