After disclosing its fourth-quarter and full-year results for 2025, Dutch lithography equipment giant ASML upgraded its revenue outlook for 2026. The company stated that chipmakers have clearer expansion demands around artificial intelligence (AI), leading to a significant rebound in orders. The market also provided positive feedback at the start of trading.
Guidance Upgrade: 2026 Sales Between 34-39 Billion Euros, Gross Margin Range 51%-53%
ASML expects net sales in 2026 to reach between 34 billion and 39 billion euros, with a target gross margin of 51%-53%. The upper end of this range implies growth potential, interpreted by the market as "AI-driven upward elasticity" persists.
The company also provided a preliminary range for the first quarter of 2026: net sales expected between 8.2 billion and 8.9 billion euros, with gross margins also aiming for 51%-53%.
Strong Orders: Q4 Net Orders of 13.2 Billion Euros, EUV Contributed 7.4 Billion Euros
Orders are the focus of this financial report. ASML disclosed that net order value reached 13.2 billion euros in the fourth quarter of 2025, with 7.4 billion euros coming from EUV (extreme ultraviolet) systems.
Compared quarter-on-quarter, Reuters reported this indicator significantly increased from the previous quarter's 5.4 billion euros, substantially exceeding analyst expectations gathered by Visible Alpha, indicating an "accelerated" pace of client expansion by year-end.
Additionally, the company had an order backlog of approximately 38.8 billion euros at year-end, providing strong visibility for future revenue recognition.
Performance Background: Record Revenue and Profit in 2025, EUV "Moat" Remains Key
In terms of performance, ASML's full-year net sales were about 32.7 billion euros, with a net profit of about 9.6 billion euros, and a gross margin of approximately 52.8%; fourth-quarter net sales were about 9.7 billion euros, with a gross margin of about 52.2%.
Management emphasized in the outlook that clients' judgment of the mid-term market is more positive, primarily based on expectations that AI-related demand will be "more sustainable." Furthermore, ASML's critical position in the EUV equipment required for advanced processes makes order improvements more likely to influence the company's mid-term guidance positively.
Enhanced Shareholder Returns: 12 Billion Euros Buyback + Dividend Increase
Regarding capital returns, ASML announced a new share buyback program up to 12 billion euros, intended to be completed by December 31, 2028.
In terms of dividends, the company plans to declare a full-year dividend of 7.50 euros per share for 2025, an increase of 17% from the previous year.
What the Market is Watching Next
- Will AI Capital Expenditure Continue to Upgrade: AI computing power investments driven by cloud giants directly affect the expansion pace of advanced logic and memory chips.
- Continuity of EUV and Installation Services Business: Beyond order volume increase, service and upgrade income from existing installations will also impact profit resilience.
- Guidance Realization Path: From the Q1 range to the full-year target, the delivery, acceptance, and revenue recognition rhythm in the coming quarters remains a source of volatility.
