Doge

The buzz surrounding ASML’s “storage boom” and the start of a “super cycle” stems from their Q4 2025 earnings report and the robust guidance issued for 2026.

In short, ASML is transitioning from the “transition years” of 2024–2025 into a “breakout year” in 2026. Here is the core breakdown:

1. Storage Chips: The New Growth Engine

While ASML’s primary customers have historically been logic chipmakers (like TSMC and Intel), the tide has shifted:

• HBM (High Bandwidth Memory) Fever: The demand for AI servers has created an insatiable need for HBM. To manufacture high-performance HBM, memory giants like SK Hynix, Samsung, and Micron must aggressively adopt EUV (Extreme Ultraviolet) lithography.
• Record-Breaking Orders: In the report released on January 28, 2026, ASML’s Q4 net bookings reached a staggering €13.2 billion, far exceeding market expectations of €6.3 billion. A massive portion of this comes from memory manufacturers “locking in” capacity for 2026.

2. Logical Support for the 2026 “Super Cycle”

ASML has explicitly raised its 2026 outlook, setting annual sales guidance between €34 billion and €39 billion.

• Node Transitions: 2026 marks the critical point for logic chips moving into the 2nm era and memory chips reaching higher stacking density.
• High-NA EUV Commercialization: The most advanced High-NA (High Numerical Aperture) machines will begin contributing significant revenue in 2026 (priced at over €350 million per unit).
• Supply Warnings: CEO Christophe Fouquet noted that due to the frenzy for HBM and DDR5, lithography supply could become “very tight” in 2026 and beyond.

3. Data Comparison: Why the Market is Excited

The table below illustrates ASML’s “V-shaped” recovery:

Metric	2024/2025 (Transition)	2026 (Projected Super Cycle)
Annual Revenue	~€28B – €32B	€34B – €39B
Storage Share	Fluctuating around 20%	Significant increase (Expected)
New Bookings	Occasional declines	€13.2B in Q4 (All-time high)
Gross Margin	~51%	Targeting 54% – 56%

4. Potential Headwinds (A Reality Check)

Despite the “booming orders,” ASML still faces challenges:

• China Market Dilution: Due to tightening export controls, ASML’s revenue share from China is expected to drop from over 40% to roughly 20% by 2026. It must rely on AI demand from the US, Japan, Korea, and Europe to fill this gap.
• Organizational Lean: Interestingly, despite the growth, ASML announced plans to cut roughly 1,700 jobs (4% of its workforce) to streamline management and improve engineering efficiency ahead of the massive delivery wave.

Summary

ASML’s “storage explosion” proves that the AI wave has fully trickled down from software (LLMs) to the deepest layer of hardware (lithography). 2026 is shaping up to be not just a super cycle for memory, but the year ASML solidifies its role as the ultimate gatekeeper of the AI era.