ASML Stock: Trump Tariff Threats Send Shares Down 3% Monday

TLDR

• ASML stock fell 3.3% on Monday as President Trump threatened 10% tariffs on eight NATO countries including the Netherlands, escalating to 25% by June 1
• The tariffs could hurt U.S. chip companies like Intel and Micron that rely on ASML’s lithography machines, which cost up to $400 million each
• ASML holds a near-monopoly on lithography equipment needed for advanced semiconductor manufacturing, with the U.S. accounting for 16% of its 2024 revenue
• Just days earlier, ASML hit record highs after TSMC’s strong earnings, with shares rallying 25% in 2026 and market cap reaching $522 billion
• Morgan Stanley’s bull case predicts ASML stock could surge 70% as chipmaker spending rises to meet AI demand

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ASML stock dropped 3.3% in Netherlands trading on Monday. The decline came after President Trump threatened new tariffs on NATO member countries.

ASML Holding N.V., ASML

Trump announced plans to impose 10% tariffs on eight NATO nations starting February 1. The list includes the Netherlands, Germany, and France.

The tariffs would escalate to 25% by June 1 unless countries agree to U.S. acquisition of Greenland. The announcement sparked concerns about a potential trade war between the EU and U.S.

ASML holds a near-monopoly on lithography machines needed for advanced semiconductor manufacturing. These machines can cost up to $400 million each.

The U.S. accounted for 16% of ASML’s revenue in 2024. However, year-to-year figures can vary due to the high price of individual machines.

The tariff threat poses a challenge for American chip companies. Intel and Micron Technology both rely on ASML’s equipment for production.

Foreign companies investing in U.S.-based facilities would also feel the impact. Taiwan Semiconductor Manufacturing operates American factories that need ASML’s machines.

Other European semiconductor stocks joined the selloff Monday. Germany’s Infineon Technologies fell 3% while STMicroelectronics dropped 4.8%.

Recent Rally Now Under Pressure

The Monday drop reversed ASML’s recent momentum. Shares had rallied 25% in 2026 before the tariff announcement.

ASML hit record highs just days earlier following strong earnings from TSMC. The company’s market cap reached $522 billion, making it Europe’s most valuable company.

TSMC’s strong fourth-quarter results had boosted confidence in chipmaker spending. The Taiwanese company exceeded capital expenditure expectations in its guidance.

Morgan Stanley issued a bullish note on Thursday with a 1,400 euro price target. The bank’s bull case scenario sees shares reaching 2,000 euros, a 70% surge from current levels.

AI Demand Still Driving Long-Term Outlook

Bank of America highlighted ASML’s critical role in meeting AI chip demand. The firm noted that extreme ultraviolet and advanced deposition tools are becoming essential for efficiency gains.

JPMorgan said ASML could see strong capital expenditure from semiconductor manufacturers starting in late 2026. Samsung is likely to increase orders for DRAM production capacity.

Memory chip prices are expected to rise another 40-50% in the first quarter of 2026. This trend supports demand for ASML’s equipment.

TSMC received favorable treatment in the tariff announcement. The U.S. limited tariffs on Taiwan to 15% for companies investing at least $250 billion in American production capacity.

ASML is scheduled to report fourth-quarter earnings on January 28. The company became the third European firm to reach a half-trillion dollar valuation.

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