Key Takeaways
- ASML Holding NV, a Dutch semiconductor equipment company, has reached record highs after Taiwanese chipmaker TSMC’s strong earnings report
- The company’s shares have risen around 7% since TSMC’s earnings were released and have rallied 25% so far in 2026
- Morgan Stanley predicts ASML’s stock could surge 70% ahead as chipmaker spending continues to rise to meet AI demand
- TSMC’s capex guidance exceeded prior expectations, underpinning near-term upside for ASML
- Companies embedded in the global AI race have seen strong performances as demand for the technology has soared
Introduction to ASML’s Success
ASML Holding NV, a Dutch semiconductor equipment company, has been making waves in the tech industry with its recent record highs. Following Taiwanese chipmaker TSMC’s strong earnings report on Thursday, ASML’s shares have risen around 7% and have rallied 25% so far in 2026. This surge in stock price has made ASML the third European company to see its valuation tick above the half-trillion dollar mark, with a market cap of around 450 billion euros ($522 billion). As the world’s only supplier of complex photolithography machines needed to manufacture the most advanced artificial intelligence chips, ASML is poised for continued growth.
Morgan Stanley’s Bullish Predictions
Morgan Stanley has expressed optimism about ASML’s future, stating that the company’s stock could surge 70% ahead as chipmaker spending continues to rise to meet AI demand. In its bull case scenario, the bank predicts that ASML’s stock could rise up to 2,000 euros if tech valuations continue to spike and profits beat expectations. As stated in the Morgan Stanley note, "Higher 2027 foundry and memory capex as well as better than feared China demand drives our conviction for higher FY27 earnings." This prediction is based on the expectation that order intake over the next 2-3 quarters will confirm the strength of the company.
TSMC’s Impact on ASML
TSMC’s strong earnings report has had a significant impact on ASML’s stock price. The Taiwanese chipmaker’s capex guidance "significantly" exceeded prior expectations, according to Bank of America, which underpins near-term upside for ASML. As TSMC is ASML’s largest customer, its strong performance is a positive indicator for ASML’s future growth. The U.S. announcement to limit tariffs on Taiwan to 15%, with chip and technology companies from the country investing at least $250 billion in production capacity in the U.S., has also given TSMC a boost. As JPMorgan noted, "ASML stock has been on a tear due to the potential for strong capex at semi manufacturers starting late ’26."
The Global AI Race
The global AI race has driven strong performances among companies providing memory chips, which are crucial components to advanced semiconductors designed by Nvidia and AMD. Memory prices are expected to rise another 40-50% in Q1 of 2026, according to Counterpoint Research. Companies like Samsung, which is the only DRAM major with available clean room capacity, are likely to increase orders significantly in the quarter. As Nvidia partner Foxconn reported a 22% surge in revenues in the final quarter of 2025, it is clear that the demand for AI technology is soaring. ASML, as a key player in the semiconductor equipment industry, is well-positioned to benefit from this trend.
Upcoming Earnings Report
ASML is due to report its fourth-quarter earnings on January 28. With the company’s stock price at record highs, investors will be closely watching the earnings report to see if ASML can continue its momentum. As the world’s only supplier of complex photolithography machines, ASML is a critical component of the global AI ecosystem. With Morgan Stanley’s bullish predictions and TSMC’s strong earnings report, ASML’s future looks bright. As the company continues to innovate and meet the growing demand for AI technology, its stock price is likely to continue to rise.
https://www.cnbc.com/2026/01/16/asml-record-high-ai-boom-tech-stocks.html