ASML Q4 2025 and Full Year 2025 Earnings Call - AI-driven EUV surge fuels record revenue, orders and backlog

Moderator/Host, ASML: Hello, and welcome to ASML’s Q4 2025 and full year 2025 results video. Roger, if I can start with you, and ask you to give us a summary of both Q4 2025 and the full year’s results.

Roger, CFO, ASML: So Q4, net revenue came in at EUR 9.7 billion. That included the recognition of revenue for two High-NA systems. For the full year, revenue came in at EUR 32.7 billion, which was a 16% increase compared to 2024. Installed base business came in for the quarter at EUR 2.1 billion. If you take the full year, EUR 8.2 billion, quite strong. Quite strong, you know, first on the, on the basis of the service revenue for EUV. Obviously, with the expansion of the installed base for EUV, you see the service revenue increasing there. But also there was quite some appetite for, for upgrade business, so that led to, you know, quite a strong revenue for, for the installed base business.

Gross margin for the quarter, 52.2%. If you take it for the full year, that was 52.8%. Net income, again for the quarter, EUR 2.8 billion, for the full year, EUR 9.6 billion. In terms of net bookings, net bookings came in at EUR 13.2 billion. Included in there, EUR 7.4 billion for EUV. If you look at the backlog that we had at the end of last year, at the end of 2025, EUR 38.8 billion total backlog, of which EUR 25.5 billion for EUV.

Moderator/Host, ASML: Yeah. And then can you give us some color on what you saw in terms of the business in Q4 specifically?

Roger, CFO, ASML: Clearly, it was a strong quarter, right? A strong quarter. It was a record quarter in terms of revenue. It was a record quarter in terms of order intake. It was a record quarter in terms of free cash flow generation. So from that vantage point, clearly a very strong quarter. If you listen to our customers, both what they say publicly, but also what they told us, you know, it’s pretty clear that customers over the past couple of months have actually become more positive in their assessment of the medium-term market perspectives as they see it. I think it’s primarily on the basis of the more robust view that they have when it comes to to demand for AI, which, you know, seems to be more sustainable from their vantage point.

That recognition has led, you know, some of our customers to really invest in capacity and gear up their plans for medium-term capacity expansion. So that’s been clearly the case, and that perspective has obviously also led to a strong order intake for us.

Moderator/Host, ASML: Yeah.

Roger, CFO, ASML: Finally, I would say, important for Q4 is also that we were actually able to demonstrate our ability to gear up our output, which, again, is going to be important also in light of the expectations that we have for 2026.

Moderator/Host, ASML: Then moving to 2026, you know, how are you guiding both Q1 and the full year?

Roger, CFO, ASML: So Q1, we’re looking at an expectation—we expect net revenue to be somewhere between EUR 8.2 billion-EUR 8.9 billion. That’s the expectation for the quarter in terms of revenue. We expect a gross margin between 51%-53%. When it comes to the installed base revenue, we expect around EUR 2.4 billion in Q1. For the total year, we’re looking at total net revenue expected between EUR 34 billion-EUR 39 billion, with a gross margin between 51%-53%.

Moderator/Host, ASML: Christophe, in terms of the market outlook that supports Roger’s commentary there, can you give us a little bit of color on how you’re seeing things?

Christophe, CTO, ASML: Well, I think that, Roger already mentioned very clearly that, the market outlook has notably improved in the last few months. And this is especially true when it comes to the build-up of the capacity for AI application, being data server or other infrastructure. Now, we start to see that this, build-up is also translating into need for capacity at our advanced customers. So this is true for logic, this is true for DRAM. And this start to translate also into orders for our most advanced technology, especially EUV. So in the last few months, we have seen our DRAM customer, our logic customer, starting to accelerate their planning capacity and having this discussion with us.

If I look at logic first, so there, I think we see our customers starting to be more comfortable about the sustainability of the long-term AI demand, and this means that they are more willing to accelerate their capacity planning. They are transitioning also from 4-nm technology to 3-nm technology, which is going to be more demanding in term of advanced technology. And finally, of course, the ramp of 2-nm is going on, and I will say is accelerating in order to fulfill the future need of mobile and HPC application. When I look at, DRAM, there also the demand is very strong for HBM, of course, but also for DDR, and this most probably will lead to a very tight supply, at least in 2026, and most probably beyond that.

So we see our customer ramping 1b, 1c node, which are going to be critical for that demand. And on those nodes, we see them increasing basically the amount of, EUV layers. So we have talked about that in the past. I think we see that happening very strongly right now. So altogether, we see a very positive dynamic, I think a strong belief that the AI demand is real, and a preparation for that with, on the short term, a major addition of capacity. This will start in 2026 and will last beyond that.

Moderator/Host, ASML: ... Turning back to you, Roger, how do you see that then translating into ASML’s business?

Roger, CFO, ASML: So if we start with the EUV business, I think, you know, against the backdrop of the demand and the developments that Christophe was describing, we expect the EUV business to increase significantly. So EUV revenue to significantly go up in comparison to 2025. When it comes to the non-EUV system business, in total, we expect that to be kind of flattish in comparison to 2025, but with, you know, different moving parts in there. If you look at advanced logic, if you look at memory, we actually expect the demand also on the non-EUV business to go up there.

On the China business, we expect the China business for us to come in at approximately the percentage that China also has in our backlog, which is around 20% of our backlog, and therefore, 20% of our revenue is what we expect the China business to come in at. And then I would say on the very clearly also in the non-EUV business, it’s pretty clear that the metrology and inspection business is quite strong. There is a lot of demand for process control, so therefore, we expect that business to go up as well. So those are the different moving parts, but all in all, we expect the non-EUV business to be sort of flattish, the non-EUV system business.

And then the installed base business, I already told you that, we expect the installed base business in 2025 was quite strong. And we actually expect the same dynamics to also go into 2026. We actually expect that business to go up as well, so growth in installed base. On the back of, again, the growth of the installed base business for EUV, and also in the current climate, a significant appetite, we think, for upgrades and for upgrade business, because frankly, that’s the easiest and fastest way for customers to get additional output capacity.

Moderator/Host, ASML: If, Christophe, if I can ask you to give us, you know, an update on how you’re seeing the technology roadmap development, for ASML?

Christophe, CTO, ASML: Well, first, I’d like to say that the appetite for technology from our customer for those advanced node is very, very high, and that’s true for almost all the product in ASML. If I start with Low-NA, 2025 has been a critical but also a good year to ramp our NXE 3800. This tool is now extremely important for our customer. They’re going to rely on it for the next advanced DRAM logic nodes. And we have been able to mature the product, reach the final throughput of 220 wafers per hour, but even demonstrate at some customer that we could go on this tool up to 230 wafers per hour.

Roger said it, upgrades, when, you know, you need capacity, upgrades become very, very important, so this would be good for the 3,800. But we’re also providing on EUV more upgrades for the installed base so that we help our customer on a very short term with capacity. We also expect Low-NA EUV to continue to see more utilization moving forward. We talked a lot about litho intensity. When we look at, for example, the transition from 6F² to 4F² on DRAM, we also expect both immersion and Low-NA to be used even more. So there also we expect good dynamic on litho intensity. Looking at High-NA, customers continue to make good progress on the qualification. I’ve talked about the three phases in the past. A lot of customers are finalizing their R&D phases with the 5,000.

Intel has reported that they have accepted their first 5200, which means basically they have the first tool that will be used in high volume manufacturing, and other customer are going to also get the tool in their hands very, very quickly. The qualification of the tool is going well. Imaging, performance, overlay performance, everything is looking good for our customer right now. Inspection, metrology, Roger touched on that. Almost 30% growth this year, which is significant. It means that both the need for those product is high, but also the product we’re offering are basically meeting our customer need, both on optical, overlay metrology, but also E-beam inspection. On E-beam inspection, multi-beam is becoming more and more critical.

2025 was also a good year for this product, allowing it to mature the technology, demonstrate initial value with our customer, and we expect also that product, I would say, to have more traction in 2026. So overall, huge appetite for technology, lot of project in ASML.

Moderator/Host, ASML: Yeah.

Christophe, CTO, ASML: Some of the key product should become, I would say, production worthy in the coming months.

Moderator/Host, ASML: Back to you, Roger, would you be able to give us an update on dividend and buybacks, what we’re doing on that front?

Roger, CFO, ASML: Yeah. So this quarter, we’ll pay an interim dividend of EUR 1.60 per ordinary share. We’re going to actually propose to the AGM to have a final payment as it pertains to last year, of EUR 2.70 per ordinary share. If you combine that with the interim dividends that would have been made at that point in time, then the total dividend, as it relates to 2025, would be at EUR 7.50 per ordinary share, which would actually be a 17% increase over the dividend over 2024. In terms of a share buyback, the previous program ran until December. We didn’t complete that, so we bought back shares for an amount of EUR 7.6 billion. You know, the maximum amount was EUR 12 billion.

We’re announcing. Actually, we announced today, a new program, a new program for, again, a three-year period, so it ends December 2028, and for an amount up to EUR 12 billion.

Moderator/Host, ASML: Christophe, to finish, if you could give us a reminder on how you’re seeing the, you know, maybe the longer-term demand and what that means for ASML.

Christophe, CTO, ASML: Well, I think one of the key points we made at our Capital Markets Day in November 2024 was that AI application will require more advanced technology in DRAM and logic, and will drive basically some of our most advanced product. And I think that this is being confirmed as we speak. The last few months have pointed basically exactly to that dynamic. We also see that the progress we continue to make on our cost of technology with EUV is driving for more litho intensity, and that’s, again, something that has been confirmed in the last few months. So if we look in, to the long term, in line to what we said in November 2024, for 2030, we expect a revenue between EUR 44 billion and EUR 60 billion and a gross margin between 56% and 60%.

Moderator/Host, ASML: Very clear. Thank you both, very much.

Roger, CFO, ASML: Thank you.

Christophe, CTO, ASML: You’re welcome.