Investment Rating - The investment rating for ASML Holding NV is Equal-weight [4][64]. Core Insights - The Q2 order book for ASML Holding NV was ahead of expectations at €5.5 billion, compared to a consensus of €4.5 billion, with €2.3 billion attributed to EUV [2][6]. - The company has adjusted its full-year 2025 guidance to approximately 15% growth relative to 2024, aligning with a previous midpoint of €32.5 billion [2][6]. - ASML forecasts a 30% growth in the EUV business and a 20% growth in IBM sales, while DUV is expected to remain stable compared to FY24 [2][6]. - The company anticipates that revenue from China will exceed 25% in FY25, consistent with the backlog [2][6]. - Commentary for FY26 indicates preparation for growth, but confirmation is pending due to macroeconomic and geopolitical uncertainties [2][6]. Summary by Sections Financial Performance - The strong order intake of €5.5 billion includes €2.3 billion from EUV, implying around 10 tools sold [6]. - Margins exceeded expectations due to improved IBM sales, although a slowdown in upgrades is anticipated for H2, leading to weaker gross margins [6]. - The guidance for 2025 has been tightened to a mid-point growth of approximately 15% year-over-year compared to 2024 [6]. Market Position - ASML's market capitalization is currently €280.763 billion, with a net debt of €(2.267) billion as of December 2025 [4]. - The price target set for ASML is €660.00, based on a mid-cycle 2-year forward P/E multiple of approximately 25x [4][9]. Industry Outlook - The industry view for European Semiconductors is In-Line, indicating expected performance in line with the broader market benchmark over the next 12-18 months [4][35].

Core Viewpoint - ASML reported strong Q2 2025 results with revenue and gross margin exceeding market expectations, but concerns remain regarding future orders and guidance adjustments [1][7][9]. Financial Performance - Revenue for Q2 2025 was €7.7 billion, a 23.2% year-over-year increase, surpassing market expectations of €7.5 billion [1]. - Gross margin reached 53.7%, exceeding the company's guidance of 50-52%, driven by an increase in service revenue and lower-than-expected tariff impacts [1]. - Net profit for the quarter was €2.3 billion, a 45% year-over-year increase, resulting in a net profit margin of 30% [1][6]. Business Segments - Lithography system revenue was €5.6 billion, up 17.5% year-over-year, while service revenue was €2.1 billion, up 41.4% [1]. - EUV and ArFi systems accounted for nearly 91% of lithography system revenue, with EUV revenue around €2.5 billion and ArFi revenue approximately €2.3 billion [2][3]. Regional Performance - Taiwan was the largest revenue contributor, accounting for 35% of total revenue, approximately €2.7 billion, followed by mainland China at 27%, contributing around €2.1 billion [4]. Order Metrics - Net order intake rose to €5.54 billion, a 41% quarter-over-quarter increase, indicating a recovery in customer sentiment [4][7]. - The company’s order performance exceeded market expectations, which were set between €4.5 billion and €4.8 billion [7]. Future Guidance - For Q3 2025, ASML expects revenue between €7.4 billion and €7.9 billion, below market expectations of €8.2 billion [5][9]. - The full-year revenue guidance was adjusted to approximately €32.5 billion, reflecting a year-over-year growth of around 15%, indicating potential revenue decline in Q4 [9][10]. Market Concerns - Despite positive quarterly results, market concerns persist regarding tariff uncertainties, budget constraints from major clients like Samsung and Intel, and potential risks in the Chinese market [10][11]. - The overall sentiment suggests that while ASML remains a leader in the EUV market, short-term challenges could impact stock performance [10].

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was EUR 7.7 billion, which was at the high end of guidance and included revenue recognition for one High NA tool [1][2] - Gross margin for the quarter was 53.7%, above guidance, driven by installed base revenue and one-off cost benefits [1][3] - Order intake for the quarter was EUR 5.5 billion, including EUR 2.3 billion for EUV [4] - Net income for the quarter was EUR 2.3 billion [4] - Guidance for Q3 2025 expects revenue between CHF 7.4 billion and CHF 7.9 billion, with a gross margin between 50% and 52% [5] Business Line Data and Key Metrics Changes - Installed base business is expected to see approximately a 20% increase, driven by strong upgrade revenue and service business improvements [11][12] - EUV business is projected to grow by approximately 30% due to increased capacity demands from customers [10] - Deep UV and application business is expected to remain stable compared to last year [12] Market Data and Key Metrics Changes - AI is identified as the main growth driver for both logic and memory sectors [6] - Revenue from China is expected to exceed 25%, aligning with the company's backlog [6] - The overall semiconductor market remains strong, with long-term revenue forecasts for ASML between EUR 44 billion and EUR 60 billion by 2030 [30][31] Company Strategy and Development Direction - The company is focusing on advancing EUV technology and optimizing costs to meet customer needs [22][30] - There is a strategic emphasis on converting multi-patterning layers to single exposure to enhance productivity [23][30] - The company is navigating uncertainties related to macroeconomic factors and tariffs while preparing for growth in advanced logic and memory [7][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledges increasing uncertainty due to macroeconomic and geopolitical factors, including tariffs [7][21] - The fundamentals for AI customers remain strong, indicating potential for growth despite short-term uncertainties [6][29] - The company expects a revenue increase of approximately 15% for 2025 compared to the previous year, with a gross margin of around 52% for the full year [12][14] Other Important Information - The company has conducted share buybacks worth EUR 1.4 billion and paid a total dividend of EUR 6.4 for the fiscal year 2024 [28] - The first interim dividend for Q3 is expected to be EUR 1.6, payable by August 6 [28] Q&A Session Summary Question: Can you provide a summary of Q2 2025 results? - Revenue was EUR 7.7 billion, gross margin was 53.7%, and order intake was EUR 5.5 billion [1][4] Question: What is the guidance for Q3? - Expected revenue is between CHF 7.4 billion and CHF 7.9 billion, with a gross margin of 50% to 52% [5] Question: How are market dynamics currently? - AI is driving growth in logic and memory, with strong customer investments [6] Question: What are the long-term market expectations? - The semiconductor market remains strong, with significant opportunities driven by AI [29][30]

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was EUR 7.7 billion, which was at the high end of guidance and included revenue recognition for one High NA tool [1][2] - Gross margin came in at 53.7%, above guidance, driven by installed base revenue and one-off cost benefits [1][3] - Order intake for the quarter was EUR 5.5 billion, including EUR 2.3 billion for EUV [4] - Net income for the quarter was EUR 2.3 billion [4] - Guidance for Q3 2025 expects revenue between CHF 7.4 billion and CHF 7.9 billion, with a gross margin between 50% and 52% [5] Business Line Data and Key Metrics Changes - Installed base business is expected to see a 20% increase, driven by strong upgrade revenue in the first half and sustained service revenue in the second half [11][12] - EUV business is projected to grow approximately 30% due to increased capacity demands from customers [10][12] - Deep UV and application business is expected to remain stable compared to last year [12] Market Data and Key Metrics Changes - Artificial intelligence is identified as the main growth driver for both logic and memory sectors [6] - Revenue from China is expected to exceed 25%, aligning with the company's backlog [6] - The semiconductor market remains strong, with long-term opportunities driven by advanced logic and memory needs [30][31] Company Strategy and Development Direction - The company is focusing on enhancing its EUV technology and expanding its capacity to meet customer demands [9][22] - There is an emphasis on mitigating tariff impacts and navigating macroeconomic uncertainties [20][21] - Long-term revenue forecast for 2030 is projected between EUR 44 billion and EUR 60 billion, with a gross margin between 56% and 60% [32] Management's Comments on Operating Environment and Future Outlook - Management acknowledges increasing uncertainty due to macroeconomic and geopolitical factors, including tariffs [7][30] - The fundamentals for AI customers remain strong, indicating potential growth despite short-term uncertainties [7][30] - The company is preparing for growth in 2026, with a focus on advanced nodes and EUV technology [9][30] Other Important Information - The company executed a share buyback worth EUR 1.4 billion and paid a final dividend of EUR 1.84 for the last fiscal year [29] - An interim dividend of EUR 1.6 is expected to be paid in Q3 2025 [29] Q&A Session Summary Question: Can you provide guidance on Q3? - Guidance for Q3 expects revenue between CHF 7.4 billion and CHF 7.9 billion, with a gross margin between 50% and 52% [5] Question: What are the short-term market dynamics? - AI is the main growth driver for logic and memory, with strong customer investments in advanced nodes [6] Question: How does the company view the impact of tariffs? - The company is assessing both direct and indirect effects of tariffs and is working to mitigate their impact [20][21] Question: What is the long-term outlook for the semiconductor market? - The semiconductor market remains strong, with significant opportunities driven by AI and advanced technology needs [30][31]

Group 1 - The article discusses ASML's market position and previous rating of Hold due to concerns over optimistic assumptions regarding DUV shipments, particularly to China [1] - The author emphasizes a focus on investing in companies within oligopolistic sectors that have high barriers to entry, indicating a preference for established firms over smaller companies [1] - The investment approach highlighted is growth at a reasonable price, with a mid- to long-term investment horizon [1] Group 2 - The author has a background in mechanical engineering and experience in the semiconductor sector, which informs their investment strategies [1] - The article aims to provide small investors with valuable investment ideas, particularly in semiconductors, robotics, and energy [1] - The author expresses a commitment to sharing insights and encourages engagement from readers through comments or direct messages [1]

Financial Data and Key Metrics Changes - Total net sales for Q1 2025 were €7.7 billion, including €2 billion from the installed base business, which was within guidance [1] - Gross margin was reported at 54%, slightly better than guidance due to a higher average selling price (ASP) for EUV tools and customer-specific performance rewards [2] - Net income for the quarter was €2.4 billion, with order intake at €3.9 billion, including €1.2 billion for EUV [2] Business Line Data and Key Metrics Changes - The logic segment is expected to see strong growth, particularly in advanced logic, with customers ramping up to two-nanometer technology [6] - Memory is anticipated to remain stable at last year's levels, supported by customer activity [7] - The installed base is growing, with a stronger mix of EUV versus Deep UV tools contributing to growth in 2025 [7] Market Data and Key Metrics Changes - The overall revenue range for 2025 is projected between €30 billion and €35 billion, driven by strong AI demand [4][8] - Tariff dynamics are creating uncertainty in the market, potentially impacting GDP and overall market demand [8][16] Company Strategy and Development Direction - The company is focused on advancing technology, particularly in EUV and High NA systems, to meet customer needs and optimize their product roadmaps [9][12] - There is an emphasis on transitioning from multi-patterning to single-exposed EUV, which is expected to enhance litho intensity and reduce process complexity [11][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledges strong AI demand as a key driver for the market, with expectations for growth in 2025 and 2026 [24][25] - There is caution regarding the impact of tariffs on long-term growth, with ongoing monitoring of the situation [16][25] Other Important Information - The company executed a share buyback of €2.7 billion in Q1 and proposed a total dividend of €6.4 per ordinary share for 2024 [22] - Guidance for Q2 revenue is expected to be between €7.2 billion and €7.7 billion, with a gross margin forecast of 50-53% [17][19] Q&A Session Summary Question: How does the company view the impact of tariffs on 2025? - Management highlighted the dynamic nature of tariffs and their potential direct and indirect implications on the ecosystem and overall market demand, emphasizing the need for careful monitoring [14][16] Question: What is the guidance for Q2? - Revenue is expected between €7.2 billion and €7.7 billion, with a gross margin of 50-53%, reflecting uncertainties related to tariffs [17][19] Question: What are the long-term market expectations beyond 2025? - The company anticipates continued strength in AI demand and a shift towards more advanced technology, with a focus on lithography advancements [24][25]

ASML Conference Call Summary - May 31, 2023 Industry Overview - The semiconductor industry is experiencing a mixed demand landscape, with a noted weakness in the memory market while logic segments, particularly automotive and industrial, remain strong [4][5] - ASML anticipates a 25% growth in top-line revenue for the year, driven by a 40% increase in EUV sales and a 30% increase in non-EUV sales [4][5] Key Insights on EUV and DUV - EUV bookings have decreased to $3.8 billion from a peak of $8 billion, attributed to the high average selling prices (ASP) of tools [7][8] - ASML has a backlog of $39 billion, which is approximately double the expected shipments for the year, indicating strong future demand despite current booking fluctuations [8][9] - The supply chain is expected to improve, which will help reduce lead times and potentially increase bookings in the upcoming quarters [10][11] Demand Dynamics - There is strong demand for mature logic nodes, driven by applications in distributed computing and electric vehicles, which are expected to sustain growth for years [15][16] - AI is seen as a long-term growth driver for leading-edge logic tools, although customers are currently in a cautious phase regarding capital spending [20][21] Supply-Demand Imbalances - The company reported a 20% undersupply in DUV systems, down from 30-50% in previous years, indicating an improvement in capacity and demand alignment [25][26] - Approximately 20% of ASML's backlog is attributed to China, with real demand noted for various semiconductor applications [28][30] Regulatory Impact - Recent U.S. export restrictions have had a limited indirect impact on ASML's backlog, estimated at around 5% [32][33] - The company remains optimistic about its ability to navigate these restrictions, particularly for mature immersion tools [36] Pricing and Margins - ASML is successfully negotiating higher ASPs to offset inflationary pressures, with expectations for continued improvement in gross margins [37][38] - The company has transitioned to an output-based service model for EUV tools, which is expected to enhance revenue predictability and margins [66][68] Future Outlook - ASML is preparing for the introduction of high-NA EUV tools, with initial shipments expected late this year and more significant production ramping up in 2025 [44][46] - The company anticipates that high-NA tools will complement rather than cannibalize low-NA tools, as they will be used for more critical layers in semiconductor manufacturing [50][51] Conclusion - ASML is positioned for growth in a dynamic semiconductor market, with strong demand across various segments and a robust backlog. The company is actively managing supply chain challenges and regulatory impacts while focusing on long-term trends such as AI and electric vehicles to drive future growth.