This article first appeared on GuruFocus.
ASML Holding (NASDAQ:ASML) sits on one of the most valuable choke points in the AI boom, and demand is not slowing down. The lithography giant raised its 2026 revenue outlook after another strong quarter, while its U.S.-listed shares gained roughly 1.7% Monday morning. Then came another bullish signal from one of its biggest customers. TSMC’s (NYSE:TSM) July revenue exploded 44.7% year over year to NT$467.58 billion. AI chips cannot keep scaling without more leading-edge manufacturing capacity, and those fabs cannot easily scale without ASML’s machines.
The numbers show just how hard ASML is preparing to push. Management now expects 2026 revenue of 43 billion to 45 billion, with the midpoint implying roughly 16% growth from its previous range. Second-quarter revenue hit 9.33 billion and net income reached 2.92 billion. But the real tell is capacity. ASML plans to boost annual EUV production capacity by roughly 30% in both 2027 and 2028. Even better, most of the extra EUV capacity through 2027 was already booked when management reported. ASML is not building machines and hoping customers appear. Customers are already waiting.
ASML Stock Rises 1.7% as AI Demand Signal Strengthens ยท us.finance.gurufocus
That brings investors to the uncomfortable part: price. GuruFocus puts ASML at $1,748.12 against a GF Value estimate of roughly $1,200, meaning the stock trades a hefty 46.15% above GF Value. The business may deserve a premiumASML owns technology the advanced-chip industry simply cannot replace overnightbut 46% is a lot of optimism already baked into the shares. TSMC’s booming revenue, ASML’s packed EUV pipeline and the relentless AI infrastructure buildout keep the growth story roaring. Now execution has to roar with it. Bookings need to stay strong, capacity expansion needs to land on schedule, and export restrictions cannot derail too much Chinese demand. ASML has the moat. It has the customers. It has the AI tailwind. The question at $1,748 is whether investors are already paying for too much of that future today.