Investing.com -- ASML shares rose on Thursday after Barclays upgraded the stock to Overweight, pointing to record orders, accelerating AI-driven demand, and multiple upside scenarios that the bank believes are not yet fully reflected in estimates.

“Expectations were high heading into results but the hope materialised into record orders which drives material upgrades to estimates,” analyst Simon Coles said in a note.

The bank lifted its price target to €1,500 from €1,200, arguing there remains “scope for further upside” as guidance appears conservative.

The stock rose 4% in U.S. premarket trading.

Alongside record orders, ASML on Thursday also lifted its 2026 outlook, reflecting accelerating demand tied to artificial intelligence and data-center investment.

Order intake surged to an all-time high of €13.2 billion, nearly doubling from €7.1 billion a year earlier and well above the €6.32 billion expected by analysts tracked by Visible Alpha.

The company raised its 2026 revenue forecast to a range of €34 billion to €39 billion, topping consensus expectations of about €35 billion, according to LSEG. It had previously guided for sales to be flat to modestly higher versus 2025 revenue of €32.7 billion.

The Dutch chip equipment maker also unveiled plans to cut around 1,700 jobs, roughly 3.8% of its workforce, as part of a broader restructuring that will remove about 3,000 management roles while expanding engineering teams focused on innovation.

Barclays highlighted growing lithography requirements tied to large-scale data centre rollouts, while also pointing to other potential upside factors including consumer AI adoption, humanoid robotics and improved sustainability of memory capital spending.

Foundry competition was singled out as particularly supportive, with Coles saying he sees “upside risk from this competition driving increasing investment which should benefit ASML/semicap into 2027.”

Concerns around China exposure were also described as overdone for now. Coles said ASML’s cautious stance on the region had reflected earlier visibility issues and export control risks, but recent trends suggest demand remains resilient.

“These seem unnecessary for 2026 with ASML sensibly setting guidance that implies China down more than 10% yoy to start but recent import strength would suggest demand remains strong,” he wrote.

While China is estimated to have fallen to around 50% of DUV bookings, the analyst noted this still represents levels comparable with prior record quarters.

The upgrade was accompanied by material increases to forecasts, with Barclays now expecting revenues to grow at a low-teens pace in both 2026 and 2027, translating into mid-to-high-teens upgrades to earnings per share.

Additional upside could come from a stronger recovery in challenger foundry spending, better-than-expected China demand through 2026, and further acceleration in AI-driven investment over the coming years.