ASML says capacity shortfall will limit 2027 and 2028 supply

The Dutch company announced its supply plans mean it cannot fully meet demand for machines in 2027 or 2028. CEO Christophe Fouquet stated that some customers are already placing orders for 2029 and sometimes even 2030. This shift happens as AI-related investments drive forecasts higher than previously expected.

In the third quarter results announced today, net sales were €11.7bn. The company raised its guidance for full year 2026 to between €44bn and €45bn. Investors responded by driving shares up 2.8% to €1,551.60 in Amsterdam.

Production levels are rising alongside demand. Just this quarter, the company sold more than 120 of its sophisticated lithography machines for chip manufacturing. In the same period last year, sales stood at just more than 70 units.

To address the shortage, a second industrial campus is under construction in the Netherlands' Brainport region. The first phase of this expansion is due to finish in 2029. Previously, the company planned to increase supply capacity by 30 percent in 2027 followed by another 30 percent in 2028.

However, a senior executive noted that ASML sold nothing to European customers this past quarter. This comes after an EU special report found the region's Chips Act was not enough to reach its Digital Decade goal. Europe's best earnings quarter in three years was driven by energy rather than AI.

Clientele spans major global companies including Apple and Taiwan Semiconductor Manufacturing Company. China remains about a fifth of this year's revenue while pricing changes are visible partly through 2027. ASML holds the position as the only company that makes equipment key to producing advanced chips.