ASML projects 25% revenue growth in 2023 as chip industry recovers

Dutch firm ASML manufactures one of the most important pieces of machinery needed to make the most advanced chips in the world. The US chip ban has left companies, including ASML, scrambling to figure out what the rules mean in practice.

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Dutch chip equipment manufacturer asml 2023 revenue is projected to boom as the semiconductor industry predicts that growth will pick up again in the second half of the year.

ASML is one of the world’s most important companies in the chip supply chain. It produces the machines needed to make the world’s most advanced chips.

For the fourth quarter of 2022, ASML’s net sales are set to rise more than 29% to 6.4 billion euros ($7 billion), it said on Wednesday. For the full year, net sales came in at EUR 21.1 billion, up 13% year-on-year growth. However, net income for the full year actually declined by more than 4% to 5.6 billion euros.

ASML forecasts an increase of more than 25% in its net sales for 2023 as compared to 2022.

“When we look at the state of the industry today, we … are not immune to the fear of recession or high inflation or high interest rates, that’s also clear. And then we see the impact of that in our customers’ business,” Peter Weinnick, CEO of ASML, told CNBC.

ASML’s machines are bought by companies like intel and TSMC, which actually manufactures the chips that go into end products like laptops or smartphones. Weinink said the list of chips belonging to consumer products is growing because the demand for such electronics “isn’t great.”

But he said ASML’s clients believe it will be “short-lived” and so they are not canceling orders.

“Most of our customers tell us they expect an improvement in the second half of this year,” Weinink said.

“If you take into account that the average time of our equipment is … let’s say one and a half to two years and when you look at the relatively low expectations of a possible downturn, then customers will definitely cancel any orders.” They’re not doing it – because they could find themselves at the back of the queue when it comes up again.”

Companies like TSMC and Intel are adding capacity globally, especially in the US and Europe as they try to bring chip manufacturing closer to home. TSMC ready to open two semiconductor plants in ArizonaFor example.

ASML caught in the geopolitical crosshairs

US launches sweeping export sanctions aim to cut china From major chips and semiconductor manufacturing equipment. ASML told US employees Resulting in discontinuing service to Chinese customers.

This month, Mark Rutte, the Prime Minister of the Netherlands, traveled to Washington to meet with US President Joe Biden. At this point, it is unclear whether the US is pushing for an outright ban on ASML shipping equipment to China.

Rutte told CNBC last week on the sidelines of the World Economic Forum in Davos, Switzerland, that he expected the issue to be resolved “in a few months, maybe even sooner.”

Rutte told CNBC, “I think we can get there in a way that it can be done amicably, including with countries that you don’t want to use high technology and defense systems.” want.”

For now, ASML can send older equipment called Deep Ultraviolet (DUV) lithography machines to China, but not much of its EUV system. ASML CEO Weinink said China accounted for about 15% of sales in 2022 and will remain at a “similar” amount this year.

Ultimately, he said that this situation has to be resolved by the governments.

“It’s not just between the Dutch and the Americans, it includes other European countries, it includes Asian countries, so it’s a complicated situation,” Weinink said.

“It’s up to them [governments], I just have to do what comes up.”

, CNBC’s Silvia Amaro contributed to this report.

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