KEY POINTS
- ASML reports on Wednesday 15 July, one day before TSMC, making it the first big test of the AI chip boom.
- It is the only company on earth that makes EUV machines, the equipment needed to produce every advanced AI chip.
- We see it as the earliest warning signal, because chipmakers must order its machines years before a factory can open.
- The catch: ASML has stopped publishing its quarterly order numbers, so investors must now read between the lines.
If you own Nvidia, Micron or any chip stock, Wednesday matters.
ASML (NASDAQ:ASML), a Dutch company most investors have never studied, reports its results before the US market opens, and it may be the single most revealing report of the whole earnings season. Here is why, and what to watch.
Why ASML Is the Best Early Warning System
ASML makes something nobody else can: EUV machines. These are the extraordinarily complex tools used to print the tiny circuits on advanced chips. Every cutting-edge processor Nvidia designs, and every high-end memory chip from Samsung or SK Hynix, is made on ASML equipment.
It has a genuine monopoly. There is no alternative supplier anywhere in the world. Memory has become a big new source of demand, with SK Hynix and Samsung buying EUV machines to make the memory that AI servers need.
That is what makes its results such a powerful signal. A chipmaker cannot build a new factory overnight. It must order ASML’s machines years in advance. So if the AI boom were starting to cool, the first place you would see it is not in chip sales today, but in the orders chipmakers are placing with ASML for tomorrow.
In simple terms: ASML tells you what the industry is planning, not what it just sold.
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What Wednesday Will Show
The signs going in are strong. In its last quarter, ASML’s sales rose 13% to €8.8 billion (about US$10.3 billion), and it raised its full-year forecast to €36-40 billion (roughly US$42-47 billion). Chief executive Christophe Fouquet said bluntly that “supply will not meet the demand for the foreseeable future,” and that memory customers are already sold out for 2026.
There is a wrinkle, though. ASML has stopped publishing its quarterly order numbers, arguing that big orders arrive unevenly and distort the picture. So the clearest signal investors want is no longer handed to them. The market must read management’s commentary instead.
Watch three things: whether ASML raises its full-year forecast again, what it says about demand from memory makers, and its comments on China.
The China Problem
That last one is the real risk, and the damage has already started. China was ASML’s biggest market in 2025, worth 33% of its revenue. Then US export controls tightened, and China’s share of system sales collapsed from 36% at the end of 2025 to just 19% in the first quarter of 2026. ASML now expects China to be around 20% of 2026 sales.
The danger is that it shrinks further. A bipartisan bill in Congress would ban ASML from selling its older DUV machines to China altogether. JPMorgan estimates that could knock up to 10% off ASML’s earnings.
This is why traders are braced for a big move. Options markets are pricing in a share swing of more than 8% after the results, double the usual reaction.
The Investor’s Takeaway
Our take: ASML is a superb business, arguably the best-protected in technology, thanks to a monopoly no rival can challenge soon. If it lifts guidance again, it would strongly suggest the AI buildout still has years to run, and that would lift the whole chip sector.
But mind the price. The shares have jumped around 63% this year, so a lot of optimism is already built in. A quarter that merely meets expectations could disappoint a market hoping for another upgrade, and the China threat is real and unresolved.
Our view: we would not buy immediately before a report that could swing 8% either way. The smarter approach is to let Wednesday’s numbers land, then judge. The key thing to watch is not the profit figure, but whether ASML still sounds confident about demand beyond 2026. That is the answer everyone is really looking for.
