ASML's Outlook Strengthened by Surging Memory Chip Demand

Bernstein analysts raise ASML's price target to $1,971, citing surging EUV lithography demand from memory chip makers. ASML boosts dividend and reports record EUV orders.

Market strategists at the US investment bank Bernstein have issued a notably bullish assessment of Dutch semiconductor equipment giant ASML. Their revised price target, set significantly above the prevailing market consensus, has drawn considerable attention. The analysts' confidence stems not from the broader artificial intelligence trend, but from a specific segment: the production of memory chips.

Robust Financials and Shareholder Returns

ASML's operational strength is evident in its market performance. The stock closed at €1,131.20 last Friday, marking a year-to-date gain of over 14 percent. Shareholders are also set to benefit from an enhanced capital return policy. The company has raised its quarterly dividend from $1.88 to $3.1771 per share, translating to an annual yield of approximately one percent. The record date for the upcoming payment is April 27.

This positive momentum follows a strong financial foundation laid in the previous year. Revenue from extreme ultraviolet (EUV) lithography systems surged 39 percent in 2025 to $13.47 billion. In the final quarter, these highly complex machines accounted for more than half of the record order intake, with $8.60 billion in bookings.

EUV Lithography: A Key Growth Driver

Bernstein's upgraded price target of $1,971 is primarily justified by accelerating demand for EUV technology within the DRAM market. The analysts project that annual shipments of these systems to memory chip manufacturers will increase sharply, from 18 units to 44 units by the year 2028.

This optimistic forecast arrives despite a complex operating environment. While some institutional investors, such as Cox Capital, reduced their holdings by nearly 30 percent in the fourth quarter, ASML maintains a substantial backlog of $45.06 billion. This record order book provides a considerable buffer against market volatility and geopolitical risks. A significant portion of revenue, 29.1 percent last year, was derived from business in China, a region of ongoing trade discussions.

Management remains committed to its long-term ambitions amidst global trade tensions, targeting annual revenue between €44 billion and €60 billion by 2030. Bernstein's current analysis reinforces this confidence. The firm's new target of $1,971 positions it well above the broader market consensus, which currently stands at just $1,469.