MW Struggling to keep pace with demand, ASML raises outlook after barnstorming first quarter

By Jules Rimmer

ASML CEO announces a beat and a raise with strong 1Q 2026 results

Despite recent overall market weakness ASML shares have performed well and 1Q2026 results should reinforce that trend

"The supply will not meet the demand for the foreseeable future", was how ASML's chief executive officer, Christophe Fouquet, characterized the prospects for his company in 2026, after announcing a beat and a raise for the first quarter.

Amid the strong set of results for Europe's largest company by market capitalization, the figure that will attract the attention of analysts and investors is the increase in forecast revenues for 2026 from the previous range of EUR34 billion to EUR39 billion to a new range of EUR36 billion to EUR40 billion, lifting the mid-point by around 4%.

Management signalled that 2026 should demonstrate growth across all business divisions and the stock (NL:ASML) responded favorably with a gain of 1.6% to EUR1304 in Wednesday trading.

Released Wednesday, ASML's first quarter net profit was EUR 2.76 billion ($3.25 billion) with earnings per share of EUR7.15 considerably higher than the EUR6.60 analyst consensus, according to FactSet.

Revenues at EUR8.8 billion were also better than the EUR8.7 billion the street expected and, in a note published after the release by Jefferies analyst Janardan Menon, this is liable to push estimates "modestly" higher.

Management was keen to emphasize that their forecasts already incorporate the possibility of export restrictions imposed by governments on sales of its products to China. "The bandwidth in our 2026 guidance accommodates potential outcomes of ongoing discussions around export controls," Fouquet said.

ASML confirmed trends indicated recently by TSMC that demand for semiconductor chips from the AI sector remains extremely robust. Manufacturing state-of-the-art lithography machines used in the production of the advanced semiconductor chips, ASML noted a healthy order book and the key takeaway from the results presentation was straightforward: chip demand exceeds supply.

ASML's largest customers like TSMC $(TSM)$ and Samsung Electronics (KR:005930) are indicating their 2026 capacity is pretty much sold out and they envisage these supply constraints to extend into 2027.

Encouragingly for ASML, the semiconductor manufacturers are constructing new fabs, involving more sophisticated technologies with ever more complexity in chip manufacture. This benefits ASML as their advanced production tools and cutting-edge lithography machines remain highly sought after. However, on the call Fouquet stressed that its less advanced, non-extreme ultraviolet lithography sales were rising, in contrast to previous expectations he had communicated.

Although Jefferies analyst Menon rates ASML a hold and his target price of EUR1260 is just below the shares current level, most analysts are more positive on the stock. The majority of those supplyimng estimates to FactSet have a buy recommendation and the mean target price, before today's release and any potential upgrades, was EUR1426, roughly 10% above current levels.

ASML's Nasdaq-listed depositary receipts $(ASML)$ have rallied 42% so far in 2026 and throughout recent geopolitical volatility and market weakness have performed well. In pre-market trading Wednesday, the ADRs were 0.4% higher at $1524.

-Jules Rimmer

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April 15, 2026 05:20 ET (09:20 GMT)

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