ASML exceeds Q2 expectations due to demand for AI chips

ASML Raises Financial Forecast Amid AI Demand

On July 15, ASML, the largest manufacturer of computer chip production equipment globally, announced an increase in its financial outlook for 2026. The boost comes as a result of higher than expected profits driven by demand for artificial intelligence (AI). The company plans to expand its production capacity as well.

The company, which boasts the highest market capitalization in Europe, now predicts full-year 2026 net revenues will reach between 43 billion euros and 45 billion euros (about $49 billion to $51 billion). This marks a significant rise of 16% from its previous estimate, which was in the range of 36 billion euros to 40 billion euros.

For the quarter ending on June 30, ASML reported sales of 9.33 billion euros, surpassing analyst expectations of 8.8 billion euros. Additionally, the net profit reached 2.92 billion euros, exceeding the anticipated figure of 2.62 billion euros, according to data from LSEG.

Michael Logue, a senior equity analyst at DeGroof Peterkam, commented on the drastic performance changes, expressing curiosity about the newfound production capacity. He remarked, “It’s a huge downturn in performance across the board, and you wonder where they found all this new capacity.”

Following the news, ASML’s shares rose by 5.7% during early trading in Amsterdam.

The Dutch firm intends to increase its production capacity by 30% in each of the next two years. ASML is uniquely positioned as the sole producer of extreme ultraviolet lithography (EUV) equipment, crucial for manufacturing advanced chips. Major clients such as TSMC, Samsung, SK Hynix, and Micron are ramping up their capacity to meet AI-related demands.

Christophe Fouquet, the company’s CEO, indicated that orders stemming from the increasing demand for AI chips are “very strong.” He noted, “Our customers also continue to accelerate their capacity expansion plans, giving ASML greater visibility of long-term demand.”

Moreover, ASML aims to boost its production capacity for its flagship EUV tools and deep ultraviolet (DUV) tools necessary for clients in China. Analysts at JPMorgan believe the latest results will help ASML narrow the valuation gap with its U.S. counterparts. They noted, “The message from the bears has been that production capacity is limited or will not grow… But the company is effectively aiming for 30% growth over the next two years.”

In a separate update, Fouquet mentioned that Intel plans to utilize ASML’s new high-NA tools for manufacturing some next-generation Panther Lake chips, a notable first for that technology.

Despite U.S.-led export restrictions, demand from China remains robust. CFO Roger Dassen reiterated that Chinese customers are expected to account for around 20% of the company’s sales this year. While this percentage has declined compared to past years, the actual sales figures are increasing as overall revenue rises.