Goldman: Lithography machine demand remains robust, expects ASML (ASML.US) to rise more than 40%.

Goldman published a research report, reiterating its "buy" rating on ASML (ASML.US) and giving a 12-month target price of 1010 euros, which indicates a potential upside of over 40% from the current price.

The Goldman analyst led by Alexander Duval stated that ASML's 2025 revenue guidance of 30-35 billion euros is largely risk-free from the perspective of customer delays, given the company's strong orders, and has the potential to approach the upper limit of the guidance in an optimistic scenario (including progress in Intel (INTC.US) and Samsung (SSNLF.US) foundry, TSMC (TSM.US) and SK Hynertek accelerating capacity construction, and its IBM (IBM.US) business improving).

Moreover, the bank's analysts believe that the improvement of ASML's 2nm capacity will drive demand for its tools in the next few years (including the DUV market outside China), and pointed out that the increase in EUV orders at the 2nm node will continue for several years, as the node will not reach its maximum construction capacity in the next few years. However, any potential revenue growth will depend on the continued strong performance of advanced logic markets and stable base markets.

The report also emphasized that ASML reiterated that China would contribute about 20% of the Group's sales in 2025, and the company continues to see strong demand in the region. Goldman said that ASML believes the potential restrictions would have limited impact on its service business.

Overall, Goldman believes that ASML's outlook remains positive despite risks such as EUV delivery delays, capital expenditure cycles, and unfavorable market share changes.