ASML: Stock Story

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Tell us about the company

Paul Taylor: Every gadget you use, from your smartphone to your computer, contains chips quietly working away so that you can do things like watch videos, store images or connect to Wi-Fi. At the heart of this technology is ASML, the company responsible for creating arguably the most complex machine the human race has ever invented. Imagine a device that can print patterns thousands of times smaller than the width of a human hair. That's exactly what ASML's lithography machines accomplish.

What makes this stock special?

ASML holds a unique position in the global technology landscape, as it is the sole supplier of leading-edge lithography machines. No one has been able to copy what they do. These machines are about the size of a small house, cost in excess of $200mn, and produce plasma that is 40 times hotter than the surface of the sun to create an ultraviolet or EUV beam necessary for producing leading-edge chips.

We first invested in ASML when its achievements were merely the visionary dreams of its chief technology officer, Martin Vandenbrink. Since then, we've witnessed the company's remarkable success, driven by his ambition and determination.

What could the future hold?

The question we're asking ourselves now is, where from here? Given our long-term investment horizon, we're thinking about the roadmap for semiconductors over the next 10 years. To help us in our task, we've nurtured relationships with leading academic institutions engaged in semiconductor research and development, in order to better understand the hurdles the industry is seeking to overcome and how ASML may fit into this picture.

At the center of ASML's success and its future growth prospects are its unwavering commitment to innovation and research and development. With the increasing demand for more powerful and more efficient chips in quantum computing, artificial intelligence and beyond, ASML's relentless pursuit of innovation promises to continue shaping our digital future in ways that we can only begin to imagine. 

Risk factors

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This communication was produced and approved in April 2025 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.

This communication contains information on investments which does not constitute independent research. Accordingly, it is not subject to the protections afforded to independent research and Baillie Gifford and its staff may have dealt in the investments concerned.

As at April, 2025, Baillie Gifford held ASML. A full list of holdings is available on request and is subject to change.