ASML's Revenue Mix is Changing: What are the Latest Growth Drivers?

ASML Holding ASML completed its 2025 results with €32.67 billion, up 15.6% year over year. ASML’s net systems sales contributed 74.9% of the top line, up 12.4% year over year. ASML’s net systems sales saw a decline in contribution from China. China contributed 41% to net systems sales in 2024 and 33% in 2025.

The decline was mainly due to U.S.-led export restrictions combined with demand normalization following high deep ultraviolet (DUV) equipment demand in 2024. However, the gap was filled by South Korea and Taiwan, which contributed 25% and 22% in 2025, up from 21% and 11%, respectively, in the year-ago quarter.

On the technology side, extreme ultraviolet (EUV) technology is expanding its contribution to the top line, replacing DUV. EUV contributed 48% to the net systems sales, up from the contribution of 38% in 2024. The demand for EUV is rising proportionately with the growing usage of AI chips, as foundries have to transition to 3nm / 2nm nodes requiring more EUV layers per chip.

The rise in demand for memory products like high bandwidth memory and DDR is also causing traction in EUV technology. As the world moves toward sub-2nm manufacturing, the demand for High-NA EUV systems will also rise, giving ASML a multi-year runway for harnessing growth, as evident in the €38.8 billion backlog in the year ended 2025.

How Competitors Fare Against ASML

ASML competes with companies like Lam Research LRCX and Applied Materials AMAT in the wafer fabrication equipment (WFE) space.

Lam Research is an established WFE manufacturer that is established in the memory space. Lam Research’s memory segment, accounting for both Dynamic Random Access Memory and Non-Volatile Memory divisions, is gaining traction on the back of AI.

Applied Materials supplies equipment used in chip fabrication, including deposition and etching tools that are essential for both advanced and mature nodes. As chips become more complex with AI and high-performance workloads, Applied Materials’ tools aid in designing and making efficient and smaller node chips.

ASML’s Price Performance, Valuation and Estimates

Shares of ASML have surged 95.7% in the past 12 months compared with the Zacks Computer and Technology sector’s growth of 31.5%.

ASML 12-Month Performance Chart

From a valuation standpoint, ASML trades at a forward price-to-sales ratio of 12.26X, higher than the sector’s average of 6.2X.

ASML Forward 12-Month (P/S) Valuation Chart

The Zacks Consensus Estimate for ASML’s 2026 and 2027 earnings implies year-over-year growth of 20.5% and 23.5%, respectively. The consensus estimate for fiscal 2026 and 2027 has been revised upward in the past 30 days.

ASML currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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