ASML hiked its full-year sales forecast for the second time this year and beat quarterly estimates, yet shares closed lower, a reminder that the market has already priced the AI boom to perfection. The Dutch lithography monopoly now expects 2024 revenue of €43-45 billion with gross margins of 54-56%, up from a prior range of €36-40 billion and 51-53%. Second-quarter net sales came in at €9.3 billion against €8.8 billion expected; net profit hit €2.9 billion versus €2.6 billion consensus.
The guidance lift reflects order intake that chief executive Christophe Fouquet called "extremely strong" in the first half, with customers accelerating capacity expansion plans. ASML will target 30% more low-NA EUV capacity and 30% more DUV immersion capacity for 2026, adding to the cleanroom optimization and fast-shipment levers it is already pulling at its Veldhoven facility. The company's sole-supplier status on extreme ultraviolet machines makes it the toll booth for every advanced chip the AI buildout requires.
Shares jumped 7% at the open but pared gains to close 0.49% lower, even after surging 115% year-to-date. Morningstar analyst Javier Correonero calls the stock slightly overvalued at roughly 50 times forward earnings, Covid-era peak multiples, with a lot already priced in. The market's reaction suggests investors are weighing whether the visibility Fouquet cites justifies the multiple or simply confirms what was already baked in.
Export controls loom as the wild card. A bipartisan US bill would cut off DUV sales to Chinese chipmakers, though past restrictions triggered pre-emptive buying booms that temporarily inflated demand. That law still needs to work its way through the legislative process. Meanwhile, Taiwan Semiconductor Manufacturing Co, ASML's largest customer, reported a 68% jump in June sales and is adding two advanced packaging plants in southern Taiwan, signaling the demand pipeline remains full.
The question is whether AI-driven capital spending can sustain these multiples once the current capacity wave crests. UBS expects a stronger second half on fab buildout and leading-edge demand, but the stock's inability to hold gains on a double beat and a raise tells you the bar has moved from "good" to "flawless."