Artificial intelligence is emerging as the most significant long-term growth catalyst for ASML Holding ASML, reinforcing its position as one of the most strategically important companies in the global semiconductor industry. The company dominates the extreme ultraviolet (EUV) lithography market and leads the commercialization of next-generation high-NA EUV systems, technologies that are essential for manufacturing the world’s most advanced chips.
As AI workloads become increasingly compute-intensive, leading chipmakers are accelerating investments in cutting-edge semiconductor fabrication, directly boosting demand for ASML’s lithography systems. The AI-driven expansion is no longer limited to logic chips but extends to high-bandwidth memory, networking processors and advanced packaging, creating a broader and more sustainable demand cycle. Advanced AI processors, including GPUs and memory chips, require the precision of EUV lithography, strengthening ASML’s long-term order pipeline.
ASML is also leveraging AI to enhance its own operations. The company is integrating AI across engineering, product development and customer support to improve productivity and innovation. Its collaboration with Mistral AI to deploy generative AI capabilities across engineering workflows and customer service further strengthens operational efficiency while accelerating problem-solving and design processes.
Supported by billions invested in annual research and development, an unmatched technological moat and leadership in advanced lithography, ASML is well-positioned to capitalize on the AI-driven semiconductor investment cycle. With AI serving as both a powerful demand driver and an internal productivity enabler, the company remains a critical force underpinning the global AI revolution and long-term semiconductor innovation.
What About ASML’s Peers?
KLA Corporation KLAC leads the semiconductor process control industry by developing breakthrough inspection and metrology systems, electron-beam technologies and AI-driven defect classification software. KLAC’s inventions ensure the yield and reliability of complex AI chips, advanced packaging and IC substrates.
Applied Materials, Inc. AMAT recently introduced breakthrough technologies to supercharge AI compute, enhance 2nm Gate-All-Around logic transistors, advance High-Bandwidth Memory and revolutionize advanced chip packaging.
ASML’s Price Performance
Shares of ASML Holdings have gained 67.6% year to date, underperforming the industry.
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ASML’s Valuation
The stock appears undervalued compared with its industry. It is currently trading at a price-to-earnings multiple of 42.84, lower than the industry average of 42.92.
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Estimate Movement for ASML
The Zacks Consensus Estimate for ASML’s second-quarter and third-quarter 2026 EPS witnessed southbound movement in the last 30 days. While estimates for 2026 earnings moved down in the last 30 days, the same for 2027 moved up in the same time frame.
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The consensus estimates for ASML’s 2026 and 2027 revenues and earnings indicate year-over-year increases.
ASML stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).