ASML Holding NV ADR (ASML.US) performance has been a mixture of joy and sorrow, Goldman Sachs Group, Inc. still remains bullish.

Goldman Sachs Group, Inc. recently released a commentary report on ASML Holding NV ADR (ASML.US) first quarter performance. The company's Q1 performance met the average market expectations, with pre-tax profits exceeding expectations. They labeled 2025 and 2026 as years of growth, but noted that the order volume was lower than market consensus and the 2025 performance guidance was also below market consensus. They expect the company's stock price to initially have a mixed reaction, but maintain a buy rating with a target price of 1010 euros. ASML Holding NV ADR's revenue for the first quarter of 2025 met expectations, but pre-tax profits (EBIT) were higher than VisibleAlpha's consensus expectations. This was attributed to an increase in gross profit, which was driven by the higher proportion of the 3800E tool in the product mix (which has a higher average selling price) and performance bonuses for specific customer targets. The company's order intake for the first quarter of 2025 was 3.9 billion euros (lower than the strong order intake of 7.1 billion euros in the fourth quarter of 2024, and below VisibleAlpha's consensus data of approximately 4.8 billion euros), with extreme ultraviolet lithography (EUV) equipment orders at 1.2 billion euros (below the market expectation of 1.6 billion euros). It is worth noting that the order intake of 3.9 billion euros in the first quarter of 2025 is higher than the order rate needed to meet market expectations for 2026 (i.e. 3-4 billion euros). The company also delivered a high numerical aperture (HighNA) tool in this quarter, which may be viewed positively by investors. The company acknowledges the macroeconomic uncertainty but believes that artificial intelligence is the main driver in their market. Furthermore, based on their conversations with customers, they expect both 2025 and 2026 to be years of growth. ASML Holding NV ADR announced net sales guidance for 2025, approximately 72-77 billion euros, and expects gross margins in 2025 to be around 50%-53%, with a wider range to reflect macroeconomic uncertainty. This implies sales/gross profit/pre-tax profit ratio lower than market consensus by 4%/6%/10%. Additionally, ASML Holding NV ADR reiterated its 2025 performance guidance, with expected sales of 30-35 billion euros and gross margins of 51%-53%. The bank also noted that the gross margin guidance for 2025 from ASML Holding NV ADR includes some dilutive effect from the ramp-up of High NA products, but they still see a possibility of achieving the gross margin target for the fiscal year 2025 due to the expected deliveries of 3800E being the main low numerical aperture tools. In terms of end market trends, ASML Holding NV ADR expects the advanced logic market to remain strong, as customers are progressing in the research and development of 2 nanometer technology nodes. The memory market is expected to be stable compared to last year, with strong performance, and the installation base management business will also see growth due to the use of more EUV equipment. The company believes the memory market will maintain the same strong level as last year, with customer activities confirming this. Furthermore, with the combination of EUV equipment and deep ultraviolet lithography (DUV) equipment becoming stronger, ASML Holding NV ADR's installation base is continually expanding. Finally, the company reiterated its long-term revenue and gross margin guidance for 2030. From a broader perspective, the bank expects investors to seek more dynamic information on recent semiconductor equipment tariffs, end market demand, foundry/frontier customer latest order expectations, etc. Given the key performance indicators (KPIs) for this quarter exceeding market consensus, and the company labeling 2025 and 2026 as years of growth, but with orders lower than market consensus and 2025 performance guidance below market consensus, the bank expects the company's stock price to initially have a mixed reaction. It is worth mentioning that in the past three months, the performance of ASML Holding NV ADR has been 6% lower than the European tech stock index, with an absolute decline of 11% year-to-date.