Japan Chemicals: Specialty: ASML 3Q read-across: EUV for DRAM accelerating, positive for advanced materials, including resists

ASML, the world's largest semiconductor production equipment maker, held its 3Q26 earnings call. ASML's 3Q sales came in near the upper end of its guidance range, and gross margin beat the upper end of guidance (57%) to reach a record high (57.5%). The company said it would not be able to meet strong customer demand even with plans to expand capacity in 2027-2028 by +30% per year, and indicated it is considering further capacity expansion in 2028. With new customers for Low-NA EUV increasing particularly in DRAM, and throughput improvements from existing equipment upgrades leading to an increase in wafer processing volume outpacing the number of units, we think the outlook for advanced materials centered on 300mm wafers and EUV resists has become more robust. Overall, we see a positive read-across for Japanese semiconductor materials makers, primarily Shin-Etsu Chemical, Tokyo Ohka Kogyo, and SUMCO (all Buy-rated).