What To Expect From ASML In 2026?

ASML (NASDAQ: ASML), the Dutch semiconductor equipment leader and monopoly supplier of EUV lithography, kicks off 2026 on a strong note. After a turbulent 2025, the stock has surged nearly 16% in the first week of January, fueled by a flurry of analyst upgrades and price targets reaching as high as $1,500. Here are the pivotal trends that could shape ASML’s outlook this year.

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High-NA EUV

The semiconductor industry has officially entered the High-NA (Numerical Aperture) EUV era. These next-generation lithography machines are the most complex and expensive manufacturing tools ever built, costing roughly $380 million per system. Their importance goes far beyond price. High-NA EUV enables chipmakers to print features roughly twice as small as today’s EUV systems, making it essential for future nodes such as 1.4 nm and eventually 1 nm. Without High-NA, continued transistor scaling for advanced AI processors becomes economically and technically unviable.

Adoption will move from theory to reality. Intel has completed acceptance testing for its first High-NA systems intended for mass production, while Samsung has begun taking delivery for its upcoming 2nm foundry lines. Although the cost of these machines is high, their technical necessity in the AI arms race is forcing leading-edge manufacturers to commit. For ASML, this marks a structural shift toward a higher-margin, longer-duration revenue stream. No competing company can build these tools, making High-NA EUV one of the strongest competitive moats in industrial history. This could effectively lock in ASML’s relevance for the next decade.

China Normalization

China has been one of ASML’s largest customers recently, accounting for over 40% of sales during 2024–2025. That demand surge, however, was driven by stockpiling as Chinese chipmakers rushed to acquire tools and machinery ahead of expanding export controls. In 2026, that cycle has clearly turned. Tighter Dutch and U.S. restrictions now limit shipments not only of advanced EUV systems but also high-end DUV immersion tools. As a result, Chinese revenue is expected to decline meaningfully this year, creating what could be a temporary “air pocket” in regional sales.

That said, management has guided that total 2026 net sales are not expected to fall below 2025 levels, implying that demand from other regions, including Taiwan, the United States, and Korea, is strong enough to absorb the China slowdown. In effect, geopolitical pressure is reshaping where ASML sells its tools, not whether those tools are needed. This guidance provides a floor under expectations and suggests that ASML’s valuation is increasingly supported by global leading-edge investment rather than regional policy-driven demand swings.

The DRAM and HBM Upcycle

Generative AI demand is not limited to processors. Every AI server requires vast amounts of high-bandwidth memory (HBM), and this is making memory manufacturing a critical bottleneck in the AI supply chain. This has triggered a sharp upcycle in advanced DRAM and HBM investment. Memory leaders such as SK Hynix and Micron are rapidly expanding EUV-based production capacity to meet surging demand from data center customers. As HBM content per server continues to rise, memory fabs are becoming just as EUV-intensive as logic fabs.

For ASML, this is strategically important. It expands the company’s growth drivers beyond logic customers such as TSMC and Intel and adds a second, independent engine through memory manufacturers. The memory recovery is likely to be a key reason ASML’s order book remains resilient through 2026, even as consumer electronics demand stays relatively soft.

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