ASML, the renowned Dutch semiconductor equipment manufacturer, has recently reported promising figures that have positively influenced investor confidence. The company anticipates revenue growth in 2026, largely driven by an increasing demand for AI chips.
Surge in New Orders and Financial Performance
ASML released its third-quarter results, revealing a revenue of €7.5 billion. This figure aligns with the company’s expectations, which were set between €7.4 billion and €7.9 billion. The gross margin stood at 51.6%, slightly above the anticipated range of 50% to 52%.
In terms of new orders, ASML secured €5.4 billion in the last quarter. This marks a significant increase compared to the €2.6 billion in new orders recorded during the same period last year. Management attributed the higher-than-expected demand for machines essential in the production of AI-related products as a primary driver.
Optimistic Outlook for Future Revenue Growth
For the entire fiscal year 2025, ASML forecasts a revenue of €32.5 billion, reflecting a year-on-year growth of 15%. The company also expects its gross margin to reach 52%. Looking ahead to 2026, ASML remains optimistic, predicting revenue growth bolstered by substantial global investments in AI.
- 2025 Revenue Forecast: €32.5 billion
- 2025 Year-on-Year Growth: 15%
- 2025 Gross Margin Projection: 52%
Despite a potential decrease in demand from China, ASML believes this can be offset by the robust investments in AI technology worldwide. The increased activity in this sector should support overall growth moving forward.
Shareholder Returns and Stock Buyback Program
ASML also provided an update regarding shareholder returns, indicating that €148 million worth of shares were repurchased in the third quarter. To date, under the current buyback program running until the end of 2025, the company has repurchased shares totaling €5.9 billion. A new buyback program is expected to be announced in early January.
Investment Analysis and Future Projections
The outlook for ASML remains positive, with a “buy” recommendation for investors. The company envisages a revenue of €55 billion by 2030, accompanied by a gross margin in the high 50% range. If ASML continues its share repurchase strategy, the projected earnings per share could reach €55 by the end of the decade.
At a reasonable price-to-earnings ratio of 27 for this near-monopoly leader, the expected stock price could be around €1,485. For 2026, a price-to-earnings ratio of 34 reinforces the ongoing buy advice on ASML.
| Financial Metrics | 2024 | 2025 |
|---|---|---|
| Revenue (€ billion) | 7.5 | 32.5 |
| Gross Margin (%) | 50.8 | 52 |
| New Orders (€ billion) | 2.6 | 5.4 |
ASML is well-positioned to benefit from the rising tide of AI demand, delivering significant value to its investors in the coming years.
