ASML hikes sales forecast on strong AI chip demand

ASML on Wednesday raised its guidance for the second time this year as its customers continue to ramp up production of AI chips.

The Dutch semiconductor-equipment maker said it now expects full-year sales to come in between 43 billion euros ($49 billion) and 45 billion euros, and a gross margin of between 54 and 56%. It previously predicted annual net sales of between 36 billion and 40 billion euros, and a gross margin between 51% and 53%.

Here’s how ASML did versus LSEG consensus estimates for the second quarter:

• Net sales: 9.3 billion euros versus 8.8 billion euros expected
• Net profit: 2.9 billion euros versus 2.6 billion euros expected

ASML — Europe’s most valuable company — is the only company in the world that makes extreme ultraviolet (EUV) lithography machines used to produce the most advanced semiconductors.

CEO Christophe Fouquet said order intake remained “extremely strong” in the first half of the year. That momentum means the company will target adding 30% to its 2026 low NA EUV capacity and 30% to its 2026 Deep Ultraviolet (DUV) immersion capacity, he said.

ASML had already raised its guidance last quarter on continued demand for its highest-end EUV machines. This is expected to remain high as chipmakers expand production capacity to meet the needs of the AI boom.

The company’s customers continue to “accelerate their capacity expansion plans,” CEO Fouquet said in a Wednesday statement. “This is translating into customer commitments across our product portfolio, providing ASML with increased visibility into longer-term demand.”

Earlier this week, Taiwan Semiconductor Manufacturing Co (TSMC), one of ASML’s largest customers, reported a 68% jump in June sales on the back of strong demand for its chips.

TSMC is planning to add two advanced chip packaging plants in the Chiayi Science Park in southern Taiwan, Reuters reported, citing remarks made by Taiwan’s National Science and Technology Council Minister Wu Cheng-wen on Sunday.

UBS analysts said in a July 10 note that the buildout in semiconductor fabrication facilities, as well as AI-driven demand for leading-edge chip production, is expected to help ASML see a stronger second half of the year.

Despite robust demand, semiconductor stocks have come under pressure as investors question whether the huge AI-driven capital spending can be sustained. ASML also faces tightening restrictions on export controls of its advanced chip equipment.

The company said it will provide an update on its longer-term goals at a Capital Markets Day on June 10 next year.