Overview
Bernstein analyst David Dai raised his price target on ASML Inc. to $1,911 from $1,642 while keeping an Outperform rating, citing the company's substantial order intake and revenue outlook. Dai also flagged that ASML shares closed down about 2% despite the strong results, characterizing the pullback as a market-driven buying opportunity.
Quarterly bookings and backlog
ASML reported exceptionally large fourth-quarter 2025 net bookings of €13.2 billion, a result that came in almost double what the Street had been expecting. Bookings were split with memory-related orders representing 56% and advanced logic representing 44%. The company’s backlog rose by €7 billion sequentially to reach €38.8 billion.
2026 guidance and margin outlook
For 2026 ASML issued revenue guidance in a band of €34-39 billion, with the upper bound well above the consensus figure of €35 billion. Management linked the range to customers' clean room availability, noting that growth is expected to be driven by EUV technology while DUV volumes are likely to remain comparatively flat. The company reaffirmed longer-term targets through 2030 of €44-60 billion in revenue and gross margins of 56-60%. For 2026 specifically, management guided gross margins to a range of 51-53%, a level the analyst described as "a tad soft" and attributed to product mix effects.
Analyst reactions and peer moves
ASML’s strong bookings and forward guidance prompted several brokerages to raise their outlooks. Among those moves were:
- RBC Capital raising its price target to $1,625, pointing to robust demand for AI applications in DRAM and advanced logic.
- Deutsche Bank increasing its target to €1,500 and maintaining a Buy rating.
- Wolfe Research adjusting its target to €1,450, citing the company’s revenue guidance for 2026.
- Barclays upgrading ASML to Overweight, driven by anticipated lithography needs for AI-driven data centers.
- Jefferies lifting its target to €1,260, noting the size of order intake for future shipments.
Implications
The combination of outsized bookings, a sizable backlog, and guidance that pushes the high end well above consensus has altered several firms’ views of ASML’s near-term revenue trajectory. Management’s comments tying 2026 outcomes to clean room availability and to the split between EUV and DUV technologies highlight capacity and supply-side constraints as key determinants of timing for shipments and revenue recognition.
Key takeaways
- Bernstein increased its ASML price target to $1,911 and kept an Outperform rating after ASML’s record bookings.
- ASML posted Q4 net bookings of €13.2 billion and a backlog of €38.8 billion, with memory making up 56% of orders.
- 2026 revenue guidance of €34-39 billion has an upside above consensus, but margins for 2026 were described as slightly soft due to product mix.
Risks and uncertainties
- Execution risk tied to customers' clean room availability - revenue in 2026 depends on customers being able to accept equipment.
- Product mix pressure on margins - management described 2026 gross-margin guidance of 51-53% as a bit soft, signaling margin sensitivity to what ships.
- Market reaction volatility - despite strong fundamentals, ASML stock fell about 2% on the reporting day, illustrating dislocations between results and near-term share-price moves.