ASML shares rally on solid fourth-quarter 2025 results
TCW Funds highlights ASML as a key contributor to its Concentrated Large Cap Growth Fund, citing improved sentiment from TSMC guidance and capacity constraints at major clients.
Shares of Dutch semiconductor equipment maker ASML Holding N.V. rose following the release of its fourth-quarter 2025 financial results, which exceeded market expectations. The company reported revenue of €9.7 billion, representing a 29 per cent increase quarter-on-quarter and a 5 per cent rise year-on-year. This performance slightly surpassed consensus estimates of €9.6 billion, driven by strength in services and foundry upgrades that offset slower memory shipments.
Total bookings reached €13 billion, significantly outpacing the consensus estimate of €7.5 billion. The surge was primarily driven by €7.4 billion in orders for leading-edge Extreme Ultraviolet (EUV) lithography systems, underscoring sustained demand for critical chip production technology. ASML provided a wide revenue guidance range for calendar year 2026 of plus 4 per cent to plus 19 per cent, citing potential timing variations in deliveries between 2026 and 2027.
TCW Funds highlighted ASML as a notable contributor to its Concentrated Large Cap Growth Fund in its first-quarter 2026 investor letter. The investment management firm noted that ASML shares rallied after the company reported solid fourth-quarter results, with the stock closing at $1,459.44 per share on May 19, 2026. The fund attributed improved investor sentiment to strong capital expenditure guidance from TSMC, increasing DRAM pricing, and acknowledged capacity constraints at ASML’s largest customers.
The fund’s letter stated that demand remains robust for ASML as the sole provider of leading-edge lithography solutions. While the fund remains positive on the shares, it also noted that ASML is not among the 40 most popular stocks held by hedge funds heading into 2026. Database records indicate that 101 hedge fund portfolios held ASML at the end of the fourth quarter, an increase from 82 in the previous quarter.
ASML’s market capitalization stands at $562.49 billion, with shares gaining 97.98 per cent over the past 52 weeks. The company’s strong performance comes amid broader equity market volatility in the first quarter, driven by geopolitical tensions and concerns regarding the private credit sector. Despite these headwinds, the fund’s top holdings in information technology and industrials, including ASML, helped offset losses in the broader portfolio.
