Given that backdrop, one can ask whether another technology stock might surpass Palantir over a longer horizon. The thesis of this article is that ASML, a leader in semiconductor equipment, is better positioned to outpace Palantir over the next several years, thanks to its structural role in the chip supply chain, more stable demand drivers, and a valuation that has greater room to run. The next sections examine Palantir’s strengths and risks, then make the case for ASML as the long-haul outperformer.
Palantir’s Strengths & Risks
Palantir commands a strong presence in its niche. It has deep ties with defense and intelligence agencies, which gives it recurring, relatively stable contracts. Its software tools for data integration, analytics, and AI use cases have attracted both government and corporate clients. In 2025, Palantir’s U.S. commercial revenue leapt 93% year over year, a sign of its expanding reach in the private sector.
In Q2 2025, Palantir delivered earnings per share of $0.16, surpassing analysts’ estimates of $0.12. These results encouraged optimism around its ability to scale and support its high valuation.
Still, Palantir faces significant risks. Its valuation is already aggressive. Some analysts note the company trades at very high multiples relative to peers, leaving little margin for error.
Much of Palantir’s revenue depends on government contracts, which carry political and regulatory risks. A recent report flagged serious vulnerabilities in a battlefield communications prototype developed in partnership with Palantir, forcing the company to respond publicly.
Additionally, as Palantir expands into commercial domains, it must contend with strong competition from incumbents in AI, cloud, and analytics. Execution risk is real: if growth or margins stall, its lofty valuation could reprice downward. In sum, Palantir is a powerful benchmark, but one that carries high expectations and elevated exposure to both external and internal risks.
Candidate for Outperformance: ASML
ASML Holding is a critical supplier in the semiconductor ecosystem. The company builds photolithography machines, especially those for extreme ultraviolet (EUV) lithography, which are essential for manufacturing advanced chips. Because only very few firms can produce these machines, ASML holds a near-monopoly in this space.
The demand for advanced chips is projected to grow strongly over the next decade. ASML expects global semiconductor sales to exceed €1 trillion by 2030, growing at about 9 percent annually between 2025 and 2030. That growth is driven by AI, high-performance computing, and next-generation nodes.
In recent quarters, ASML has seen surging order books. In Q4 2024 it booked €7.09 billion in new orders, far above expectations, reflecting the strong pull from chipmakers pushing to secure equipment ahead of capacity constraints.
From a valuation standpoint, ASML trades at more moderate multiples compared to Palantir. Its role is more infrastructural than speculative. If the semiconductor cycle stays healthy, even modest growth in ASML could compound into strong shareholder returns over time.
That said, ASML is not without risk. Tariff and export restrictions have clouded its outlook. The company warned that it “may not achieve growth in 2026” if chipmakers delay investments amid uncertain trade policy. ASML’s net bookings also missed estimates in Q1 due to tariff pressures.
Another risk is cyclical downturns in the semiconductor industry. Demand for ASML’s most advanced systems may fluctuate with capital expenditure cycles at foundries. Some analysts caution that supply chain bottlenecks or weaker orders for High-NA EUV systems may pressure margins.
Nevertheless, ASML’s structural advantages, limited competition in critical tech, strong secular demand for advanced chips, and a more measured valuation, make it a strong candidate to outperform Palantir over a horizon of five to ten years, rather than chasing hypergrowth in the short term.
Supporting Benchmarks & Alternative Contenders
While ASML presents a strong case, other technology names often surface in debates about who might outpace Palantir. Two notable contenders are Meta Platforms and Snowflake.
Meta has invested heavily in AI and infrastructure. In 2025, Meta committed between $60 billion and $65 billion toward AI capex, signaling its intent to build next-generation compute and data platforms. Its valuation multiples are lower than many pure AI plays, giving room for upside if execution holds. (See the detailed capex plan announced by Meta)
Snowflake, a cloud data platform, has been gaining momentum as enterprises shift toward AI and data analytics. In 2025 it raised its full-year product revenue projection to $4.40 billion, above earlier guidance, thanks to increasing adoption of its AI features. It also saw its shares jump on strong demand for AI-oriented database tools.
Each alternative has strengths: Meta’s scale and resource base, Snowflake’s AI data positioning, and ASML’s infrastructure role. However, Meta faces higher business risk given its dependence on advertising and consumer behavior, while Snowflake must navigate fierce competition and heavy reliance on cloud growth. That makes ASML’s more stable foundation of hardware infrastructure a compelling benchmark.
Risks & What to Watch
The thesis that ASML may outperform Palantir hinges on a number of conditions. One major risk is a slowdown in semiconductor spend. If chipmakers delay purchases because of economic weakness or inventory overhang, ASML’s order pipeline could shrink.
Another vulnerability is export controls and trade restrictions, especially between the US, Europe, and China. ASML’s ability to sell its most advanced lithography tools depends on favorable regulation.
On Palantir’s side, weakness in defense spending, regulatory pressure on government contracts, or missteps in its entry into commercial markets would strengthen the case for ASML.
Key indicators to monitor include backlog growth at ASML, direction of chip capital expenditure budgets, gross margin trends, macro conditions in global tech demand, and regulatory news. These signals will help test whether the outperformance prediction remains plausible.
Conclusion & Investor Takeaways
Palantir is a powerful reference point in tech investing, but its aggressive valuation and contract concentration expose it to risk. ASML offers a more grounded alternative, tied closely to structural demand in semiconductor manufacturing, with fewer speculative dependencies.
Investors seeking long-term exposure to technology might consider ASML as a way to capture secular trends in AI and chip development, while monitoring industry cycles and policy risks. Over a multi-year horizon, ASML may well outpace Palantir, provided execution and external conditions align.
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