ASML’s CEO Takes the Fight to Washington as $16 Billion in Orders Pile Up

The Dutch lithography giant is riding two very different waves this spring. On one side, a tidal surge of orders from memory-chip heavyweights SK Hynix and Samsung Electronics has propelled the stock to a 12-month high. On the other, ASML’s chief executive is spending his time at a Los Angeles conference defending the company’s China strategy against a fresh legislative assault in Washington.

Christophe Fouquet, speaking at the Milken Institute Global Conference, made no apologies for the company’s approach to the Chinese market. He endorsed the playbook popularised by Nvidia’s Jensen Huang: maintain a technological gap between what you sell and what you keep. In ASML’s case, the machines currently being shipped to China were originally launched in 2015 — a deliberate nine-year lag. Nvidia, by Fouquet’s account, keeps a gap of roughly eight generations.

The CEO flatly dismissed rumours that Chinese engineers had successfully reverse-engineered any ASML technology. He also pointed out that not a single one of the company’s ultra-complex EUV machines has ever been delivered to the People’s Republic. The message was clear: ASML can keep selling without giving away the crown jewels.

The $16 Billion Memory Splurge

The market’s attention, however, is fixed on a different story. Within the span of a single month, both SK Hynix and Samsung Electronics placed orders for EUV machines worth approximately $8 billion each. Samsung went further, adding 50 lithography systems based on older ASML technology to its shopping list. Micron Technology, meanwhile, plans to lift its capital expenditure to $25 billion this year and is widely expected to become another major customer.

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The catalyst is unmistakable. Demand for high-performance memory chips used in artificial intelligence applications is pulling the entire supply chain along with it — and ASML sits at the bottleneck.

Strong Numbers, Higher Targets

The operational engine is firing on all cylinders. First-quarter 2026 net sales hit €8.8 billion, with a gross margin of 53 percent. Net profit came in at €2.8 billion, comfortably ahead of consensus estimates. Management responded by lifting the full-year revenue guidance to a range of €36 billion to €40 billion, up from the previous €34 billion to €39 billion.

Bank of America promptly raised its price target and earnings estimates. Of the analysts covering the stock, 38 recommend buying, only one says sell. The average 12-month price target sits at roughly €1,469.

The stock closed Thursday at €1,296.80, a whisker below its fresh 52-week high. Year-to-date, the shares have gained 31 percent.

The Washington Shadow

Yet the geopolitical headwinds are impossible to ignore. China’s share of ASML’s system sales slumped to 19 percent in the first quarter, down from 36 percent in the prior quarter — a direct consequence of existing US export restrictions. Now a bipartisan bill in the US Congress, known as the MATCH Act, threatens to go further by banning the sale of even older DUV lithography systems to Chinese chipmakers. The legislation has not passed, but it hangs over the stock like a guillotine blade.

Fouquet’s public confidence notwithstanding, the numbers tell a cautionary tale. ASML itself expects second-quarter gross margins of 51 to 52 percent, noticeably below the 53 percent delivered in Q1.

High-NA: Expensive and Delayed

Another pressure point comes from Taiwan. TSMC, ASML’s largest customer, has decided it will not deploy the company’s next-generation High-NA EUV systems until at least 2029, citing cost concerns. Each of these machines carries a price tag north of $350 million. The delay pushes a major revenue driver years into the future.

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Fouquet brushed aside the timing concerns, arguing that the systems are designed for a 10- to 20-year lifecycle, making the exact delivery month irrelevant. Investors may be less patient.

Technical Signals Flash Caution

The stock now trades roughly 8 percent above its 50-day moving average. The relative strength index sits at 69, technically close to overbought territory. The price-to-earnings ratio exceeds historical averages, and the annualised 30-day volatility stands above 50 percent.

The next quarterly results are due in July 2026. By then, the market will have a clearer picture of how many of those blockbuster memory orders have converted into recognised revenue — and whether the upgraded full-year guidance can hold against the gathering political storm.

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