ASML’s High-NA EUV Goes Live at Intel, but a €45 Billion Outlook Fails to Lift the Stock

Intel starts mass production with ASML's High-NA EUV; ASML Q2 revenue surges 21% to €9.3B, raises guidance, but shares fall 2.64% on valuation and sector caution.

Intel has put ASML’s next-generation lithography into mass production for the first time, marking a technical milestone that should have been a clear tailwind for the Dutch equipment maker. That it wasn’t enough to keep the shares rising on Friday tells the more complicated story behind the company’s latest blockbuster quarter.

Intel Foundry began high-volume manufacturing of select Intel Core Ultra Series 3 processors — part of the Panther Lake family — on July 15, using the 18A process node with ASML’s High-NA EUV systems. The technology delivers higher resolution and better process control than earlier EUV generations, and the production data will be watched closely by other chipmakers weighing the upgrade. ASML stated that each High-NA tool costs more than €350 million.

Yet, by the end of the week, ASML’s stock had slipped 2.64% to €1,526.60, leaving it more than 12% below the 52-week high of €1,748.00 reached in late June. The retreat followed a pattern familiar to ASML watchers: strong numbers met with a muted or negative market response, partly on valuation concerns and partly on a broader sense of caution in the semiconductor sector.

Revenue surge and a second guidance raise

ASML generated €9.3 billion in revenue during the second quarter of 2026, a 21% jump year-on-year. Net profit came in at €2.9 billion, while earnings per share of €7.58 handily beat the consensus estimate of €6.80. The gross margin improved to 54.0% from the prior quarter’s 53.7%. System sales of €6.6 billion were split 51% logic and 49% memory, with the remaining €2.8 billion coming from service and installed-base management.

Management promptly lifted the full-year outlook for the second time in 2026. ASML now expects revenue of €43 billion to €45 billion and a gross margin between 54% and 56% — well above the previous forecast of €36–40 billion and a 51–53% margin. For the third quarter alone, the company projects sales of €11 billion to €12 billion and a margin of 55–57%. Chief executive Christophe Fouquet cited an “exceptionally strong order book” driven by sustained AI-related investment, with memory-chip sales forecast to jump more than 75% this year.

Capacity push meets pricing pushback

To keep pace with demand, ASML is ramping up its production of Low-NA EUV and DUV immersion tools. Capacity is set to rise 30% in 2027 relative to 2026, with another potential 30% increase under study for 2028. The company plans to build roughly 65 EUV systems this year, 84–85 in 2027, and 110 in 2028. The order book is effectively full through the end of 2027.

At the same time, ASML is testing its pricing power. Chief financial officer Roger Dassen acknowledged a “better pricing position” but noted that adjustments take time given long lead times. The company has signaled roughly 10% price increases for Low-NA EUV tools. Some Chinese customers have already accepted similar hikes on older DUV systems. TSMC, however, is pushing back, preferring to extend the life of existing Low-NA machines rather than move to more expensive High-NA equipment — a stance that contrasts with Intel’s early adoption.

China remains a geopolitical wild card

While Chinese clients accounted for just 14% of second-quarter revenue, ASML expects that share to rise to around 20% for the full year. South Korea was the largest single market in the period at 43%. The main risk lies in Washington, where the MATCH Act — which could ban exports of DUV systems to China — is under discussion. ASML has stressed that no EUV machines are shipped to China and that every system is fully traceable, after unsubstantiated claims that one had reached the country.

A €900 million staff bonus and management cuts

Partly in recognition of the strong performance, ASML is granting each of its approximately 45,000 employees a one-time award of €20,000 in shares, valued in total at about €900 million. The stock will not fully vest until early 2030, which the company also sees as a retention tool. The bonus comes alongside a restructuring that will eliminate roughly 1,700 management positions. Separately, ASML has approved a €1.1 billion share buyback and a dividend of €1.88 per share, payable on August 5.

Despite the flurry of positive announcements, the stock has given up 6% over the past month. The year-to-date gain still stands at more than 66%, but the immediate market response suggests that even a High-NA production debut and a record revenue forecast aren’t enough to push the shares past the current air pocket of elevated valuations and sector-wide hesitation.