Could Investing $10,000 in ASML Make You a Millionaire?

Company Overview - ASML Holding is a leading semiconductor technology company based in the Netherlands, dominating the lithography market and controlling the extreme ultraviolet (EUV) lithography industry, essential for producing high-performance computer chips [4][5] - The company generated $33 billion in revenue in 2024, with a net income of $8.8 billion, indicating strong performance despite a slight decline in net income [5] Market Position - ASML's primary customer is Taiwan Semiconductor, the largest manufacturer of high-performance silicon, highlighting ASML's critical role in the semiconductor supply chain [4] - The company holds tens of thousands of patents, reinforcing its competitive advantage in the lithography market [4] Financial Performance - ASML's revenue growth has been inconsistent, with a 69% increase in 2021, a slight contraction in 2022, a nearly 41% growth in 2023, and a projected 31% increase for 2025, but only a 5% improvement expected for 2026 [8][10] - The average annualized revenue growth rate since 2015 has been about 18%, which, while impressive, may not be sufficient for significant long-term investment returns [10] Investment Considerations - A $10,000 investment in ASML is unlikely to yield millionaire-making returns, primarily due to the cyclical nature of its business and the high cost of its EUV lithography machines, priced around $400 million each [5][7] - The company sold 380 new lithography units in 2024, indicating a typical year for sales, which contributes to revenue volatility [7] Future Outlook - There are concerns regarding China's ambitions to develop its own EUV lithography machines by 2028, which could impact ASML's market position and patent protections [11] - Despite its solid performance, the current stock price may be vulnerable to pullbacks, suggesting that potential investors might consider waiting for a more favorable entry point [15]