TLDR
- ASML reported Q3 revenue of €7.5 billion and net income of €2.1 billion, meeting guidance with earnings per share of €5.49.
- The company expects Q4 sales between €9.2 billion and €9.8 billion with up to 53% gross margin, forecasting 15% full-year growth.
- AI-driven demand continues to expand across both leading-edge logic and advanced DRAM customers.
- ASML warned of a substantial drop in China sales starting in 2026, though total 2026 revenue should match or exceed 2025 levels.
- CFO Roger Dassen ruled out customer stockpiling as the cause of declining China sales, stating shipped systems are already operating in chip factories.
ASML shares climbed over 3% in Wednesday morning trading after posting third-quarter results that met company guidance. The Dutch chip equipment maker reported revenue of €7.5 billion for the quarter.
Net income came in at €2.1 billion. Earnings per share reached €5.49, topping analyst expectations of €5.44.
The company’s gross margin hit 51.6% for the period. CEO Christophe Fouquet called it “a good quarter for ASML” in a statement.
Looking ahead, ASML provided upbeat guidance for the fourth quarter. The company expects sales between €9.2 billion and €9.8 billion.
Gross margin for Q4 should reach up to 53%. For the full year, ASML is forecasting 15% growth in total net sales.
AI Demand Spreads Across Customer Base
The chip equipment maker continues to see growing demand driven by AI investments. This momentum is now extending beyond its initial customer base.
Both leading-edge logic and advanced DRAM customers are increasing their spending. Fouquet noted “continued positive momentum around investments in AI” in the company’s statement.
ASML also made its first move into advanced packaging. The company shipped its inaugural TWINSCAN XT:260 i-line scanner during the quarter.
This new product offers four times the productivity of existing tools. It marks the company’s entry into the 3D integration space.
The partnership with French AI firm Mistral is gaining traction. ASML aims to embed AI technology across its entire product lineup to boost throughput and efficiency.
China Sales Expected to Drop in 2026
Despite the positive near-term outlook, ASML struck a cautious tone on its China business. Management warned of a substantial decline in Chinese revenue starting in 2026.
This follows what the company described as exceptionally strong performance in China during 2024 and 2025. However, ASML expects total 2026 sales to match or exceed 2025 levels.
CFO Roger Dassen addressed speculation about customer stockpiling on Wednesday. He ruled it out as a factor in the projected decline.
“The reason I rule out stockpiling is because systems that we ship are actually in a chips factory,” Dassen told reporters. His comment suggests the equipment is being used rather than warehoused.
Goldman Sachs analysts characterized the company’s tone as mixed. Analyst Alexander Duval highlighted the absence of a clear acceleration narrative for 2026, particularly given the expected China revenue drop.
The bank noted the guidance may be deliberately conservative. Duval pointed to improving trends in chip industry spending.
Demand for ASML’s EUV machines remains strong. Interest in AI-related technologies is growing across the customer base.
The ramp-up of the company’s newest High NA systems is moving faster than expected. Goldman Sachs maintains a €935 price target on the stock, roughly 10% above current levels.
ASML will pay an interim dividend of €1.60 per share on November 6, 2025. The company bought back €148 million in shares during Q3 under its ongoing €12 billion repurchase program that began in 2022, bringing total buybacks to €5.9 billion.
