ASML Holding delivered a second-quarter 2026 earnings report that beat its own guidance on virtually every key metric, then raised its full-year 2026 revenue outlook by roughly 16% at the midpoint, sending the world's monopoly supplier of extreme ultraviolet lithography machines higher in both regular and after-hours trading on Wednesday. The results reinforced the view that AI-driven semiconductor demand is not only intact but is accelerating in ways that are straining the company's ability to deliver equipment fast enough.
The company reported Q2 net sales of €9.33 billion, above the guidance range of €8.4 billion to €9.0 billion it had provided three months earlier and above the analyst consensus of approximately €8.80 billion compiled by LSEG. Net income was €2.92 billion against an expectation of €2.62 billion, while the gross margin of 54% also landed at the top of guidance. The standout outperformance came from ASML's installed base management business, which reached €2.8 billion in the quarter, exceeding expectations by €300 million as customers increasingly elected software-led upgrades that can be delivered with limited machine downtime.
The guidance raise was the headline for markets. ASML now expects full-year 2026 net revenue of €43 billion to €45 billion, up from the €36 billion to €40 billion range it had signaled after the first quarter, which was itself a raise from the original €34 billion to €39 billion forecast provided at the start of the year. The company simultaneously raised its expected gross margin for the full year to 54% to 56%. CEO Christophe Fouquet said demand from both logic and memory customers was "continuous and very strong" and that the company would expand its production capacity by approximately 30% over the next two years to meet the volume of orders it is receiving.
A specific strategic milestone added weight to the earnings narrative. Intel's foundry division confirmed during the quarter that it has begun high-volume manufacturing of select Intel Core Ultra Series 3 processors using ASML's High NA EUV lithography on the Intel 18A process node, marking the first commercial deployment of the technology and validating ASML's most advanced — and most expensive — tool family. High NA machines, which carry price tags near $350 million each, represent the next frontier of chipmaking precision and their successful deployment by a major customer removes one of the key execution risks that had concerned investors earlier in the year.
Memory chip demand remained a central driver, echoing the Q1 pattern when memory surged to 51% of new-tool net sales, a level that reflected the urgency among DRAM and HBM makers to expand capacity for AI workloads. China's contribution to revenue retreated further as U.S. export controls continued to limit ASML's ability to sell advanced tools to Chinese customers, though management noted China could still account for roughly 20% of full-year revenue, primarily from older-generation immersion lithography equipment.
US-listed ASML shares rose 2.87% to $1,775.64 in regular trading and added another 3.51% after hours, reaching $1,838 — near the top of the stock's 52-week range. Peers including Applied Materials, Lam Research, and KLA Corporation were broadly higher in sympathy as the results confirmed AI capital expenditure from chipmakers remains on an accelerating trajectory through the back half of 2026. TSMC is scheduled to report its own second-quarter results on July 16, and investors said ASML's bullish commentary sets a high bar of confirmation for AI-driven demand that the Taiwanese foundry giant is expected to reinforce.