Artificial intelligence

ASML occupies a critical position in the global semiconductor supply chain as the sole producer of extreme ultraviolet lithography systems. These machines are essential for manufacturing the most advanced chips used in artificial intelligence applications. As demand for AI computing has surged, driven by data centre expansion and high performance processing needs, the semiconductor industry has entered a new investment cycle focused on capacity growth.

Strong earnings and upgraded forecast

ASML reported first quarter earnings that exceeded expectations and raised its 2026 revenue outlook to between 36 billion and 40 billion euros. This revision signals stronger than anticipated order inflows and reinforces the scale of demand emerging from the AI sector.

The company’s performance reflects a broader trend in which chip demand is outpacing supply. According to CEO Christophe Fouquet, customers are accelerating expansion plans well beyond the near term, indicating confidence in sustained AI driven growth.

ASML as a strategic enabler of AI growth

Investors increasingly view ASML as a foundational player in the AI ecosystem rather than a conventional manufacturer. Its tools are used by leading chipmakers such as TSMC, which produces advanced processors for firms like Nvidia and Apple.

This positioning places ASML at the upstream end of the value chain. Instead of competing in chip design or production, it supplies the essential infrastructure that enables both. As a result, its growth is tied to the entire semiconductor sector rather than any single company.

Supply constraints and industrial limits

Despite strong demand, structural constraints remain significant. Semiconductor fabrication plants require years to build and involve complex global supply chains. ASML itself faces production bottlenecks due to the precision and cost of its machines, which can reach hundreds of millions of dollars per unit.

Even with plans to increase shipments of its leading systems in 2026 and 2027, capacity expansion is gradual. This creates a persistent imbalance where demand continues to exceed supply, reinforcing pricing power across the industry.

Geopolitical and regulatory risks

A key uncertainty for ASML lies in export controls, particularly regarding sales to China. Proposed restrictions in the United States, including the MATCH Act, could limit the company’s ability to supply Chinese customers. Currently, China represents a significant portion of ASML’s revenue.

However, the global shortage of advanced chips may mitigate this risk. Reduced access to one market could be offset by demand from others, especially as countries and companies compete to secure semiconductor supply chains.

Market response and valuation concerns

ASML’s share price has risen sharply, reflecting investor optimism around AI driven growth. The company is often described as a “picks and shovels” investment, benefiting from the broader expansion of the industry regardless of which firms dominate end products.

At the same time, analysts caution that valuations are elevated. The current pricing assumes sustained high growth, leaving limited room for setbacks related to supply constraints or regulatory changes.

Analysis

The upgrade in ASML’s forecast highlights a structural shift rather than a temporary cycle. AI is not only increasing demand for chips but also reshaping the entire semiconductor value chain. ASML’s monopoly in EUV technology gives it a unique strategic advantage, effectively making it a gatekeeper for next generation chip production.

However, this dominance also exposes the company to geopolitical pressures and operational challenges. The interplay between technological leadership, supply limitations, and regulatory dynamics will determine whether current growth trajectories can be maintained.

ASML’s stronger outlook underscores the depth of the AI driven semiconductor boom. While demand momentum remains robust, the company operates within a constrained and politically sensitive environment. Its future performance will depend on balancing rapid industry expansion with the physical and geopolitical limits shaping the global chip ecosystem.

With information from Reuters.

ANASTACIA Kingsnorth has been a queen of social media since starting her YouTube Channel aged 11 – but now a fierce backlash is threatening her empire.

The Brit content creator, 25, has ventured into podcast hosting, has written her own book and been the face of many ad campaigns.

Yet this year, the TikTok star – who has a rumoured net worth of over £1million – faced a sticky spot after her boyfriend appeared to cause “jealous” tension with her pal, Love Island alum Saffron Barker.

And now fans have reacted in fury after her latest paid partnership with Air Up featured a clip created by AI.

Earlier this week, Oh Anna podcast host Anastacia took to her socials to upload a clip promoting the German based brand’s latest flavoured water.

Scenes showed a giant version of the star wearing a lemon polka dot co-ord as she strolled through the London streets.

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Her height meant she could scoop up a pink water bottle branded with the Air Up logo before she took a sip.

The slurp appeared to transport her into both a new location – the roof of Buckingham Palace – and a new denim pinstripe outfit.

She wrapped the clip by visiting locations including St Paul’s Cathedral and Big Ben.

Yet on TikTok, her followers have alleged she has used AI to create the scenes – and claimed the technology goes against Air Up’s environmentally friendly credentials.

Criticisms came from two angles – the nature of content creation as a creative process, and also for AI using huge volumes of water, seemingly going against green principles.

The Sun has gone to Anastacia’s rep for comment.

Fans have claimed Anastacia, whose content focusses on lifestyle, leisure and beauty, has abandoned the “creative process” with her latest venture.

One TikTok user, who works in marketing, ranted: “Honestly, I am not happy about it.

“And I don’t think a lot of people are, judging by the comments on the video”.

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She added: “It really cuts down on what content creation really is.

“If you work in marketing like myself you will know that this is totally wrong.

“The whole point of content creation is creative process”.

Fans of Anastacia, who has previously collaborated with ITV bosses for a Love Island promotion, continued to take to the comments in fury.

One simply posted: “Who’s idea was this?? Omg”.

A second mused: “I do like some of their content, but Ana and her family don’t seem hugely aware or maybe even that bothered by environmental issues unfortunately. (a LOT of consumption etc!)”.

A third added: “The funny part about it is , the ad is for a refillable water bottle (to try and tackle plastic waste etc) but then it the ad is literally AI!! you couldn’t write it honestly”.

A fourth mused: “The hypocrisy of these ‘influencers’ is gross tbh”.

“I’m surprised the brand approved it to be honest…says a lot about them too! I think being aware of the environmental impact AI has is important too”.

And another user surmised: “For me its the context of the ad being for a refillable water bottle while using AI which uses tons of water. It is a little ironic”.

Campaigners have previously flagged the significant carbon, energy and water use that AI requires.

Previously, Sasha Luccioni, climate lead at AI company Hugging Face told The Guardian: “What I’m worried about is that we’re deploying AI in such a way that we don’t have a good idea of the energy use.

“We’re essentially operating on the hypothesis that it’s not a problem – or that if it is a problem it will somehow be solved – instead of getting ahead of it.”

While Anastacia has posted the video to her Instagram grid, the brand is yet to feature it on their page.