ASML Holding (NASDAQ:ASML) has adjusted its inclusion and diversity targets in the U.S. to align with new regulations from the Trump administration.
This decision comes as the administration has imposed penalties on certain diversity, equity, and inclusion (DEI) initiatives, deeming them discriminatory and detrimental to merit-based systems.
Despite these changes in the U.S., ASML’s diversity and key performance targets will remain in effect for all other markets. The company’s primary DEI goals include increasing women in senior leadership to 14% by 2026 and targeting 24% representation of women in new hires and promotions by 2025.
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The U.S. constitutes a significant portion of ASML’s global workforce, with 8,480 full-time equivalent employees out of a total of 44,027, as cited by Reuters from the company’s latest annual report.
Even with the policy shift, the chip equipment manufacturer affirmed to Reuters its continued commitment to hiring the most qualified candidates based on their merit.
This development follows previous restrictions imposed by Washington, which have prevented companies like ASML and Taiwan Semiconductor Manufacturing (NYSE:TSM) from exporting advanced semiconductor technology to China, citing national security concerns. Additionally, the Trump administration’s tariff policies have spurred these companies to bolster their manufacturing presence within the U.S.
ASML’s stock has shown strong performance this year, surging 16% year-to-date and outperforming the Nasdaq 100’s 9% close. The Netherlands-based company is a leader in developing advanced lithography machines crucial for next-generation chip production.
In a forward-looking move, Executive Vice President Jos Benschop stated that ASML and its exclusive optics partner, Carl Zeiss, are exploring designs for single-exposure circuit printing at 5-nanometer resolution. This advanced technology is aimed at meeting industry demands starting around 2035.
However, the adoption of ASML’s high numerical aperture (NA) machines for advanced chip nodes is still being evaluated by chipmakers such as Taiwan Semiconductor.
Due to the substantial costs involved, Kevin Zhang from Taiwan Semiconductor has indicated that these high-NA EUV tools would not be used for the A16 node, with the company preferring lower-NA EUV solutions.
In contrast, Intel (NASDAQ:INTC) plans to incorporate high-NA EUV machines for its 14A process, aiming to boost its foundry business, though it may also continue to offer older technologies to its customers.
Analyst sentiment towards ASML remains positive, with fourteen analysts setting a consensus price target of $836.71. Notably, JP Morgan issued the highest target of $1,100 on January 30, 2025. More recent targets from Wells Fargo and Susquehanna average $898.33, suggesting a potential 13.42% upside from current levels.
Price Action: ASML stock is trading lower by 0.65% to $796.86 premarket at last check Friday.
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