ASML (NASDAQ:ASML) reported third-quarter 2025 results showing slightly lower revenue but stronger-than-expected earnings, driven by robust demand for its Extreme Ultraviolet (EUV) lithography systems.
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The chip equipment maker expects 2026 net sales to match or exceed 2025 levels, with growth fueled by continued investment in artificial intelligence infrastructure.
Goldman Sachs analyst Alexander Duval maintained a Buy rating on ASML and raised the price forecast from 935 euros (around $1,091) to 1,050 euros (around $1,226).
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Duval noted that ASML's third-quarter 2025 revenue fell slightly below Visible Alpha Consensus, but its EBIT of approximately 2.5 billion euros came 2% above expectations.
The company booked 5.4 billion euros in orders for third-quarter 2025, largely in line with consensus, including 3.6 billion euros in EUV orders, significantly exceeding the 2.2 billion euros forecast, the analyst said.
He highlighted several key drivers supporting ASML's outlook, including accelerating AI and EUV demand, normalization of China sales offset by strong AI-led growth elsewhere, memory scaling to 4F² boosting EUV intensity, and AI applications driving faster node migration to reinforce long-term lithography demand.
Duval emphasized ASML's 2026 visibility has improved, as the company expects net sales not to fall below 2025 levels.
The analyst cited continued investment in AI infrastructure, expanding AI adoption across more customers, and growing EUV layer usage in Logic and DRAM as positive trends. He noted the strong order intake in recent quarters means the cadence of orders required to meet 2026 estimates is below the historical five-year median, indicating achievable growth.
While ASML anticipates a significant revenue decline from China due to normalization, he stressed robust AI-related demand for EUV tools elsewhere will more than offset this headwind.
Duval highlighted Logic's transition to Gate-All-Around (GAA) transistors progresses without increasing EUV layers.
Memory's adoption of 4F² architecture drives more complex designs and sustained demand for both EUV and DUV systems, the analyst noted.
He pointed out AI workloads are accelerating demand for advanced Logic and DRAM nodes, justifying faster adoption of newer, higher-cost nodes with increased wafer pricing. This structural shift now positions AI rather than smartphones as the primary driver of leading-edge node adoption. The ongoing 2nm ramp exemplifies this trend, with broader AI adoption expected to intensify competition and accelerate migration to advanced process technologies.
Based on these developments, Duval maintained his Buy rating on ASML and raised fiscal 2026–29 revenue and profit estimates by about 1%, reflecting strong Logic and Memory demand, partly offset by lower China contributions.
The analyst also adjusted EBIT estimates up 1%–4% and left EPS forecasts mostly unchanged. The analyst increased his price forecast reflecting ASML's strong EUV positioning, limited competition, and moderate China exposure.
ASML Price Action: ASML Holding shares were trading higher by 0.86% to $1,018.12 at publication on Thursday.
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