To The Moon

🧠 ASML Surges on AI Orders

Is a Multi-Year AI Capex Supercycle Now Locked In?

ASML just delivered one of the cleanest “cycle confirmation” quarters the semiconductor industry has seen in years — and the market noticed.

Q4 net sales hit a record €9.7B, orders exploded to €13.2B (nearly 2× consensus), and EUV orders alone reached €7.4B, lifting backlog to €38.8B. Two High-NA EUV systems were already recognized in revenue — a milestone that quietly signals where the next decade of chipmaking is headed.

Shares surged up to +10% after hours 📈 — not on hype, but on visibility.

So the real questions now:

• Is ASML entering a multi-year AI capex supercycle?

• Or is this the point where investors should pause, not chase?

Let’s break it down 👇

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🚀 Why This Quarter Matters More Than the Headline Beat

This wasn’t just a strong quarter.

It was a structural signal.

🔑 1️⃣ Orders > Revenue = Forward Visibility

When orders massively outpace revenue, it tells you:

• Customers are committing capital far in advance

• Capex decisions are no longer “optional”

• The demand isn’t cyclical — it’s strategic

€13.2B in orders vs €9.7B in revenue means future growth is already spoken for.

That’s not a rebound — that’s a pipeline.

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🧠 2️⃣ EUV + High-NA = Monopoly in Motion

ASML remains the sole supplier of:

• EUV lithography

• High-NA EUV (next-gen node enabler)

There is no substitute, no second source, no workaround.

As AI chips:

• Grow larger

• Run hotter

• Demand tighter geometries

EUV intensity doesn’t decline — it increases.

This is why customers aren’t delaying orders despite macro noise.

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🏗️ 3️⃣ AI Capex Is Infrastructure, Not a Cycle

Microsoft, Meta, hyperscalers, and foundries are not “experimenting” with AI.

They are:

• Building long-life infrastructure

• Locking in capacity years ahead

• Competing on compute dominance

Once you fall behind in AI compute, you don’t catch up cheaply.

ASML sits at the chokepoint of that race 🧩

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🌍 The Bull Case: A Rare, Visible Multi-Year Runway 📈

🟢 1️⃣ Backlog = Built-In Growth

€38.8B backlog provides:

• Revenue visibility well into 2026+

• Downside protection if memory weakens

• Confidence to expand production capacity

Very few industrial companies have this clarity.

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🟢 2️⃣ High-NA Is the Next Earnings Lever

High-NA systems:

• Cost significantly more per unit 💰

• Drive higher margins

• Increase service & upgrade revenue

As adoption ramps from pilot → production, ASPs rise and mix improves.

This isn’t priced in fully yet.

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🟢 3️⃣ AI Spend Is Broadening

This isn’t just Nvidia-driven demand.

It’s coming from:

• Logic

• Advanced memory

• Foundry expansions

• Custom silicon programs

ASML benefits regardless of which chip company wins 🏆

That’s the ultimate “picks & shovels” positioning.

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🐻 The Bear Case: Why Chasing Here Isn’t Risk-Free ⚠️

🔴 1️⃣ Valuation Is No Longer Cheap

After the rally:

• ASML trades at a premium to historical averages

• Expectations are now very high

• Any hiccup in delivery timelines or margins will be punished

This is a great company — but price matters.

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🔴 2️⃣ Execution Risk Scales With Complexity

High-NA EUV:

• Is more complex to install

• Requires ecosystem readiness (fabs, yields, tooling)

• Has longer learning curves

Delays wouldn’t kill the story — but they could delay upside.

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🔴 3️⃣ Semis Are Still Cyclical (Just Less So)

AI may be secular, but:

• Memory can still wobble

• Macro shocks can freeze capex temporarily

• Governments & geopolitics remain wildcards

ASML is insulated — not immune.

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🎯 So… Chase the Momentum or Wait?

✅ Chase (selectively) if:

• You’re a long-term investor (5–10 years)

• You want exposure to AI infrastructure, not AI hype

• You’re comfortable paying for quality + visibility

⏳ Wait for pullbacks if:

• You’re adding size, not starting a position

• You want margin of safety after a sharp run

• You expect short-term consolidation

📌 Best strategy:

Core position + opportunistic adds on volatility

ASML rarely gives deep discounts — but it does breathe.

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🧠 Final Take

This quarter didn’t just confirm strength —

it confirmed inevitability.

ASML isn’t riding an AI wave.

It’s enabling the ocean 🌊

• Orders signal multi-year commitment

• EUV & High-NA lock in technological leadership

• AI capex looks structural, not speculative

📈 This is what early-stage supercycles look like — before they become obvious.

Chasing blindly is risky.

Ignoring it entirely is riskier.