ASML Can Supply More EUV Tools Than Expected, JP Morgan Raises Price Target
65d ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
asmlsemiconductor-manufacturing
Fazen Markets Editorial Desk
Collective editorial team · methodology
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Financial markets intelligence provider Fazen Markets reported on June 3, 2026, that JP Morgan Chase increased its price target for ASML Holding NV (ASML.AS). The bank raised its target to 1,175 euros per share, up from its previous estimate of 1,050 euros. This adjustment follows signals from the Dutch chipmaking equipment leader that it can supply significantly more extreme ultraviolet (EUV) lithography systems than previously indicated to the market. The revised guidance is tied to improvements in manufacturing throughput and supply chain resiliency.
Semiconductor manufacturing capacity is a primary geopolitical and economic battleground. Leading-edge logic chips, which power everything from smartphones to AI data centers, are exclusively produced using ASML’s EUV systems. The company has long been the sole supplier of this foundational technology.
For years, supply constraints on these multi-hundred-million-dollar tools have been a critical bottleneck. Foundries like Taiwan Semiconductor (TSM) and Samsung have planned multi-year, multi-billion-dollar fab expansions contingent on EUV delivery schedules. Any upward revision in ASML’s output potential accelerates the global roadmap for advanced chip production.
The catalyst for this shift is a multi-quarter effort by ASML to de-bottleneck its own complex manufacturing process. The company has implemented new production techniques and secured more reliable components from its sprawling supplier network. These operational gains translate directly into a higher rate of tool shipments.
JP Morgan’s new 1,175 euro price target implies a 12% upside from the bank’s prior target and represents a significant premium to consensus. ASML’s stock closed at 1,018 euros on June 2, 2026, giving the company a market capitalization of approximately 398 billion euros.
The bank projects ASML will ship 72 EUV systems in 2026, up from a prior forecast of 68 units. For 2027, the shipment estimate is now 85 systems, increased from 78. Each high-NA EUV tool, the next-generation model, carries a price tag exceeding 350 million euros.
| Metric | Prior Estimate | New JP Morgan Estimate |
|---|---|---|
| 2026 EUV Shipments | 68 units | 72 units |
| 2027 EUV Shipments | 78 units | 85 units |
| Price Target | 1,050 euros | 1,175 euros |
ASML’s estimated shipment growth of nearly 6% for 2026 and 9% for 2027 outpaces the projected growth rate for the wider Wafer Fab Equipment (WFE) market, which analysts forecast will grow 4-6% annually over the same period.
Increased EUV tool availability is a direct positive for foundry giants Taiwan Semiconductor (TSM), Intel (INTC), and Samsung. These companies can accelerate their capacity build-outs, potentially bringing advanced nodes like 2nm and 1.4nm into volume production sooner. This could compress their technology roadmaps and improve competitive positioning.
The secondary effect flows to chip designers like Nvidia (NVDA), Advanced Micro Devices (AMD), and Apple (AAPL). Faster foundry capacity expansion reduces supply risks for their most advanced processors, particularly critical for AI accelerator chips facing enormous demand. Equipment peers like Applied Materials (AMAT) and Lam Research (LRCX) may see correlative demand increases for their complementary process tools.
A key counter-argument is that macroeconomic demand must materialize to absorb this potential new capacity. A slowdown in end-markets like PCs, smartphones, or enterprise data center spending could lead to a temporary supply glut, delaying capital expenditure plans and pushing out order timelines for ASML. Positioning data indicates institutional investors are net long the semiconductor equipment sector, with recent options flow showing increased call buying on ASML and TSM.
ASML’s next quarterly earnings report, scheduled for July 19, 2026, will provide formal updated guidance and commentary on order backlog health. Investors will scrutinize the mix between legacy low-NA EUV and the newer, more expensive high-NA systems.
Key levels for ASML stock include the 1,050 euro area, which was the prior resistance from JP Morgan’s old target, and the 1,200 euro psychological barrier. A sustained break above 1,050 on heavy volume would confirm the bullish thesis from the increased shipment estimates.
The broader sector catalyst is Taiwan Semiconductor’s capital expenditure update during its earnings call in mid-July. Any upward revision to TSMC’s 2026-2027 capex budget, particularly for advanced packaging and leading-edge logic, would validate the increased tool demand projected by JP Morgan’s analysis. Monitoring the book-to-bill ratio for the overall semiconductor equipment industry provides a crucial leading indicator.
Extreme ultraviolet lithography uses light with a wavelength of 13.5 nanometers to etch incredibly fine circuit patterns onto silicon wafers. This wavelength is over 14 times shorter than the previous deep ultraviolet technology. Generating this light involves firing high-powered lasers at microscopic tin droplets to create a plasma, a process that requires immense precision and complex optics. This allows chipmakers to create transistors that are just a few nanometers wide, enabling the continued advancement of Moore’s Law.
ASML’s business model carries high operational use and cyclical risk. A downturn in semiconductor demand would cause foundry customers like TSMC and Intel to delay or cancel equipment orders, impacting ASML’s revenue with a lag of one to two quarters. The company’s large installed base provides some recurring revenue from service contracts, but over 70% of its sales are from new system shipments. A prolonged slowdown could also pressure the very high valuation multiples the stock commands based on long-term growth expectations.
Numerical aperture (NA) is a measure of a lens system’s ability to gather light and resolve fine features. ASML’s current low-NA EUV systems have an NA of 0.33 and are used for chips down to the 3nm node. The new high-NA EUV tools have an NA of 0.55, providing higher resolution for patterning the even smaller features required for chips at the 2nm node and beyond. High-NA tools are significantly more complex and expensive, costing over 350 million euros each, but are essential for the next phase of transistor scaling.
ASML’s increased EUV tool capacity accelerates the global race for advanced semiconductor manufacturing supremacy.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
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