Impact of the MATCH Act on ASML
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy ASML?
Source: NASDAQ.COM
- Legislative Impact: The proposed MATCH Act not only restricts ASML's new sales to China but also bans high-margin servicing of existing equipment, potentially leading to a significant decline in ASML's revenue from this key market and impacting its long-term growth outlook.
- Market Share Compression: In 2025, China accounted for 33% of ASML's total revenue, with expectations to drop to 20% in 2026; however, the passage of the MATCH Act could further compress this figure, affecting the company's overall revenue projections.
- Servicing Revenue Risk: The MATCH Act's prohibition on servicing existing equipment in China poses a substantial risk to ASML's servicing revenue, which has been a critical growth driver, thereby impacting future profitability.
- Long-Term Outlook Intact: Despite facing short-term challenges, ASML's monopoly on EUV lithography technology and the sustained global demand for advanced chips continue to support its long-term investment thesis, with projected revenues reaching between $51.9 billion and $70.7 billion by 2030.
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Analyst Views on ASML
Wall Street analysts forecast ASML stock price to rise
12 Analyst Rating
12 Buy
0 Hold
0 Sell
Strong Buy
Current: 1476.500
Low
1385
Averages
1583
High
1911
Current: 1476.500
Low
1385
Averages
1583
High
1911
About ASML
ASML Holding N.V. is a holding company based in the Netherlands. The Company operates through its subsidiaries in the Netherlands, the United States, Italy, France, Germany, the United Kingdom, Ireland, Belgium, South Korea, Taiwan, Singapore, China, Hong Kong, Japan, Malaysia and Israel. The Company operates through one business segment which is engage in development, production, marketing, sales, upgrading and servicing of advanced semiconductor equipment systems, consisting of lithography, metrology and inspection systems. The Company offers TWINSCAN systems, equipped with lithography system with a mercury lamp as light source (i-line), Krypton Fluoride (KrF) and Argon Fluoride (ArF) light sources for processing wafers for manufacturing environments for which imaging at a small resolution is required. TWINSCAN systems also include immersion lithography systems (TWINSCAN immersion systems).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Enhanced Shareholder Returns: Despite record R&D spending, ASML plans a 17% increase in dividends and a €12 billion stock buyback program from 2026 to 2028, demonstrating a strong commitment to shareholders and healthy cash flow.
- Long-term Investment Value: With a forward P/E ratio of 39.3, ASML's valuation is high, yet its leadership in AI and semiconductor manufacturing, along with sustained high margins, positions it as an ideal choice for long-term investors.
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- Sustained Market Demand: The ongoing demand for AI chips positions ASML uniquely to benefit from data center spending, which is expected to drive its long-term growth and high-margin potential.
- Technological Monopoly Advantage: ASML holds a near-monopoly in high-end semiconductor lithography equipment, enabling production of chips at higher resolutions and transistor densities, ensuring pricing power and backlog.
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See More
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- Optimistic Outlook: The management raised its 2026 revenue guidance to between €36 billion and €40 billion, up from the previous range of €34 billion to €39 billion, reflecting a sustained optimistic outlook on demand for advanced memory and logic chips.
- Capacity Expansion Plans: ASML expects to ship 25% more low-NA EUV chips this year compared to 2025, with a projected 33% increase next year, which will provide strong support for the company's future earnings growth and help its stock price continue to rise in 2026.
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See More
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- Surge in AI Chip Demand: The ongoing demand for AI chips, which exceeds current production capabilities, positions ASML favorably due to its unique role in the value chain, indicating the potential for long-term growth driven by multi-year backlogs.
- Monopoly Advantage in Technology: ASML holds a near-monopoly in high-end semiconductor lithography equipment, and its advanced manufacturing processes are critical for modern chip production, ensuring its pricing power and market share.
- Future Growth Catalysts: The construction of chip fabs in the U.S. will reduce ASML's reliance on customers, enhancing its competitive edge in the market, although its elevated valuation necessitates sustained earnings growth to justify investor expectations.
See More
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See More
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