ASML experienced accelerated growth in 2025 with soaring orders, driven by the expanding AI and memory chip markets. While the stock is not cheap, its dominance in lithography systems for AI chips supports its higher valuation. ASML’s stock has doubled in the past year, and its potential for further growth is promising.

ASML is a key player in the AI infrastructure market, producing lithography systems essential for advanced chip manufacturing. Its EUV systems are used by top foundries like TSMC, Samsung, and Intel to produce cutting-edge chips. ASML’s position as a crucial supplier in the AI chip market points to future growth potential.

The memory market’s recovery in 2024 and 2025, driven by stabilized PC and smartphone markets and increasing demand for AI chips, has benefited ASML. Its sales of lithography systems to memory chipmakers like Micron have increased, aligning with the overall growth in the AI and memory chip markets.

ASML raised its 2026 revenue guidance after a strong performance in 2025, with a 16% increase in net sales and a 28% rise in EPS. The company’s backlog surged in the second half of 2025, leading to higher revenue expectations for 2026. ASML is well-positioned for continued growth in the AI and memory chip markets.

Analysts project a 22% CAGR in EPS for ASML from 2025 to 2027, supporting its premium valuation. Despite trading at 42 times this year’s earnings, ASML’s monopoly in the EUV market, global semiconductor market position, and exposure to the booming AI and memory chip markets justify its higher valuation.

Read more at Nasdaq: 3 Reasons ASML Stock Could Soar in 2026