ASML saw a clear re-acceleration at the end of 2025, with fourth-quarter net bookings hitting a record high of EUR 13.2 billion, including EUR 7.4 billion in EUV orders. The company ended the year with a backlog of EUR 38.8 billion. Management expects sales of EUR 34 billion-EUR 39 billion in 2026, driven by EUV growth.

Demand remains strong across the board for ASML, with TSMC adding more 3nm capacity and ramping up 2nm production. The DRAM market is tight on capacity, leading to expectations of more fabs and tool orders in the next two years. Memory makers are also transitioning more DRAM layers to EUV technology.

Despite positive outlook, ASML shares are deemed overvalued. The current 45 times forward PE multiple reflects high investor expectations for 2026, 2027, and potentially 2028. The company is expected to expedite shipments and shorten lead times to meet high demand. Sales of EUR 37.6 billion are projected for 2026, with further revenue growth of 14% in 2027.

ASML’s announcement to reduce 1,700 net positions with a focus on increasing engineers and decreasing managers is viewed positively. The move is seen as fostering innovation and agility, which are crucial for the company’s long-term success built on engineering capabilities. This reflects ASML’s commitment to maintaining a competitive edge in the industry.

Read more at Morningstar: ASML Earnings: Record Bookings Confirm the AI Upcycle Into 2027