Dutch tech giant ASML to cut around 1,700 jobs even as orders beat expectations
Logo of ASML is displayed at the company's booth at the 8th China International Import Expo (CIIE) in Shanghai, China, Nov 5, 2025. (Photo: REUTERS/Maxim Shemetov)
Top computer chip equipment maker ASML logged record orders in the fourth quarter on Wednesday (Jan 28) and boosted its 2026 outlook as demand surged from its AI-focused customers even as it trimmed 1,700 jobs.
The job cuts, a rare move and representing 3.8 per cent of staff, would mostly impact leadership in R&D departments in the Netherlands and US, said Europe's largest company by market capitalisation, with the move needed for technical agility.
Fourth-quarter bookings, the most watched metric in the industry, leapt to a record €13.2 billion (US$15.8 billion), from €7.1 billion a year ago. The orders well exceeded analyst expectations of €6.32 billion, according to researcher Visible Alpha.
Shares were up 4.2 per cent in morning trading, after early jumping as much as 7.5 per cent to a record high. The stock is up 38 per cent this year so far.
"GOING OUT WITH A BANG", AS QUARTERLY DATA TO BE DROPPED
"It will be the last time that ASML reports quarterly order intake and the company is going out with a bang," ING analyst Marc Hesselink said, referring to ASML's plans to discontinue revealing the bookings figure, arguing it causes unnecessary volatility in shares.
The company raised its 2026 sales guidance from €34 billion to €39 billion, beating analyst expectations of €35 billion, according to LSEG data. It previously forecast flat-to-higher sales than €32.7 billion in 2025.
Customers have in recent months been more optimistic "of the medium-term market situation, primarily based on more robust expectations of the sustainability of AI-related demand", ASML's Chief Executive Christophe Fouquet said in a statement.
Net profit in 2025 at the sole maker of the EUV lithography machines - used to print the world's most advanced chips - jumped 26.3 per cent to €9.6 billion, from €7.6 billion a year earlier, on sales of €32.7 billion, up 15.5 per cent from a year earlier.
ORDERS BEAT EXPECTATIONS AS AI CHIP DEMAND SURGES
The orders beat comes as ASML customers TSMC, Samsung, SK Hynix and Micron boost investment plans amid demand for AI logic and memory chips needed by cloud computing giants such as Microsoft, Amazon and Alphabet's Google.
South Korea's SK Hynix also reported record quarterly earnings Wednesday amid the AI boom.
"Overall there is good fourth-quarter orders and 2026 outlook, driven by AI demand for EUV in both logic and DRAM," or memory chips, Mizuho analyst Kevin Wang said in an email.
ASML also said it would buy back €12 billion worth of shares through 2028.
JOB CUTS COME AFTER A LONG PERIOD OF EXPANSION
The cull in jobs was the largest at ASML in absolute numbers, following prolonged expansion in the 2010s and 2020s, CFO Roger Dassen said on a call with journalists.
"Job cuts amidst record bookings should make for fascinating talks with the labour unions," said analyst Michael Roeg of Degroof Petercam.
Analysts had expected the Dutch giant to benefit from stronger demand of top customer TSMC, which manufactures chips for Nvidia, amid tight global supply of memory and AI-accelerator chips.
China is the world's largest buyer of chipmaking equipment, and was ASML's single-largest market in 2025, representing 33 per cent of sales, a figure that has dropped from 41 per cent in 2024.
Dassen forecast that would fall further to 20 per cent in 2026.
US-led export restrictions prevent Chinese chipmakers from buying ASML's most advanced EUV tools and Nvidia's best chips.
ASML kept longer-term guidance to 2030 untouched, CEO Fouquet said, anticipating revenue of between €44 billion and €60 billion and a gross margin of 56 per cent to 60 per cent in 2030.
