The race for better artificial intelligence continues to reshape the market, making investors choose between equipment giants and chip designers. Should you buy ASML (ASML -3.60%) or Marvell Technology (MRVL -7.08%) today?
ASML provides the complex lithography systems used by the world’s leading foundries to print the most advanced microchips. Marvell specializes in infrastructure solutions, connecting and moving massive amounts of data across cloud and carrier networks. Both companies are pivotal to the future of semiconductor technology, but they occupy very different rungs on the industry ladder.
The case for ASML
ASML manufactures the lithography systems that are essential for the production of advanced microchips found in everything from smartphones to data centers. It is currently the sole supplier of extreme ultraviolet (EUV) lithography machines, which its latest annual report, filed for the fiscal year ended Dec. 31, 2025, notes are critical for cost-effective microchip scaling. The company serves the global semiconductor stocks ecosystem by delivering hardware and software for EUV and cheaper deep ultraviolet (DUV) applications.
In the fiscal year ended Dec. 31, 2025, revenue reached $36.7 billion, representing a growth of 15.6% compared with the prior fiscal year. This expansion in the top line helped the company generate a net income of $10.8 billion. The net margin, which measures the percentage of revenue remaining after all expenses are paid, reached 29.4% during this period.
According to its December 2025 balance sheet, the debt-to-equity ratio of nearly 0.2x shows the company uses very little borrowed money relative to its equity. The current ratio of approximately 1.3x indicates it maintains sufficient short-term assets to cover immediate liabilities. Free cash flow, which is the cash left over after accounting for capital expenditures, reached $12.4 billion for the fiscal year ended Dec. 31, 2025.
The case for Marvell Technology
Marvell Technology designs data infrastructure solutions that power artificial intelligence, cloud computing, and automotive industrial end markets across the globe. The company reported in its latest annual report, filed for the fiscal year ended Jan. 31, 2026, that its revenue is highly concentrated among a limited number of buyers. Customer concentration like this adds a layer of risk to the business, as one distributor represented nearly 37% of revenue and a single direct customer accounted for roughly 14%.
In the fiscal year ended Jan. 31, 2026, revenue reached $8.2 billion, representing year-over-year growth of 42.1%. This sharp increase in sales helped the company achieve a net income of $2.7 billion. The net margin for the period reached 32.6%, reflecting a significant improvement compared with the losses reported in the prior fiscal year.
As of its January 2026 balance sheet, the debt-to-equity ratio of roughly 0.3x indicates a healthy balance between debt and equity. The current ratio of approximately 2.0x measures its ability to cover short-term obligations, and free cash flow for the fiscal year ended Jan. 31, 2026, was nearly $1.4 billion. Note that stock-based compensation (SBC) represented 33.8% of operating cash flow, which inflates reported cash generation since SBC is a non-cash expense added back in the cash flow statement.
ASML & MRVL: Performance Comparison
Key Financial Metrics
ASML – ASML
$1,496.30
–3.60% (–$55.84)
MRVL – Marvell Technology
$159.80
–7.08% (–$12.17)
Market Cap
$577B
52wk Range
$946.11 – $1,999.96
Gross Margin
54.33%
P/E Ratio
36.82
EPS (TTM)
$40.60
Dividend & Yield
$9.31 (0.62%)
Market Cap
$140B
52wk Range
$70.69 – $329.88
Gross Margin
51.42%
P/E Ratio
52.62
EPS (TTM)
$3.04
Dividend & Yield
$0.24 (0.15%)
ASML – ASML
$1,496.30
–3.60% (–$55.84)
Market Cap
$577B
52wk Range
$946.11 – $1,999.96
Gross Margin
54.33%
P/E Ratio
36.82
EPS (TTM)
$40.60
Dividend & Yield
$9.31 (0.62%)
MRVL – Marvell Technology
$159.80
–7.08% (–$12.17)
Market Cap
$140B
52wk Range
$70.69 – $329.88
Gross Margin
51.42%
P/E Ratio
52.62
EPS (TTM)
$3.04
Dividend & Yield
$0.24 (0.15%)
Risk profile comparison
ASML faces potential volatility in the global chip market, where cycles of high demand for new equipment can be followed by periods of overcapacity. Geopolitical tensions also pose a significant threat, as trade restrictions on high-end lithography equipment can limit sales to certain geographic regions. Additionally, the extreme complexity of its machines means any production delays or technical hurdles in next-generation systems could impact its long-term growth trajectory.
Marvell Technology faces risks from significant revenue concentration, as a few large customers account for a majority of its annual sales. Strategic and integration risks are heightened by large-scale acquisitions, notably the announced $115 billion all-stock acquisition of Lumentum Holdings (LITE -7.85%). Additionally, the company faces intense competition from Broadcom (AVGO -2.00%) and potential supply chain disruptions due to the geographic concentration of its manufacturing partners.
Valuation comparison
ASML appears more affordably valued based on its Forward P/E and its P/S ratiowhich measures market value against sales over the past twelve months.
| Metric | ASML | Marvell Technology |
|---|---|---|
| Forward P/E | 32.2x | 37.8x |
| P/S ratio | 13.0x | 14.9x |
Valuation metrics include sourcing from Financial Modeling Prep (FMP) and may differ from other data providers.
Which stock would I buy for 2027?
ASML and Marvell Technology are both great stocks to own for exposure to the artificial intelligence boom. The former is an attractive AI stock since it holds a legal monopoly over the EUV lithography machines needed to construct AI chips, as competitors have not been able to successfully replicate the technology at scale. However, if I had to choose between these two, I would invest in Marvell.
Not only did Marvell report 42% year-over-year revenue growth in its 2026 fiscal year (FY), in its Investor Day held on Oct. 6, management set a FY 2031 target of $70 billion to $90 billion in sales. That’s incredible growth compared to FY 2026’s $8.2 billion, and indicates the company is seeing strong customer demand for its AI solutions.
That’s where Marvell’s bid to acquire Lumentum comes in. Lumentum reported fiscal Q1 revenue of $1.3 billion on Nov. 2, which represents a jaw-dropping 137% year-over-year increase. Its optical connectivity offerings enable rapid data transmission, a critical feature for data-hungry AI systems.
Marvell’s acquisition caused its share price to fall, as Wall Street weighed the dilution risk of the all-stock deal. This creates an opportunity to pick up Marvell shares on the dip, as I believe Marvell’s addition of Lumentum makes the company stronger over the long run.
Source: www.fool.com
