ASML on Wednesday Posted Although sales of personal computers and smartphones slowed down, demand for semiconductor manufacturing equipment hit a record high, and sales and profits hit record highs. The company’s product backlog, which includes deep ultraviolet (DUV) lithography scanners and extreme ultraviolet (EUV) lithography tools, now exceeds $38 billion as chip makers continue to invest in wafer fab equipment (WFE). increase. ASML continues to sell his DUV tools to Chinese customers. Additionally, all his current EUV customers are working on high NA EUV tools.
record of demand
ASML’s third quarter sales were 6 including 80 new lithography systems and 12 EUV tools (same as Q2) and 74 DUV machines (down from 79 in Q2) of used scanners, resulting in €5.8 billion.
The company’s profit for the quarter reached €2,994 million, with a gross margin of 51.8%. Some TSMC clients prefer the so-called expedited shipping (a shipping process that skips some of the testing at ASML’s facility and brings final testing and formal approval to the customer site), so the company’s Q3 2022 A portion of the sales will be recognized in the following quarter. (seconds).
While demand for PCs, smartphones and consumer electronics chips is weakening, chip makers expect sales of their products to start increasing in 2024-2025. Multiple fabs are currently being built by major players such as Intel, Micron, Samsung and SK Hynix, which will require equipment in the coming years. For ASML, this represented a record order intake of around €8.9 billion in the third quarter, of which €3.8 billion was for his EUV litho tools, including a 0.33 numerical aperture device and a 0.55 numerical aperture high NA system.
As of today, ASML’s backlog is over $38 billion (up from $33 billion in Q2), which includes well over 600 DUV scanners and over 100 EUV scanners.
ASML Chief Financial Officer Roger Dassen said: “They’re really building capacity beyond 2023. And there’s still this element of technology sovereignty that we’ve been talking about. The fact that governments want to be more self-sufficient in semiconductor manufacturing. The trend is still very important, so I think it creates a situation where the majority of our customers are still pushing us to get the tools sooner or later.”
With a target production capacity of 375+ DUV machines and 60+ EUV machines in 2023, it will take several years for the company to deliver these tools.
ASML CEO Peter Wennink said: “For the full year, he expects revenues of €21.1 billion and gross margins approaching 50%.”
ASML continues to ship to China for now
Unlike its US WFE suppliers, ASML did not lower its Q4 guidance. This is because of U.S. sanctions on China’s semiconductor sector, which prohibits shipping U.S. chip-making technology to China without a special export license from the U.S. Department of Commerce.
ASML is based in the Netherlands and does not use many US designed or manufactured parts in its DUV tools. Therefore, most, if not all, DUV tools can be shipped to companies such as Semiconductor Manufacturing International, Inc. (SMIC). According to Hua Hong and Yangtze Memory Technology Co. (YMTC) Chief Financial Officer Roger Dassen,
“We are still in the process of evaluating [U.S. restrictions against China’s chip industry]said Dassen. […] we do whatever it takes to comply [the new U.S. export laws]. […] But the fact that we are a European company with limited US technology [our tools] Of course, it creates this situation whose direct impact on us is rather limited. Non-EUV Lithography He can continue to ship his tools from Europe to China. ”
ASML was unable to ship the EUV scanner to a Chinese customer due to the Wassenaar Arrangement, but cannot ship to China as it uses a Cymer light source that is designed and manufactured in the USA. ASML has no plans to ship Twinscan NXE scanners to customers in China (which is why a potential EUV shipment to China was not included in the guidance) and the US crackdown on China’s semiconductor industry against ASML. Impact is expected to be limited. The company has not updated its forecasts for the fourth quarter and 2022.
On the other hand, ASML acknowledges that there may be an indirect impact on sales of DUV tools to Chinese customers. Fabs require different types of machines to operate, so if a customer doesn’t get the tools from Applied Materials or KLA, ASML’s lithography doesn’t need his scanner and may cancel the order. Companies like SMIC and YMTC have billions of dollars in government subsidies and continue to buy new litho tools whenever possible, replacing used American tools and parts made for American equipment. This is somewhat unlikely as we try to source it on the market.
And even if Chinese customers stopped buying lithography tools from ASML, demand would still outstrip supply and the backlog would be so large that sales to other customers would more than offset sales to Chinese companies. will be of
All EUV customers are working on high NA EUV
Even more good news for ASML this quarter is the reorder of the first commercial high NA scanner, the Twinscan EXE:5200. At least one of the orders was from a current EUV customer of his who had never ordered this tool before. This means that all companies using (or planning to use) 0.33 numerical aperture extreme ultraviolet lithography will eventually move to next-generation EUV lithography with 0.33 numerical aperture. 0.55NA.
The company has previously said that three Logic and two Memory customers have ordered high-NA scanners, and while ASML has not named its 0.55 NA EUV clients, Intel, Samsung Foundry, and I can guess that you mean TSMC (Logic). So are Samsung and SK Hynix (memory). ASML hasn’t disclosed the name of its most recent high-NA EUV customer for obvious reasons, but it’s reasonable to assume that Micron ordered its first high-NA scanner in the third quarter.
Micron is currently building two state-of-the-art memory fabs in the US (Utah and New York) and plans to start ramping up DRAM production sometime between 2025 and 2026. Initially both fabs will use the Twinscan EXE 0.33 EUV tool, but eventually Micron will need something more advanced, so a 0.55 EUV scanner. Apparently the company is already preparing for the next generation.
Micron has yet to comment on its high-NA EUV efforts, but there is good reason to believe that the company is looking forward to ASML’s next-generation high-NA EUV production tools.
Overview
Demand for logic and memory chips for PCs, smartphones and consumer electronics has fallen in recent months and is unlikely to recover in the next two or three quarters, but chip makers continue to invest in their fabs. and brings funding to ASML. Demand for WFE is so high that ASML’s advanced equipment backlog grew to $38 billion in Q3, or $5 billion in just one quarter.
While US companies currently require a special export license from the US DoC to sell wafer fab equipment to Chinese customers, ASML is allowing its DUV scanners to be exported to the People’s Republic without any restrictions. I think we can. It remains to be seen whether US sanctions against China’s semiconductor industry will indirectly hurt his ASML, but demand for the company’s tools is so strong that it will completely lose Chinese customers for at least a few years. maybe not even.
According to ASML, major manufacturers of logic and memory chips currently using EUV scanners priced at $160-170 per unit will adopt more advanced high-NA EUV machines in the future.
