Layoffs used to be a sign that the company was not doing well. Perhaps management misjudged a business cycle, a new technology hurt margins, or a geopolitical event knocked out a key market.
Yet ASML (NASDAQ:ASML) has stunned the market by announcing a 1,700-job cut in January, during some of the firm’s best times.
The message landed awkwardly, not because layoffs are unusual in tech, but because of the timing. On the same day, the company reported blockbuster results. Gross margins hit 52.2%, while full-year revenue reached €32.7 billion ($37.75 billion), with guidance of up to €39 billion ($45.03 billion) for 2026.
To understand why this feels so contradictory, it helps to zoom out for a second. ASML isn’t just another tech company riding the AI boom. It’s the bottleneck. The company builds the lithography machines that print the world’s most advanced chips, the kind used in cutting-edge AI systems. Without those machines, the entire ecosystem grinds to a halt.
There is no real substitute, no parallel supplier waiting in the wings. That’s what makes the current moment so hard to reconcile. A company at the center of the AI transformation is cutting jobs while demand surges.
Streamlining The Machine
ASML has been fairly explicit about the rationale. Growth, it says, has made it slower. Engineers, its most valuable resource, are spending too much time navigating internal processes rather than building things.
The …Full story available on Benzinga.com
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