ASML’s Record Backlog Meets a High-NA Chasm: Can Orders Keep the €2,350 Target in Play?

ASML's €38.8B backlog and raised 2026 guidance highlight surging demand, but TSMC's reluctance to adopt costly High-NA EUV before 2029 creates a fundamental split among chipmakers.

The euphoria surrounding ASML’s next-generation lithography systems is running up against a stark reality: not every major chipmaker is willing to pay the price for progress. While the Dutch equipment giant sits on a staggering €38.8 billion order book and Susquehanna has just lifted its price target from €1,475 to €2,350 – implying nearly 46% upside from current levels – the market is grappling with a fundamental split among its most important customers over the adoption of High-NA EUV technology.

At roughly €1,608, ASML’s shares have more than doubled over the past twelve months and are up almost 63% year-to-date. Yet the stock remains about 8% below its 52-week high of €1,748, set in late June. The 50-day moving average of €1,449.83 sits around 11% lower, while the RSI of 53.2 suggests the rally has room to run – provided the order pipeline delivers.

A €40 Billion Ambition Backed by Capacity Plans

ASML has recently raised its 2026 revenue guidance to a range of €36–€40 billion, up from the earlier €34–€39 billion, with a gross margin between 51% and 53%. To meet that demand, the company plans to ship roughly 60 Low-NA EUV systems this year, a 25% increase over 2025. By 2027, capacity is expected to expand to 80 Low-NA machines and at least 10 High-NA units.

That expansion, however, comes with a condition. Management has stated that the 80-unit target for 2027 depends on sufficient customer orders materialising. The difference between capacity and actual bookings will determine whether ASML can sustain its record run. UBS analysts note that High-NA offers cost savings of up to 40% compared with alternative patterning approaches, which could drive adoption from 2028 onwards.

The Bull Case: Memory Giants Fuel the Fire

Optimists point to a surge in memory-chip demand that is forcing Samsung and SK Hynix to accelerate capacity expansions. Both South Korean groups need ASML’s equipment for their next-generation DRAM and NAND production lines, and Intel has already installed early High-NA systems to support its 14A process node. Analysts at BofA and Barclays have recently raised their price targets, with Barclays suggesting that deliveries could exceed 90 Low-NA units in 2027 as ASML compresses lead times and finds efficiencies in assembly.

The bullish narrative also draws on ASML’s unique monopoly: it is the only supplier of EUV lithography systems in the world. That pricing power is reflected in the backlog, which stood at around €38.8 billion at the start of 2026, with lead times of at least one year.

The Bear Case: TSMC Hits the Brakes

The most significant headwind comes from Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chipmaker. TSMC has told ASML it will not use High-NA EUV for volume production before 2029, citing the cost of over €350 million per machine – a price tag that one TSMC executive recently described as “very expensive.” This leaves ASML’s High-NA ramp dependent on a narrow group of early adopters, primarily Intel, Samsung and SK Hynix.

Barclays has warned that even the 2027 capacity target of 80 Low-NA units is not guaranteed, and an overreliance on a handful of clients concentrates delivery risk. If TSMC’s reluctance spreads to other customers, the growth story could stall. Compounding the uncertainty, US lawmakers are pursuing legislation to ban DUV sales to Chinese chip companies, a move that would further restrict ASML’s addressable market. The bill is still going through the parliamentary process, and the Dutch government is part of international export-control alliances that complicate the China business.

The Next Catalyst: July 15

All eyes are now on ASML’s second-quarter earnings report, due on 15 July 2026. Investors will be looking for concrete details on order intake and delivery schedules for 2027 – the data points that will either validate the current valuation or trigger a reassessment. Should Intel, Samsung and SK Hynix confirm their commitment to the 80-unit target, the case for new highs remains intact. But if booking momentum slows, the gap to the recent all-time high may widen rather than close.