ASML Shares Surge to Unprecedented Valuation on Major Client’s Spending Plans

A significant capital expenditure forecast from its primary customer has propelled ASML Holding NV to a historic peak in both share price and market capitalization. The surge shifts investor focus to the durability of the current semiconductor equipment sector recovery.

Shares in the Dutch semiconductor equipment giant ASML soared as much as 7.6% during early trading in Amsterdam, establishing a new all-time high of €1,167. The stock was last up approximately 5%, lifting the company's market value to around €443 billion (approximately $515 billion). This solidifies its status as Europe's most valuable listed company.

The catalyst for this movement was an updated investment plan from Taiwan Semiconductor Manufacturing Company (TSMC), ASML's largest client. TSMC indicated it could allocate up to $56 billion in capital expenditures for 2026—a figure exceeding analyst expectations. This substantial guidance signals the chipmaker's confidence in sustained high demand, primarily fueled by applications related to artificial intelligence (AI).

This optimistic capex outlook follows TSMC's own strong fourth-quarter 2025 results, released the previous day, which showed a 35% profit jump to a record high, surpassing estimates. The combination of robust earnings and elevated spending plans has alleviated some investor concerns about a potential AI bubble, generating positive momentum across the semiconductor equipment sector.

While other European chip-related stocks benefited from the improved sentiment, ASML led the sector's gains. Since the start of the year, the stock has advanced roughly 23%, having first breached the €1,000 level in early January.

Market Analysts Revise Targets Upward

This rally coincides with a wave of bullish analyst commentary. On January 13, Rothschild Redburn raised its price target to €1,250, anticipating that fourth-quarter 2025 order intake would surpass market consensus by 13%. The firm projects orders of €7.047 billion, compared to the consensus estimate of €6.249 billion.

Bernstein recently upgraded ASML to "Outperform," naming it a top pick in the European semiconductor space for 2026 with a €1,300 price target. Their analysts foresee additional momentum from an impending DRAM super-cycle.

Other notable analyst actions include:
* Aletheia Capital: Upgraded from "Sell" to "Buy" and doubled its price target to $1,500.
* Morgan Stanley: Reiterated an "Overweight" rating with a €1,000 target, classifying ASML as a "Top Pick."
* Jefferies: Maintained a "Hold" rating with a €1,020 target.

Should investors sell immediately? Or is it worth buying ASML?

Attention is particularly focused on order bookings. Rothschild Redburn noted that the Q4 2025 report will be the last time ASML discloses orders on a quarterly basis. Analysts believe semiconductor industry capacity utilization is now sufficiently high to drive a significant rebound in demand for manufacturing equipment in the first half of 2026.

Robust AI Demand Offsets Chinese Market Challenges

The share price strength persists despite ongoing difficult conditions in China, where export restrictions have significantly impacted sales of Deep-Ultraviolet (DUV) lithography systems. However, burgeoning demand for the far more expensive Extreme-Ultraviolet (EUV) systems used for leading-edge logic and memory chips is more than compensating for this weakness.

TSMC's announced $56 billion investment underscores the need for cutting-edge lithography. ASML holds a monopoly as the sole supplier of the highly complex EUV machines required to manufacture advanced chips for products like Apple's smartphones and Nvidia's AI accelerators. Increased investment by foundries in this technology directly benefits ASML through system sales and service revenue.

Furthermore, ASML's installed base management business showed strength in 2025. Revenue from upgrading existing systems and the expanding adoption of EUV technology among customers provided additional support.

Upcoming Financial Report and Technology Timeline

ASML is scheduled to release its fourth-quarter and full-year 2025 results on Wednesday, January 28, 2026. CEO Christophe Fouquet and CFO Roger Dassen will hold a press conference at 11:00 CET, followed by an investor call at 15:00 CET.

For the current quarter, the company previously guided for revenue between €9.2 billion and €9.8 billion, representing a sequential increase of 26.3%. Analysts expect ASML to provide an overall positive outlook for 2026, highlighting continued growth in the EUV business even as its China operations normalize.

Another potential catalyst may arrive in April 2026. According to Rothschild Redburn, industry observers anticipate an update on the introduction of High-NA technology at the TSMC Technology Symposium. The timeline for its adoption could potentially be moved forward from 2030 to 2028—a scenario that would further bolster medium-term demand for ASML's most advanced systems.