(Jan 28): ASML Holding NV shares soared to the highest ever after orders in the fourth quarter far exceeded analysts’ expectations and the Dutch semiconductor equipment maker announced job cuts to boost efficiency.
Bookings in the fourth quarter were a record EUR13.2 billion (US$15.8 billion or $19.9 billion), as artificial intelligence (AI) fuelled demand for its most sophisticated equipment, the Veldhoven, Netherlands-based company said in a statement on Wednesday. That compares with an average analyst estimate of EUR6.85 billion, according to data compiled by Bloomberg.
ASML, Europe’s most valuable company, separately announced it plans about 1,700 job cuts, mostly in the Netherlands with some in the US, as it seeks to streamline the organisation. That represents about 4% of the company’s workforce.
“The last three months have brought a lot of clarity” about what AI means for the semiconductor industry, chief executive officer Christophe Fouquet said in an interview with Bloomberg TV. “Our customers start to believe that this AI demand is sustainable, and therefore they are moving to building capacity, and they are moving very aggressively.”
ASML’s shares had gained 4.5% to EUR1,272.60 as at 3.02pm in Amsterdam, extending their year-to-date gain to 38%. The stock previously rose as much as 7.5% to a record intraday high. US peers Lam Research Corp, Applied Materials Inc and KLA Corp were up in pre-market trading. Japanese suppliers to ASML, including Tokyo Electron Ltd, also posted big gains.
Net income in the fourth quarter was EUR2.84 billion, the company said.
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ASML is the only producer of cutting-edge lithography machines that are needed to make advanced semiconductors, and counts all the leading chip manufacturers as customers, including Taiwan Semiconductor Manufacturing Corp (TSMC) and Intel Corp. Its machinery is integral to producing the Nvidia Corp AI accelerators that are the backbone for training and running AI models in data centres. The Dutch company’s bookings are one signal of chipmakers’ confidence in future AI demand.
The AI boom has continued into 2026, defying concerns about over-investment and helping push ASML’s market value over US$500 billion this month. Meta Platforms Inc and Microsoft Corp are among the companies that are pouring hundreds of billions of dollars into building data centres, driving chipmakers to increase capacity and in turn stoking demand for ASML’s products. TSMC said this month it anticipates capital spending of more than US$52 billion in 2026, much of which will be towards advanced manufacturing techniques.
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More than half of last quarter’s bookings were for extreme ultraviolet, or EUV, lithography machines, totalling EUR7.4 billion, ASML said. It recognised revenue in the period for two High NA EUV machines, its latest tool that costs upwards of EUR350 million a piece.
Total net sales were EUR32.7 billion in 2025. Revenue is seen at between EUR34 billion and EUR39 billion this year, higher than previous guidance.
“ASML has knocked it out of the park when it comes to order numbers,” Ben Barringer, the head of technology research at Quilter Cheviot, said. “Given the strength of the order book, we fully expect it to raise guidance throughout the year.”
The company also announced a new share buy-back programme of as much as EUR12 billion through the end of 2028. That amounts to about 2.5% of ASML’s current market capitalisation.
Last week, Nvidia’s CEO Jensen Huang called the rush to build data centres that can power AI models the “largest infrastructure build out in human history”. There is a need for “trillions of dollars” of additional investment in coming years, Huang said at the World Economic Forum’s annual meeting in Davos.
China remained ASML’s biggest market in the fourth quarter, accounting for 36% of net system sales. The Chinese market is expected to fall to about 20% of revenue going forward, chief financial officer Roger Dassen said in a call with reporters.
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ASML has never been able to sell its EUV lithography machines to China due to US-led restrictions aimed at curbing the Asian nation’s progress in the semiconductor sector. It is also restricted from selling its most advanced deep ultraviolet, or DUV, tools to the country. The machines it ships to China are eight generations behind most sophisticated model. Still, Chinese chipmakers have been buying up older equipment to make mature chips.
ASML won’t report bookings in future quarterly reports because the company argues the metric doesn’t accurately capture business momentum.
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