Start here if you're new
what it is
ASML sells the lithography machines that print chip patterns onto silicon.
how it gets paid
Last year Asml N.V made $38.3B in revenue. DUV systems was the main engine at $15.3B, or 40% of sales.
what just happened
ASML missed EPS by $0.26 on one print, while 2025 sales reached about €32.7B—roughly consistent with the ~$38.3B USD segment table here after FX (not dollar-for-dollar the same line).
At a glance
A-grade balance sheet — strong enough to weather a downturn
75/100 earnings predictability — reasonably predictable
46.8x trailing p/e — you're paying up for this one
0.7% dividend yield — cash in your pocket every quarter
45.0% return on capital — every dollar works hard here
xvary composite: 75/100 — average
What they do
ASML sells the lithography machines that print chip patterns onto silicon.
ASML sits in the middle of chipmaking. You do not buy these machines from a backup plan; you buy them because there is no real substitute. ASML sold 48 EUV systems in 2025, and those are the tools chipmakers need for the hardest nodes.
How they make money
$38.3B
annual revenue
EUV systems
$12.3B
+16.5%
DUV systems
$15.3B
+14.0%
Installed base management
$7.7B
+10.0%
Services and software
$3.1B
+16.0%
The products that matter
sells chipmaking systems
Lithography Systems
€23.1B · 71% of revenue
This is the core machine business. It generated €23.1B in 2025 and grew 8%, which still makes it the center of gravity.
71% of revenue
services and software support
Installed Base Management
€9.6B · 29% of revenue
This €9.6B segment grew 12% in 2025. It is smaller than systems, but it gives ASML a steadier revenue stream once the machines are already on customer floors.
faster growth
Key numbers
$2095
18-mo target
That is 54% above the current $1,357.42 price. The gap is big enough to matter.
46.8x
trailing p/e
You pay 46.8 times trailing earnings here. That is a high price for a machine seller, even one this strong.
41.0%
operating margin
ASML keeps 41.0 cents from every sales dollar after operating costs. That is a toll booth, not a normal factory.
45.0%
return on capital
ASML turns invested money into profit at a 45.0% rate. That is why the business earns its premium.
Financial health
A
strength
- balance sheet grade A — very strong financial position
- risk rank 3 — safer than 50% of stocks
- price stability 35 / 100
- long-term debt $2.7B (1% of capital)
- net profit margin 35.0% — keeps 35 cents of every dollar in revenue
- return on equity 46% — $0.46 profit for every $1 investors have put in
A with balance sheet grade and net profit margin standing out. your money faces less risk here than at most public companies.
Total return vs. market
You invested $10,000 in ASML 3 years ago → it's now worth $22,960.
The index would have given you $14,540.
source: institutional data · total return
What just happened
missed estimates
ASML missed EPS by $0.26, even as 2025 sales reached €32.7 billion.
December-quarter net bookings hit about €18.2B (euros—do not mix with the USD segment table without converting). That pace was more than double the prior quarter.
€32.7B
revenue (FY25 · EUR)
$8.54
eps (USD · same print as miss)
52.2%
gross margin
bookings
December-quarter net bookings near €18.2B were the demand signal—bookings are forward-looking and not the same as recognized revenue.
-
asml holding is seeing a shift in the underlying demand environment.
-
for most of 2025, ai infrastructure announcements did not translate into orders.
-
that changed in the last months of the year, as december-quarter net bookings reached about €18.2 billion, more than double what was recorded in the prior quarter.
-
customers across both logic and memory shifted from planning to making commitments.management noted that customers had become more confident in the sustainability of ai-related demand, and this was directly reflected in capacity plans.
-
memory manufacturers led the booking composition for the first time, accounting for 56% of orders as demand for high-bandwidth memory drove dram producers to act quickly.
source: company earnings report, 2026
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What could go wrong
the #1 risk is customer concentration in leading-edge wafer fab spending. ASML has the monopoly product, but a short list of customers controls the budget.
med
Customer concentration
TSMC, Samsung, and Intel drive 70%+ of revenue. If one of them delays a fab build or equipment order, the effect shows up quickly.
This is not abstract concentration risk. It sits on top of a €32.7B revenue base and directly affects the machine business that still makes up 71% of sales.
med
Visibility risk inside 2026 guidance
Management's €34–39B sales guide spans €5B. That's a wide range for a company valued like demand is already settled.
If results drift toward €34B instead of €39B, the premium multiple has less support. At 46.8x earnings, the market is not paying for ambiguity.
med
China export restrictions
U.S. and Dutch export controls already limit what ASML can ship to Chinese customers. The page data ties that exposure to roughly 15% of the addressable market.
Tighter rules would not break the moat, but they would cap where part of future demand can go.
Put the risks together and you get a simple math problem: 70%+ customer concentration plus a €5B guidance range is a lot of operating leverage for a stock on 46.8x earnings.
source: institutional data · regulatory filings · risk analysis
Pay attention to
calendar
Q1 2026 earnings
Management guided to €8.2–8.9B in sales and gross margin above 51%. If they miss either side, the market will hear it as a demand signal, not a one-quarter blip.
trend
whether the €18.2B bookings spike sticks
One huge quarter matters. Two starts to look like a cycle turn. You want to see follow-through from both logic and memory customers.
risk
customer capex budgets
TSMC, Intel, and Samsung are effectively ASML's demand dashboard. Any cut or delay from that group matters more than broad semiconductor sentiment.
metric
installed base mix
Installed Base Management already contributes €9.6B and grew 12%, faster than systems at 8%. More mix here makes the business steadier and the multiple easier to defend.
Analyst rankings
earnings predictability
75 / 100
This is above average visibility for a semiconductor equipment name. In human-speak, analysts think the business is understandable even if quarterly timing still swings.
risk rank
3
Risk rank is a relative safety score. A 3 says this is not reckless, but it is still tied to capex cycles and customer concentration.
price stability
35 / 100
The business is high quality. The stock is not calm. A 35/100 stability score means you should expect sentiment to move faster than fundamentals sometimes.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 789 buyers vs. 622 sellers in 4q2025. total institutional holdings: 68.2M shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$615
$1720
$1357
current price
$2095
target midpoint · +54% from current · 3-5yr high: $2520 (+85% · 17% ann'l return)
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