Semiconductor stocks advanced Wednesday, supported by solid quarterly results from ASML Holding NV (NASDAQ:ASML) and an upbeat near-term outlook from Texas Instruments Inc. (NASDAQ:TXN), adding to broader optimism across the technology sector.
Texas Instruments' Outlook Offsets Modest Q4 Miss
Texas Instruments reported fourth-quarter results that narrowly missed expectations but reassured investors with guidance that pointed to stabilizing demand. The company posted revenue of $4.42 billion and earnings of $1.27 per share, slightly below analyst estimates of $4.44 billion and $1.30 per share, respectively. Revenue still increased 10% year over year.
For the first quarter, Texas Instruments forecast revenue between $4.32 billion and $4.68 billion and earnings of $1.22 to $1.48 per share, compared with consensus estimates of $4.42 billion in revenue and $1.26 per share in earnings. The outlook helped offset concerns around the fourth-quarter miss.
The company designs, manufactures, and sells analog and embedded processing chips, with exposure to industrial and automotive markets and customers such as Apple Inc. (NASDAQ:AAPL), Ford Motor Co. (NYSE:F), and Nvidia Corp. (NASDAQ:NVDA).
ASML Revenue Beat, Buyback Plan Lift Sector
ASML reported fourth-quarter earnings of $8.61 per share, missing consensus estimates of $9.01, but revenue of $11.40 billion exceeded expectations of $11.11 billion and rose more than 15% from a year earlier.
Reinforcing visibility, fourth-quarter net bookings surged to 13.2 billion euros, including 7.4 billion euros in EUV orders, lifting the backlog to 38.8 billion euros and underscoring sustained customer investment in advanced chipmaking tools.
The company guided fiscal 2026 sales to $39.6 billion–$45.4 billion, broadly around the $41.0 billion consensus estimate, while forecasting first quarter 2026 sales of 8.2 billion euros–8.9 billion euros with a healthy gross margin of 51%–53%.
The company also announced a 12 billion euros share buyback program running through 2028.
ASML's customers include Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM), Samsung Electronics Co., Ltd. (OTC:SSNLF), and Intel Corp (NASDAQ:INTC).
AI Developments Add Momentum
Broader chip sentiment was further supported by AI-related headlines. Reuters reported that China approved an initial batch of Nvidia's H200 artificial intelligence chips for import, a notable development amid ongoing regulatory constraints. Separately, the Wall Street Journal said SoftBank Group (OTC:SFTBY) is in talks to invest up to $30 billion more in OpenAI, potentially valuing the company at up to $100 billion.
Market Reaction
In premarket trading, shares of Nvidia, Taiwan Semiconductor, Intel, Broadcom Inc. (NASDAQ:AVGO), Advanced Micro Devices, Inc. (NASDAQ:AMD), ON Semiconductor Corp. (NASDAQ:ON), Marvell Technology, Inc. (NASDAQ:MRVL), and Arm Holdings Plc (NASDAQ:ARM) opened higher.
ASML Holding shares jumped 6.22% to $1,545.02 in Wednesday's premarket session, pushing the stock to a fresh 52-week high, according to Benzinga Pro data. The broader semiconductor space also traded higher, with Nvidia up 1.64% at $191.61, Taiwan Semiconductor rising 2.51% to $346.83, and Intel gaining 6.51% to $46.79.
Broadcom advanced 1.65% to $338.29, while Advanced Micro Devices climbed 2.26% to $257.72. ON Semiconductor surged 5.03% to $65.78, Marvell Technology added 1.84% to $84.46, and ARM Holdings edged up 1.39% to $116.48.
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