Lithography leader ASML has achieved a historic milestone, with its market capitalization surpassing $500 billion for the first time, making it the third European company to reach this level. The company’s stock is leading the European market, driven by surging semiconductor demand fueled by AI and TSMC’s stronger-than-expected capital expenditure.
A core catalyst was TSMC’s announcement that its 2026 capital expenditure will reach $52–56 billion, far exceeding market expectations of $46 billion and representing a 37% year-over-year increase. The strong equipment procurement demand directly benefits ASML. On January 15, ASML’s European stock closed up 6%, bringing its monthly gain to over 24%. Valuation metrics remain attractive—the current share price of $1,163 trades at a P/E of 34x, below the tech sector average of 54x, suggesting further upside potential.
Morgan Stanley holds a strongly bullish view on ASML, listing it as a top pick. The firm optimistically projects the stock could rise 70% to $2,000, with a base-case target of $1,400, among the highest in the industry. It also forecasts 2027 EPS to reach $46, nearly doubling from 2025 levels, highlighting strong growth certainty.
ASML’s technological monopoly forms a formidable barrier, with the company holding over 90% of the advanced lithography market. Its EUV and high‑NA EUV systems are essential for 3nm and below chips, with Morningstar research indicating a technology lead of about a decade over competitors. In the first nine months of 2025, ASML’s revenue grew 21% to nearly €23 billion, EPS increased 40%, gross margins remained stable around 50%, and service revenue rose 39%, demonstrating resilient business performance. According to industry data, ASML plans to deliver 52 low‑NA EUV and 4 high‑NA EUV systems in 2026, with delivery volumes rising to 56 and 10 units respectively in 2027, reflecting a clear ramp‑up trajectory.
High‑NA EUV technology is emerging as a new growth engine, enabling the industry to advance to 2nm and below nodes. This technology simplifies production flows and improves yields. To date, over 300,000 wafers have been processed at customer sites using high‑NA EUV, and the EXE:5200 system has been delivered to clients such as SK Hynix, with the technology set to contribute meaningfully to revenue starting in 2026. Additional tailwinds—including rising memory chip prices, stronger-than-expected demand from China, and the $500 billion funding support from the U.S.-Taiwan trade agreement—provide ample long‑term growth momentum for ASML.
ICgoodFind : ASML’s market cap breakthrough reflects its technological dominance and industry tailwinds. High‑NA EUV technology will continue to unlock growth, securing its long‑term competitive position.
