The thesis
Chipmakers are on track to spend a record $144 billion on fab equipment in 2026, much of it for AI chips and HBM. The stocks got there first: in April 2025 most members sat in the bottom fifth of their own five-year EV/Sales range, and by January Applied, Lam and KLA hit the top. They have eased since July.
By Jake, founder of StockResearch.app · Oct 28, 2026 · Opinion, not investment advice
A record year for equipment orders
Every new chip factory, and every upgrade to an old one, is mostly a bill for equipment. SEMI, the industry association, expects wafer fab equipment sales to rise 23% to $143.9 billion in 2026 and total equipment sales to keep growing through 2028 (SEMI, via I-Connect007). It names leading-edge capacity for AI in Taiwan and HBM in Korea as the drivers.
The companies are reporting it. Lam’s September quarter revenue was $8.22 billion, up 54% from a year earlier, and it guided to $8.6 billion for December (Lam 8-K). ASML posted record quarterly sales of €11.7 billion and said its planned supply for 2027 and 2028 “will not fully meet the demand of our customers” (ASML 6-K).
From the bottom of the range to the top in nine months
In the week of April 7, 2025, after the tariff sell-off, Axcelis, Cohu, Entegris, Ichor, Photronics and Amkor sat at or near the lowest EV/Sales readings of their own previous five years. Applied Materials was at the 35th percentile and Lam at the 43rd. By the first week of January 2026, Applied, Lam, KLA, Teradyne and Amkor were at the 100th: higher than any weekly reading in five years.
Most of that move was price, not revenue. Applied’s trailing revenue grew about 3% between those dates while its share price roughly doubled. When we wrote this (October 28, 2026), the group had eased from its July highs: Applied sat at the 88th percentile, Lam the 84th and KLA the 86th. Every ranked member was above its five-year median, from Photronics at the 61st to Cohu at the 93rd.
Why this page ranks on sales, and who is not ranked
Equipment earnings swing with chipmakers’ budgets, so trailing P/E reads low near a peak and high or missing near a trough. Ichor, Cohu and Aehr report losses today. EV/Sales still has a reading through a loss and counts debt, so it is the headline; switch the chart to P/E to compare.
ASML files annual reports as a foreign issuer and Tokyo Electron lists in Tokyo, so both show a current value without a weekly rank. Axcelis and Veeco agreed to merge in September 2025; the deal still needs China’s approval, and the page will record the change when it closes. Nine of these companies joined our data on October 28, 2026, each held to the same filing-date checks as the rest of the site.
What could break the cycle
China is the swing buyer. It was 35% of Lam’s September quarter revenue, up from 26% in June (Lam 10-Q), and Lam expects it to fall significantly in December as domestic Chinese customers spend less (call summary). ACM Research sells mostly to Chinese chipmakers. A July report that China had begun producing its own immersion lithography machines hit equipment stocks (Bloomberg).
Equipment is also where a slowdown shows first. Chipmakers can delay a tool order in a quarter; they cannot easily cut wafer starts at a running fab. The AI Memory theme tracks the HBM makers buying many of these tools, and AI Infrastructure the chip designers whose orders fill the fabs.
What would change the view
- A large chipmaker or memory maker cutting its 2027 capital spending plan.
- China’s share of equipment sales falling faster than other regions can replace.
- New US export rules on tools, parts or servicing in China.
- Chinese lithography or etch tools reaching volume production.
- Lead times for ASML’s EUV machines shortening instead of stretching.