Shares of ASML extended a two-day rally on Monday, climbing 4.5% to $1,827.67 as investors priced in momentum from Elon Musk's weekend endorsement and anticipation around today's closed-door technology conference. Musk publicly described ASML as "arguably the greatest company in Europe" and confirmed he would appear virtually at the chipmaker's private conference on June 9–10 to discuss Terafab, the $55 billion SpaceX-Tesla chip fabrication project planned for Texas. The stock is now up roughly 11% in two sessions — but the fundamental question is whether a celebrity endorsement and an unbuilt factory justify the surge.
Musk Needs ASML More Than ASML Needs Musk. ASML is the only company on Earth that makes extreme ultraviolet lithography machines — the equipment required to print circuit patterns smaller than 7 nanometers. No other company produces commercial EUV systems at volume.
Because Terafab targets 2nm-class chip production using Intel's 14A process, it has no viable path to production that bypasses ASML equipment. That gives ASML enormous pricing power over any new customer, including Musk.
The Order Pipeline Is Potentially Enormous — but Still Theoretical. A Texas regulatory filing put Terafab's cost at a minimum of $55 billion, with potential expansion costs reaching $119 billion.
A modern leading-edge fab requires between 80 and 100 lithography scanners , and ASML's newest systems carry an estimated price above $380 million each. That implies billions in potential equipment orders. Yet no timeline has been given for when construction would begin , and Musk has not announced binding purchase commitments.
Strong Fundamentals Underpin the Hype — With Caveats. In Q1 2026, ASML posted revenue of €8.8 billion and net profit of €2.8 billion; full-year guidance calls for sales between €36 billion and €40 billion with a gross margin of 51% to 53%. But ASML's elevated price-to-earnings ratio of approximately 54x is facing scrutiny from analysts who question its sustainability given projected demand slowdowns and geopolitical risks.
Morningstar issued a Sell rating in May 2026, and the proposed MATCH Act in Congress could ban remaining equipment sales to China, costing an estimated 17% of revenue.
Employee Backlash Adds a Quiet Risk. The invitation has triggered critical responses on ASML's internal communication channel, with some employees citing Musk's political views and several staff members considering boycotting the event. For a company whose competitive edge depends on retaining scarce engineering talent in the Netherlands, cultural friction is not trivial.
ASML remains the irreplaceable supplier in the AI chip boom. But at 54x earnings and a $674 billion market cap, shareholders are already paying for a future where projects like Terafab deliver. The conference may generate headlines — concrete orders would be far more valuable.