ASML Holding N.V. (ASML): A Bull Case Theory

We came across a bullish thesis on ASML Holding N.V.  on Archive Invest’s Substack by Felix. In this article, we will summarize the bulls’ thesis on ASML. ASML Holding N.V. 's share was trading at $770.00 as of August 27^th. ASML’s trailing and forward P/E were 27.56 and 27.47 respectively according to Yahoo Finance.

ASML stands at the center of the global semiconductor supply chain, holding a monopoly in extreme ultraviolet (EUV) lithography, the critical technology enabling cutting-edge chips. Its machines, priced between $180 million and $350 million, contain over 100,000 parts and take months to assemble, yet no competitor has been able to replicate them at scale. Nikon and Canon exited the market, leaving ASML as the sole provider of EUV technology. The company’s next growth engine, High-NA EUV, will power 2nm chips and beyond, crucial for AI and advanced computing.

While this transition carries risks—production bottlenecks, supplier dependencies, and engineering complexity—these same challenges reinforce ASML’s competitive moat. Customers such as TSMC, Samsung, and Intel account for the bulk of revenues, and ASML’s backlog exceeds €39 billion, underscoring its position as a chokepoint in global innovation. Although export restrictions limit China sales, management views these as strengthening ASML’s structural advantage, as no rival can fill the gap. Financially, ASML reported €27.6 billion in 2023 revenue with 51% gross margins, €7.8 billion in net income, and €6–7 billion in free cash flow, providing flexibility to fund High-NA development.

Its business model is anchored by recurring service revenue, which helps offset cyclical swings in machine sales. Geopolitical tensions, customer concentration, and cyclicality remain risks, but management positions each as a barrier to competition. With High-NA rollout, AI-driven fab expansions, and recurring services underpinning long-term growth, ASML is not simply cyclical—it is a structural enabler of the future, offering investors rare monopolistic leverage.

Previously we covered a bullish thesis on ASML Holding N.V. (ASML) by FluentInQuality in May 2025, which highlighted the company’s monopoly in EUV lithography, strong financials, and strategic importance as a bottleneck in the semiconductor supply chain. The company’s stock price has appreciated approximately by 3.41% since our coverage. This is because the thesis played out as expected. Archive Invest’s Felix shares a similar view but emphasizes High-NA EUV as the next growth catalyst.

ASML Holding N.V.  is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 80 hedge fund portfolios held ASML at the end of the first quarter which was 86 in the previous quarter. While we acknowledge the risk and potential of ASML as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ASML and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.