These AI growth stocks will continue to undercut the S&P 500 in 2026.

These AI growth stocks will continue to undercut the S&P 500 in 2026.

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  • ASML’s extreme ultraviolet lithography machines are essential for creating the most complex AI chips.

  • These machines account for an increasing share of ASML’s sales, which should gradually increase margins.

  • ASML is a top growth stock to buy and hold for years to come.

  • 10 Stocks We Like More Than ASML ›

After a brutal sell-off in April ASML (NASDAQ: ASML) has fully recovered and is now up a staggering 45.7 percent year-on-year, up from 13.4 percent. S&P 500 (SNPINDEX: ^GSPC).

Let’s dive into the semiconductor equipment company’s third-quarter earnings and full-year guidance to see why it could continue to undercut the S&P 500 in 2026. and later.

Image source: ASML.

In the third year of 2025 ASML posted net sales of €7.5 billion in the quarter, with Q4 sales of €9.2 billion to €9.8 billion, which would be around €32.5 billion on the year. That number is right in the middle of what ASML originally predicted when it reported in January. published its full year 2024 results.

ASML expects a full-year gross margin of just over 52%. It also reaffirmed its 2030 to reach the goals of 44-60 billion EUR income and 56-60 percent. gross profit.

ASML’s margins will increase as its next-generation extreme ultraviolet (EUV) systems account for an increasing share of revenue. In the last quarter, ASML registered the sale of 9 EUV machines, one of which was a large digital aperture (large NA) system.

High-NA is the most advanced version of ASML’s EUV offering. Based on EUV sales of €3.6 billion, simple math shows that 9 ASML EUVs were sold at an average price of €400 million. And together, these nine units accounted for nearly all of ASML’s sales for the quarter, demonstrating how EUV is changing ASML’s business and the makeup of today’s semiconductor manufacturing facilities.

EUV represents a new age in chip manufacturing. These machines are expensive, but they enable manufacturing companies to carry out complex artificial intelligence (AI) software projects. EUV uses light with a wavelength about 14 times shorter than traditional deep ultraviolet machines (which are also manufactured by ASML). These shorter wavelengths allow printing smaller features with fewer steps. In other words, there are more transistors per chip, and higher transistor density means higher computing power and efficiency.

EUV is critical to fulfilling orders for certain chips, especially sub-3 nanometer assemblies. EUV will play an ever-increasing role in semiconductor manufacturing, as favored by chip designers Nvidia, Broadcomand Advanced Micro Devices and continue to push the limits of chip architecture to handle complex workloads.

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