ASML's Order Acceleration Points to Sustained AI Momentum in 2026

The semiconductor equipment maker is signaling a major inflection in the industry’s growth trajectory. ASML’s latest quarterly results reveal not just solid operational performance, but a dramatic shift in customer behavior that could define the investment landscape for the coming year. With bookings more than doubling year-over-year and management publicly acknowledging a pronounced acceleration in capacity expansion planning across its customer base, the story has shifted from struggling recovery to genuine momentum driven by artificial intelligence infrastructure buildout.

The company reported fourth-quarter revenue of 7.58 billion euros, up 6.6% from the prior year period, with earnings per share reaching 7.34, a 7.3% increase. These headline numbers tell only part of the story. The real signal lies in what’s happening downstream: bookings totaled 13.2 billion euros for the quarter alone, crushing the prior-year quarter, while full-year bookings hit 28 billion euros, representing 48% annual growth. These figures underscore a fundamental shift in how semiconductor manufacturers are approaching their capital spending plans.

Bookings Surge Signals Chip Equipment Demand Inflection

The booking acceleration matters enormously because of the temporal dynamics inherent in ASML’s business model. The company typically requires 12 to 18 months to convert orders into revenue once machines are deployed at customer facilities. This lag means current bookings provide a reliable window into future revenue growth, which management guided to 34 billion to 39 billion euros for 2026—representing roughly 14.7% growth at the midpoint.

CEO Christophe Fouquet framed the shift directly, stating that the company has observed “a notable increase and acceleration of capacity expansion planning across a large majority of our customer base.” This isn’t enthusiasm confined to a handful of accounts; it’s broad-based demand reflecting the industry’s collective decision to invest in chip manufacturing capability to support AI applications and services.

ASML remains the world’s sole manufacturer of extreme ultraviolet (EUV) lithography systems—the extraordinarily complex machines required to produce the most advanced semiconductor nodes. The company ships roughly 100 of these machines quarterly, making it extraordinarily sensitive to shifts in customer demand patterns. The typical semiconductor cycle moves at a different pace than ASML’s own revenue and earnings cycle, which instead tracks capital spending decisions by chip manufacturers.

EUV Expansion Accelerating as AI Chips Drive Capacity Planning

One particularly telling metric illustrates the transformation underway: EUV systems as a percentage of ASML’s total system sales climbed from 38% in 2024 to 48% in 2025. Management expects this percentage to continue rising through 2026. This shift reflects the industry’s prioritization of cutting-edge fabrication capability, directly tied to the explosion in demand for AI-capable processors and the infrastructure required to manufacture them at scale.

The market’s immediate reaction revealed some ambiguity. The stock initially jumped nearly 5% in premarket trading but surrendered those gains once the regular trading session opened, suggesting investors remain cautious about valuation metrics despite the encouraging business momentum. ASML’s share price has effectively doubled over the past six months on improving visibility into the semiconductor capital cycle, but the pullback on earnings day hints that current valuations have largely priced in the recovery narrative.

Valuation Concerns Temper Initial Optimism, But Long-Term Thesis Remains Intact

The investment case hinges on whether the acceleration in bookings proves durable or represents a temporary cyclical peak. Several factors support sustained momentum: the AI infrastructure spending wave is expected to persist and potentially intensify, major chip manufacturers are actively expanding their production footprint, and ASML’s monopoly position ensures it captures a disproportionate share of capital spending flowing to semiconductor equipment.

However, the company did announce plans to cut 1,700 positions to streamline operations and refocus resources on engineering and innovation—a structural move that suggests management believes it must maintain competitive advantages despite the cyclical upswing.

For investors contemplating ASML, the core question is whether the current valuation already reflects the acceleration now underway or whether additional upside exists as bookings convert into revenue throughout 2026. The bookings explosion and management’s explicit acknowledgment of accelerating customer investment in capacity provide genuine confirmation of the AI-driven structural tailwind. Whether that translates into stock appreciation depends substantially on how efficiently the market re-rates the company as this growth materializes into actual revenue over the coming quarters.