ASML’s Record €13.2B Bookings Drive 2026 Sales Guidance to €34–39B
ASML reported record Q4 bookings of €13.16B, nearly double expectations, driven by strong EUV system demand, and raised 2026 net sales guidance to €34–39B. The company authorized a €12B buyback through 2028, boosted its 2025 dividend by 17% to €7.50, and plans ~1,700 job cuts to streamline operations.
1. ASML’s Breakout Driven by Record Q4 Bookings
In the fourth quarter of 2025, ASML reported record equipment orders totaling €13.2 billion, nearly double analyst expectations. Notably, 56 percent of those bookings were for memory-chip applications, opening a new growth avenue beyond AI logic chips. This shift provides greater visibility into the order pipeline for the next two years, as major memory foundries accelerate fab expansions. ASML shipped 20 high-NA EUV systems during the quarter, confirming its monopoly in next-generation lithography and underpinning management’s assertion of a 'record year' ahead.
2. Strategic Initiatives to Enhance Operational Agility
To capitalize on surging demand, ASML announced plans to streamline its global workforce by cutting approximately 1 700 roles—around 4 percent of its headcount—primarily in management and coordination functions. This move is designed to accelerate decision-making and free up R&D engineers to focus on high-NA EUV development for future process nodes. Concurrently, the company authorized a €12 billion share buyback program through 2028 and raised its annual dividend by 17 percent to €7.50, reflecting confidence in cash flow generation.
3. Guidance and Financial Outlook
ASML reaffirmed full-year 2026 revenue guidance at €36.5 billion at the midpoint, above consensus forecasts, with gross margins expected to expand toward 53 percent as higher-margin EUV and service revenues grow. Capital expenditures for the year are projected at €2.5 billion to support capacity expansion in Veldhoven and Taiwan. The order backlog stands at €41 billion, providing at least 18 months of revenue visibility and underpinning management’s medium-term target of doubling sales by 2028.
4. Valuation Suggests Caution for Late Buyers
Despite ASML’s unquestioned leadership in extreme-ultraviolet lithography, the stock trades at 44 times forward earnings—well above the 32 times median for semiconductor-equipment peers. This premium reflects investor confidence in the AI-and-memory cycle but leaves limited margin of safety. With most near-term catalysts already priced in and consensus expecting only mid-teens earnings growth next year, investors are advised to monitor order momentum and margin trends before adding new positions.