ASML Books a Record Quarter as Customers Chase 2029 and 2030 Lithography Capacity

ASML published third-quarter 2026 results on 14 October that beat on profit and on guidance. Total net sales reached a record EUR 11.66-11.7 billion, up from EUR 9,326 million in the second quarter and towards the high end of guidance, while net income came in at EUR 4.96 billion against EUR 2,918 million in the prior quarter and EUR 2.125 billion a year earlier, roughly EUR 800 million above consensus. Gross margin was 57.5%, ahead of both guidance and the 56.1% expected, helped by installed base management sales of EUR 3.3 billion against EUR 2,762 million, driven by demand for productivity upgrades. The company sold 113 new lithography systems and eight used systems, against 86 and five respectively in the second quarter.

The guidance was more striking than the quarter. ASML raised its full-year 2026 target to EUR 44-45 billion from EUR 43-45 billion, lifted the gross margin outlook to about 56% from 54-56%, and guided fourth-quarter sales of EUR 14.2-15.2 billion with margin near 57%. It also expects EUV revenue to grow more than 45% this year and non-EUV revenue about 20%. CEO Christophe Fouquet said customers keep raising short- and medium-term equipment demand forecasts on their view of AI investment, and that given the visibility, some customers are expressing interest in placing orders for 2029 and even 2030. On that basis, ASML now expects its currently planned 2027 and 2028 supply will not fully meet demand and is investigating raising 2028 capacity beyond the 30% increase previously communicated - the July plan already took low-NA EUV annual shipment capacity to about 85 units, with UBS and Morgan Stanley pencilling more.

The roadmap detail matched the demand signal. TSMC has now essentially confirmed it will introduce High-NA EUV into high-volume manufacturing around 2030, joining Samsung and Intel, and TSMC and ASML are working on 12-inch photomasks to unlock High-NA EUV's full-field potential. ASML bought back about EUR 4.1 billion of shares in the quarter and will pay an interim dividend of EUR 1.88 per share on 4 November. The stock nevertheless fell more than 4% in US after-hours trade, with investors still debating whether AI capital spending can be sustained - a debate sharpened this week by Broadcom's chief executive comparing industry sentiment to a casino.