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ASML's Q3 earnings beat expectations and demand is already growing beyond planned capacity

CANATUAnalyst Comment2026-10-14 08:29
Atte RiikolaAnalyst
Discuss

Summary

  • ASML's Q3 earnings exceeded expectations, with revenue reaching 11.7 BEUR and a gross margin of 57.5%, driven by strong performance in the installed base business.
  • The company raised its full-year 2026 revenue guidance to 44-45 BEUR and expects a gross margin of around 56%, surpassing previous estimates.
  • ASML anticipates that its current capacity plans will not meet customer demand for 2027-2028, prompting exploration of further capacity increases.
  • The growth of ASML's EUV system installed base supports Canatu's long-term growth potential, though Canatu's near-term revenue is expected to decrease significantly in 2026.

This content is generated by AI. You can give feedback on it in the Inderes forum.

Translation: Original published in Finnish on 10/14/2026 at 08:50 am EEST

ASML, which practically holds a virtual monopoly in EUV systems, reported a Q3 result that exceeded expectations on Wednesday. The company raised the lower end of its full-year 2026 revenue guidance and its margin guidance. However, the most interesting message of the report concerned the longer term, as ASML estimates that its already aggressively scaled-up capacity will not be sufficient to cover customer demand in 2027-2028. From the perspective of Canatu's longer-term development, the report is positive, as the growth of the EUV installed base is the key driver for future demand for the company's pellicles made from carbon nanotubes.

Margin and earnings exceeded expectations, revenue in line

ASML's Q3 revenue increased by 55% to 11.7 BEUR and settled at the top of the guidance range (11.0-12.0 BEUR). Revenue were in line with the consensus estimate (11.7 BEUR). The gross margin rose to 57.5% and exceeded both the consensus estimate (~56%) and the company's own guidance (55-57%). The beat was driven by installed base business (services and upgrades). Customers seek to quickly add more capacity to their existing equipment through upgrades, and the high margin of the upgrades boosts the company's margin as a whole. EPS was EUR 12.95, clearly exceeding the consensus estimate of EUR 10.8. Earnings were supported by a valuation increase of around 0.5 BEUR from ASML's investment in Mistral AI, but even adjusted for this, the earnings performance was better than expected, driven by a strong gross margin.

For Q4, ASML guides for revenue of 14.2–15.2 BEUR and expects the gross margin to be ~57%. ASML now expects full-year revenue for 2026 to be 44-45 BEUR (previosuly 43-45 BEUR) and a gross margin of around 56 % (previously 54-56%). The revenue guidance is in line with consensus (~44 BEUR), but the margin guidance exceeds the consensus's previous expectation of 55.1% following a strong Q3. Growth of ~36% this year is driven by the EUV business, which ASML expects to grow by over 45%, supported by the delivery of ~65 EUV systems. The growth expectation for the installed base business rose to around 50% (previosuly over 30%). In addition, the company has completed negotiations on value-based pricing with its key customers, the impact of which will be partially visible in 2027 and in full starting from 2028.

Demand already exceeds planned capacity

ASML no longer reports its orders quarterly, so the longer-term demand picture relies on management's comments. According to the company, customers have raised their short- and medium-term equipment demand forecasts, and some of them would like to place orders already for 2029 and 2030. ASML now estimates that the capacity plan announced in connection with Q2 earnings will not be sufficient to cover customer demand in 2027 and 2028. According to the plan, ASML will increase its manufacturing capacity for current-generation EUV systems and advanced DUV systems by 30% in 2027 and potentially another 30% in 2028. The company is now exploring ways to increase its 2028 manufacturing capacity even beyond this. In addition to system volumes, ASML is increasing its customers' capacity with productivity upgrades and new equipment generations. According to ASML, High NA EUV technology is progressing towards broader mass production. According to the company, Samsung has stated that it will take High NA into mass production in 2028 and TSMC around 2030. Intel, in turn, is already using the technology in mass production and is scaling up its use.

Growth of the EUV system installed base supports Canatu's long-term growth story

The use of ASML's latest EUV systems exceeding 600 watts requires pellicle membranes to protect the photomask, and in these systems, the properties of Canatu's carbon nanotube membranes are, to our understanding, clearly superior to traditional composite membranes. The Q3 results reinforce the picture that the installed base of EUV systems will grow strongly in the coming years and potentially even faster in 2028 than previously planned. The more and the more efficient EUV systems are delivered to customers in 2027-2028, the larger the potential market for Canatu's pellicles will be. Also, the inclusion of High NA in the mass production plans of multiple customers indicates that the most advanced EUV lithography is developing in the right direction.

However, we remind readers that ASML's strong momentum does not directly translate to Canatu's near-term figures. Canatu expects its 2026 revenue to decrease significantly, and the revenue related to FST's new reactor order will be recognized mainly in 2027. For Canatu's investment case, the most crucial factor is how quickly its reactor customers progress to the mass production of CNT pellicles, enabling the company to start generating recurring royalty and consumable revenue. ASML's demand outlook improves the starting point for this market, but the timing of Canatu's growth depends above all on customers' own production schedules and new reactor orders from both current and new customers.

Canatu is a technology company active in deep technology that creates carbon nanotubes (Canatu CNT), related products and manufacturing equipment for the semiconductor, automotive and medical diagnostics industries. The company operates through two business models, firstly using their own reactors to develop and manufacture CNT products. Second, the company sells its CNT reactors and licenses its related technology, allowing customers to produce the products themselves under a limited license.

Read more on company page

Key Estimate Figures25/08

202526e27e
Revenue15.69.625.6
growth-%-29.2 %-38.6 %167.5 %
EBIT (adj.)-10.2-22.7-12.4
EBIT-% (adj.)-65.1 %-236.6 %-48.5 %
EPS (adj.)-0.27-0.56-0.27
Dividend0.000.000.00
Dividend %
P/E (adj.)neg.neg.neg.
EV/EBITDAneg.neg.neg.

Forum discussions

Returning to ASML’s roadmap, it looks like the promised 3800F model with a 600 W power laser will hit the market as promised. In the ASML earnings...
7 hours ago
by Pandakarhu
10
Another strong result from ASML, and the demand outlook for the coming years is only strengthening. This bodes well for Canatu’s longer-term...
16 hours ago
by Atte Riikola
39
Asianometrylla video TSMC:n ja ASML:n suunnitelmista siirtyä High NA -koneisiin ja 6x12" fotomaskeihin ensi vuosikymmenen alkupuolella. Canatukin...
10/2/2026, 2:05 AM
by Ilkka
18
As a new shout-out/notice from the top 100 owners list, because he is no longer an insider: Juha Kokkonen (though theoretically there could ...
10/1/2026, 8:03 AM
7
You’re right. I may have made a wrong deduction during my research. That was an inference I drew, not a confirmed fact. Sorry for the confusion...
9/23/2026, 7:31 PM
by Lszatmary78
6
It’s really hard to say anything sensible about this from the outside, since I don’t have visibility into Mitsui’s operations. [quote="lszatmary78...
9/23/2026, 12:09 PM
by Atte Riikola
7
Here the guys at Canatu might have been reading TSMC’s history. What makes TSMC remarkable is not simply its scale, but the way it achieved ...
9/23/2026, 11:23 AM
by Karibu
12