ASML, the Dutch semiconductor equipment giant, surged 7% after reporting record-breaking fourth-quarter orders and delivering optimistic guidance for 2026, driven by strong demand from the AI boom. The company announced bookings of 13.2 billion euros ($15.8 billion) for the quarter—far exceeding the 6.32 billion euros expected by analysts, according to Visible Alpha, as cited by Reuters. This marks the highest quarterly order volume in ASML’s history, according to finance chief Roger Dassen. In addition to the robust order book, ASML unveiled a 12-billion-euro share buyback program to be completed by December 31, 2028, signaling confidence in its long-term prospects. The company also raised its 2026 sales outlook, projecting total net sales between 34 billion and 39 billion euros, with the midpoint of 36.5 billion euros surpassing the LSEG consensus estimate of 35.1 billion. This represents a potential revenue increase of 4% to 19% compared to 2025, a significant improvement from earlier uncertainty around 2026 growth. For the current quarter, ASML expects net sales between 8.2 billion and 8.9 billion euros. The company reiterated that 2026 sales will not fall below 2025 levels, reflecting stronger momentum than previously anticipated. Despite the positive financials, ASML announced plans to reduce its workforce by approximately 1,700 positions, primarily in the Netherlands with some impact in the United States. The company cited a need to improve agility and streamline operations, noting that its current way of working had become less efficient in some areas. ASML’s performance is closely tied to the global surge in demand for advanced semiconductors, especially those used in AI infrastructure. The company manufactures the extreme ultraviolet (EUV) lithography machines essential for producing the most sophisticated chips. As AI adoption accelerates, demand for these tools has skyrocketed. This trend was reinforced by Taiwan Semiconductor Manufacturing Co. (TSMC), which reported another record quarterly profit, underscoring the strength of the AI chip supply chain. TSMC, a key customer of ASML, produces chips for major AI players like Nvidia and AMD. Meanwhile, a growing shortage of memory semiconductors has driven prices sharply higher, with industry experts predicting the supply crunch could persist through 2027. This is expected to prompt memory giants like Samsung and SK Hynix to expand production capacity, which would in turn increase demand for ASML’s equipment. ASML’s shares have climbed nearly 30% year to date, reflecting strong investor confidence in the company’s central role in the future of semiconductor manufacturing.