ASML’s €8.8 Billion Quarter Fuels a €40 Billion Revenue Target as a New CTO Takes Charge

ASML beats Q1 expectations with €8.8B revenue and raised 2026 outlook, but stock slips 3% on cautious Q2 guidance and ex-dividend trading.

ASML delivered a first-quarter performance that beat analyst expectations, yet the stock has slipped roughly 3% over the past week. The disconnect between operational strength and market sentiment reflects a cautious near-term outlook that has tempered enthusiasm around the Dutch lithography giant.

Revenue hit €8.8 billion in the three months through March, with net income landing at €2.8 billion. The gross margin climbed to 53%, hitting the top end of management’s target range. Those figures provided the foundation for an upgraded full-year forecast: ASML now expects 2026 revenue between €36 billion and €40 billion, up from its prior guidance.

The bullish outlook rests on a robust order book fueled by the global buildout of AI data centers. Management has indicated that production capacity for certain advanced chip nodes is effectively sold out for the remainder of the year. A newly announced €1.3 billion semiconductor partnership with Mistral AI underscores the momentum in high-performance computing.

Second-Quarter Caution Tempers the Rally

For the current quarter, ASML is dialing back expectations. Revenue is projected at no more than €9.0 billion, and the gross margin is expected to slip from the first-quarter level. That guidance, combined with the stock trading ex-dividend yesterday, has weighed on the share price. The stock now changes hands at roughly €1,211, though it remains up 106% year to date.

The final dividend of €2.70 per share was paid yesterday, bringing the total 2025 payout to €7.50 per share — a 17% increase from the prior year. That figure comprises three interim dividends of €1.60 each and the final distribution. The cash will reach shareholders on May 5.

Capital Returns and a New Leadership Era

ASML bought back approximately €1.1 billion of its own shares during the first quarter, part of a broader €12 billion buyback program that runs through 2028. The combination of dividend growth and aggressive repurchases reflects the company’s strong cash generation.

The annual general meeting on April 22 brought several leadership changes. Marco Pieters has been appointed chief technology officer for a four-year term, taking the helm of ASML’s critical lithography R&D efforts. CFO Roger Dassen was reappointed for another four years, while COO Frédéric Schneider-Maunoury secured a two-year extension. On the supervisory board, Benjamin Loh — former CEO of ASM International — joins as Alexander Everke steps down.

China Expansion Continues Despite Geopolitical Headwinds

ASML is pressing ahead with its China strategy even as export controls remain a persistent risk. The company plans to hire around 300 new employees in the country this year, primarily in customer service, technical support, and installation roles. The installed base business — service and field upgrades — contributed €2.5 billion in first-quarter revenue, slightly above internal forecasts.

Analyst sentiment remains broadly positive, with a consensus price target of roughly €1,463 and bullish estimates reaching as high as €1,890. The primary overhang is geopolitical: potential further restrictions on exports to China continue to shadow the stock. For now, though, the AI-driven demand for advanced lithography systems keeps ASML in a position of strength, with supply still struggling to keep pace with orders.