ASML Holding's Next Earnings Report on Oct. 14 Could Send the Stock Soaring. Here's Why.

There's a good reason why ASML Holding (NASDAQ:ASML) is one of the most important companies in the semiconductor industry. And investors are about to get another look at just how valuable its technology has become.

The Dutch company will report third-quarter earnings on Oct. 14, and expectations are already running high. Analysts anticipate a big increase in revenue and earnings compared to a year ago, driven in part by demand for the advanced chips that power artificial intelligence (AI).

I like ASML because it has a competitive advantage that even the biggest names in the semiconductor industry can't easily duplicate. That could make Wednesday's earnings report especially interesting.

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A competitive advantage that's hard to beat

ASML doesn't manufacture semiconductors. Instead, it makes the equipment that companies like Taiwan Semiconductor Manufacturing, Intel, and Samsung use to produce them.

Its specialty is lithography, a process that uses light to print microscopic patterns onto silicon wafers. Those patterns form the transistors and connections that make semiconductor chips work. ASML is the world's only commercial manufacturer of extreme ultraviolet (EUV) lithography machines, which are needed to produce many of today's most advanced chips.

Chipmakers like Nvidia and Advanced Micro Devices are spending billions developing increasingly powerful processors. And they turn to foundries like Taiwan Semiconductor, Intel, and Samsung to make those chips. But each of those foundries depends on ASML's EUV equipment.

ASML is already working on the next generation of EUV equipment. Intel has used its High-NA EUV technology to process more than 1 million wafers across development, testing, and manufacturing, including selected layers of its Panther Lake processors. Samsung plans to introduce the technology into advanced DRAM memory production by 2028.

So, ASML isn't just benefiting from today's semiconductor demand. Its equipment is also being incorporated into the manufacturing plans for tomorrow's chips.

Wall Street is expecting big numbers

ASML reported second-quarter revenue of 9.3 billion euros ($10.39 billion), compared to 7.7 billion euros a year earlier. Net income increased to 2.9 billion euros from 2.3 billion euros.

But management expects an even stronger third quarter. The company issued guidance for revenue between 11 billion and 12 billion euros, with a gross margin between 55% and 57%. It also raised its full-year revenue outlook to between 43 billion and 45 billion euros.

Wall Street is looking for third-quarter revenue of 11.73 billion euros, a 55% increase from a year ago. Earnings are expected to reach 10.76 euros per share, compared to 5.49 euros in the third quarter of 2025.

Those are substantial increases. But investors should also pay attention to what management says about orders and manufacturing capacity. ASML says its customers are accelerating their expansion plans, and the company plans to increase production capacity for its existing EUV systems by about 30% in 2027.

Could ASML stock move higher?

ASML is already having a big year, with the stock up 66% in 2026. But the company still has some room for more growth. Nvidia and other chip designers are racing to produce increasingly powerful AI processors. Taiwan Semiconductor, Intel, and Samsung are investing in the facilities needed to manufacture them.

ASML supplies technology that those manufacturers can't simply purchase from another vendor.

I'm expecting ASML to show another strong quarter. But if the company's guidance indicates that the AI build-out is still going gangbusters, then ASML stock could have a very good day when the company reports earnings on Oct. 14.

Patrick Sanders has positions in Nvidia. The Motley Fool has positions in and recommends ASML, Advanced Micro Devices, Intel, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.