ASML Holding N.V. earnings recap
Q3 FY2026, reported October 14, 2026 · Beat 6 of last 7 quarters
ASML Holding N.V. reported Q3 FY2026 revenue of $12.97B, a miss of 1.3% against consensus, and EPS of $14.52, a beat of 18.8%.
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ASML is the lithography chokepoint for leading-edge logic and DRAM capacity, and this quarter's message is that supply shortages across advanced nodes keep growing in size and time horizon, with customer demand expected to outpace supply through at least 2028. The company is accelerating its own output — nearly 50% more low-NA EUV systems this year — and planning 2027 capacity up 30% with a review of more than 30% for 2028, while customers place orders for 2028 and express interest in 2029 and 2030. High-NA EUV milestones (Intel's 1 million exposed wafers, Samsung's 2028 and TSMC's 2030 HVM plans, and the 12-inch mask initiative) suggest the next lithography platform is moving from development toward production, extending the buildout's equipment runway.
| Estimate | Actual | vs est | ||
|---|---|---|---|---|
| Revenue | $13.14B | $12.97B | -1.3% | miss |
| EPS | $12.17 | $14.52 | +18.8% | beat |
This company reports in EUR. Figures are shown as supplied by our data provider and may be in a different currency or per-share basis than the company's filing.
Q3 total net sales were a record €11.7B, toward the high end of guidance, with net system sales of €8.4B — €4.1B from EUV (including one High-NA system) and €4.3B from non-EUV — split 54% logic and 46% memory. Installed base management sales of €3.3B exceeded guidance by almost €400M on strong demand for productivity upgrade products in both EUV and DUV. Gross margin was above guidance at 57.5%, net income was €5.0B (including around €500M from an increase in the valuation of the Mistral AI investment) for earnings per share of €12.95, and free cash flow was €11.4B, underpinned by customer down payments tied to order momentum. Management said 2026 low-NA EUV output should be roughly 65 systems, nearly 50% more than the 44 shipped in 2025, while DUV immersion output should match 2025 levels after an initially lower target. ASML shipped its first YieldStar 550B metrology system and said availability across the High-NA EUV fleet is approaching 90%.
ASML guided Q4 total net sales to €14.2B–€15.2B with gross margin of around 57% and installed base management sales of around €3.7B, implying continued sequential acceleration. For the full year 2026, management expects total net sales of €44B–€45B at a gross margin of around 56%, with logic net system sales up around 10% and memory up around 75%, and China still around 20% of total net sales. On capacity, management said 2027 output is planned up 30% for both low-NA EUV and DUV immersion, and it now expects those 2027 and 2028 levels 'will not fully meet the demand' of customers — so it is looking at expanding 2028 capacity even above the previously-investigated further 30% increase for both low-NA EUV and immersion. Negotiated price increases on what management called the most critical products will have some effect in 2027 and their full effect from 2028 onward. Management said customers conclude demand for their products will outpace supply through at least 2028, that ASML is increasingly receiving orders for 2028 with customer interest in placing orders for 2029 and even 2030, and that new low-NA EUV customers — particularly in DRAM — and High-NA interest are broadening the demand base. Gross margin support is expected from volume/fixed-cost coverage, mix and pricing, partly offset by ramp costs and by the sustainability of the very strong upgrade business as a swing factor.
“This extended visibility has led them to conclude that demand for their product will outpace supply through at least 2028.”
on Customer demand visibility
“Conversations have been completed and, you know, have indeed led to pricing increases for what we call the most critical products for our customers.”
on Value-based pricing
“We are increasingly receiving orders for 2028, and customers are also expressing interest in placing orders for 2029 and even 2030.”
on Order momentum
Can you give additional color on the capacity expansion needed beyond the 30% discussed last quarter, and what you think you can do in 2027 relative to the mid-80s discussed last quarter?
Christophe said ASML is working hard to increase capacity in 2026, 2027 and 2028 because customers keep asking for more tools, but that the additional opportunity is easier to enable later — mostly 2028 rather than the shorter term. He declined to give new 2027/2028 numbers, calling it far too early, while saying the company will do everything it can to get extra capacity.
Some ASML suppliers will need to add physical capacity for these huge volume increases, and ASML itself has no additional physical capacity until 2029 — how is the supply chain being managed, do suppliers need substantial payments, and are there impediments?
Christophe said the only real challenge with the supply chain is ensuring suppliers can ramp, and that none question the strength of the demand. He pointed to 50% EUV growth this year as evidence of what the supply chain can do with ASML, said the 30% 2027 and more-than-30% 2028 figures come from validated confidence that the chain can follow, and that ASML continues adding suppliers for less critical parts. On the most critical supplier, Zeiss, he said ASML does not see it as a bottleneck for capacity expansion even beyond the 30% discussed for 2028.
In this unprecedented shortage, would ASML consider changing how it contracts with customers — for example higher prepayments or more firm orders earlier — to make sure customers are committed?
Roger said an order placed with ASML is not a frivolous piece of paper: it carries a down payment 'enough to hurt' and is a deep two-sided commitment that is not easy or cheap to exit. On accepting orders early, he said customers have asked ASML to accept POs for 2029 and 2030, but ASML is holding off until it has a full picture of total signaled demand versus its expected capacity, so that no long-standing customer is left out.