Dutch semiconductor equipment manufacturer ASML (ASML) released its earnings report on Wednesday (20th), with a sharp increase in second-quarter net profit due to record new orders, but ASML cut its full-year revenue growth forecast in half and revised it down to 10 %, highlighting the impact of fast delivery of machines.
ASML said net profit was 1.41 billion last quarterEUR($1.44 billion), up from $1.04 billion in the same period last yearEUR.Revenue was 5.43 billionEURalso well above the 4 billion a year agoEUR. ASML’s earnings fell short of analysts’ estimates, but revenue beat estimates.
ASML forecasts 3Q net sales of between 5.1 billion and 5.4 billionEURless than analysts’ estimate of 6.48 billionEUR. Shares of ASML tumbled 4.8% in intraday trading on Wednesday and are down regarding 32% this year.
Profits were impacted by higher costs and a delay in the recognition of revenue, as some systems were shipped to customers before they were fully tested in the Netherlands, ASML said.
In order to speed up the delivery, ASML began to skip the final test in its own factory last year, so that customers can obtain the machine faster, but ASML still needs to wait for the official approval of the customer before it can recognize the revenue.
ASML said that the revenue from rapid delivery equipment recognized next year is expected to increase from 1 billionEURto 2.8 billionEUR. ASML also said that due to the fast shipping plan, this year’s revenue growth forecast will be lowered to regarding 10%, which is not as good as the original estimate of 20%.
“While we still plan to deliver a record number of systems this year, supply chain disruptions have been more severe, causing customers to delay equipment start-up,” said ASML chief executive Peter Wennink. Net new orders for the quarter were $8.46 billionEURwrite an all-time high.
Dutch Foreign Minister Wopke Hoekstra confirmed last week that talks are underway with the U.S. government to stop ASML from selling chip-making equipment to China.
However, Wennink said earlier this year that it opposed a ban on sales of deep-ultraviolet (DUV) lithography equipment to Chinese customers because the technology for making such chips is mature. The data shows that the equipment sold by ASML to the Chinese market, whether used by Chinese companies or foreign companies, accounted for 14.7% of ASML’s total revenue last year.
