ASML Lifts 2026 Sales Outlook on Surging AI Chip Demand, Despite China Challenges

ASML has dialed up its sales forecast for 2026, a move buoyed by robust demand for the AI-driven chip market. The Dutch semiconductor equipment maker exceeded first-quarter revenue and profit estimates, scooping up €8.8 billion in net sales, versus the €8.5 billion Wall Street had penciled in. Net profit landed at €2.8 billion, nudging past the expected €2.5 billion.

The company's new guidance bumps projected 2026 revenue into a €36 billion to €40 billion range, upping the previous band of €34 billion to €39 billion. ASML's CEO, Christophe Fouquet, highlighted that chip demand fueled by AI infrastructure investments continues to outstrip supply, pushing clients to accelerate capacity additions well into 2026 and beyond.

ASML, often considered a barometer for semiconductor health due to its unique position supplying critical chipmaking machinery, has been riding the AI wave hard. Memory chip shortages have spiked prices to record levels, prompting South Korean giants Samsung and SK Hynix to ramp up production, which directly feeds ASML's order book.

Geographically, first-quarter sales showed 45% hail from South Korean clients, with 23% dented by Taiwanese demand. Notably, China sales dipped to 19%, down from 36% in the previous quarter, a clear sign of the mounting effects of export controls blocking ASML's most advanced lithography machines from making their way into the country.

Interestingly, this quarter marked a shift in ASML's reporting tactics: it decided against disclosing order numbers, a traditionally scrutinized metric by investors. Fouquet assured that order intake remains "very strong," even as some market watchers remain cautious about the lack of transparency. Ben Barringer from Quilter Cheviot mentioned the market has already priced in the growth ASML now confirms.

Looking further ahead, ASML signaled potential delivery of 80 low numerical aperture EUV lithography machines in 2027, slightly short of the hoped-for 90 units some investors anticipated. Barclays noted this could temper expectations for the year ahead.

Despite the AI boom, the specter of regulatory hurdles in China looms large. A bipartisan effort in the U.S. Congress aims to further restrict exports of even less advanced chipmaking tools to China, a development that could tighten ASML's exposure in a key market.

The first quarter results underscore a semiconductor sector in flux - AI chips pushing demand to new heights, mixed with geopolitical friction complicating supply chains. With ASML's pivotal role in enabling the next generation of chips, how the company navigates these challenges may set the tone for the tech industry's pulse over the coming years.