ASML Shares Surge as Record Performance Captivates Markets

The Dutch semiconductor equipment manufacturer ASML Holding NV is commanding significant attention from investors following an exceptional quarterly earnings report. Market analysts are responding with a wave of upgraded price targets, reflecting growing confidence in the company’s trajectory. Berenberg, for instance, dramatically raised its target from €735 to €1,050, with other financial institutions expressing similar bullish sentiment.

Exceptional Third Quarter Results

ASML’s third-quarter financial performance provided a solid foundation for this market enthusiasm. The company reported revenue of €7.5 billion and net income of €2.1 billion, while maintaining a robust gross margin of 51.6%. Operational highlights included the sale of 66 new lithography systems and the booking of €5.4 billion in new orders. A substantial portion of these orders, €3.6 billion, was for the company’s highly advanced and profitable EUV (extreme ultraviolet) systems.

This EUV technology represents ASML’s core competitive advantage. These cutting-edge lithography systems face virtually no direct competition and are essential for manufacturing the most sophisticated semiconductors currently available. Any company aiming to produce next-generation chips must utilize ASML’s technology.

Widespread Analyst Optimism

The investment community has reacted with pronounced positivity. Deutsche Bank elevated its price objective to €1,050, while Berenberg set an even higher target of €1,100. Both Morgan Stanley and Mizuho Securities issued comprehensive upgrades to their assessments. This collective optimism stems from ASML’s strategic positioning to capitalize on the artificial intelligence boom and the concurrent rise in demand for memory chips.

Market experts point to several reinforcing factors, including ASML’s strong collaborative relationships with industry leaders like TSMC and signs of stabilization at Intel. These are complemented by improving profit margins and a reduction in operational expenditures—a combination that is particularly appealing to investors.

Should investors sell immediately? Or is it worth buying ASML?

Artificial Intelligence as a Primary Growth Driver

Company leadership has expressed a confident outlook for the coming periods. The investment surge driven by artificial intelligence is expanding beyond the largest chip manufacturers to encompass a broader client base. Demand is accelerating for both state-of-the-art logic chips and advanced memory chips.

For the final quarter of the year, ASML has provided a revenue forecast ranging between €9.2 billion and €9.8 billion. Looking further ahead, the company anticipates that the full 2025 fiscal year will conclude with revenue growth of approximately 15%.

Monitoring Potential Headwinds

Despite the overwhelmingly positive indicators, one potential challenge remains on the horizon. ASML anticipates a notable softening of its business in China during 2026. Following what are expected to be strong performances in 2024 and 2025, sales in the Chinese market are projected to decline noticeably. Nevertheless, management maintains confidence that overall performance in 2026 will not fall below 2025 levels.

The consensus among financial analysts is unequivocal. The average price target for ASML shares has climbed from approximately €809 to €938. Given the company’s dominant market position and promising future prospects, this upward trend appears poised to continue.