ASML raises outlook as AI demand outruns capacity in 2027 and 2028

Third-quarter results beat expectations

ASML, the Dutch maker of chip-printing equipment and Europe's most valuable listed company, reported third-quarter sales of €11.66 billion on Wednesday, 14 October 2026, up by more than half. Net profit almost doubled to €4.96 billion, well above market expectations. Management said much of the strength came from upgrades of machines already installed at customers, a business that grew more strongly than the company had expected. On the back of these figures, ASML announced an interim dividend of €1.88 per share.

Fourth-quarter guidance and the demand gap

For the fourth quarter of 2026, ASML forecast sales of €14.2 billion to €15.2 billion with a gross margin of around 57%. Analysts polled by LSEG had expected €14.19 billion. The company also raised the low end of its 2026 sales forecast, its third consecutive quarterly upgrade. Investment in artificial intelligence data centres is driving the upswing in orders. ASML now says it cannot fully meet customer demand in 2027 or 2028 and is looking at ways to expand capacity further. Customers are already placing orders for 2028, and some want machines for 2029 and even 2030.

Fouquet described the shift in the company's customer talks in a statement:

A lot of our discussions with our customers now are shifting in fact beyond 2027.

Capacity plans under review

In July, ASML said it would raise capacity by 30% in 2027 and again by 30% in 2028. Fouquet now says those two steps will not be enough to meet customer demand. The company is examining an expansion of its 2028 capacity beyond the planned 30%. Orders have been improving from quarter to quarter, and the company expects its order book to keep growing. ASML is the only company in the world able to build chip machines using extreme ultraviolet light, a technology that the most advanced chipmakers depend on.

Chip shares slumped earlier in the week

Earlier in the week of 12 October, chip shares slumped worldwide. The sell-off followed remarks by Hock Tan, chief executive of Broadcom, who warned that expectations for artificial intelligence were too high and that financing its expansion could run into problems. ASML's stronger outlook is expected to reassure investors. The contrast between the early-week sell-off and the upbeat guidance is the central tension for the sector this week.

Profit and volumes compared with earlier years

In the third quarters of previous years, ASML's profit was around €2 billion each time, according to NOS, so this year's €4.96 billion is far higher. The company expects to ship 65 machines to customers this year, 50% more than last year. It is also upgrading existing machines so customers can produce more chips over the same period. Its customers include TSMC, Samsung and Intel.