ASML EUV machine

ASML: Demand for Chip Tools Hits Record, Backlog Exceeds $38 Billion

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ASML on Wednesday posted record revenue and profits as demand for chip production equipment hit records despite slowdown of PC and smartphones sales. The company’s backlog for its products — including deep ultraviolet (DUV) lithography scanners and extreme ultraviolet (EUV) litho tools — now exceeds $38 billion as chipmakers continue to invest in wafer fab equipment (WFE). ASML continues to sell its DUV tools to Chinese customers. Furthermore, all current EUV customers have committed to High-NA EUV tools. 

Record Demand

ASML’s third quarter sales came in at €5.8 billion as it sold 80 new lithography systems as well as six used scanners, including 12 EUV tools (in line with Q2) as well as 74 DUV machines (down from 79 in Q2).

(Image credit: ASML)

The company’s profits reached €2.994 billion in the quarter, while its gross margins hit 51.8%. Some of TSMC clients prefer so-called fast shipments — a shipment process that omits some of the testing at ASML’s facilities and brings final testing and formal acceptance to the customer site — so some of the company’s Q3 2022 sales will be recognized in the following quarter(s).  

While demand for PC, smartphone, and consumer electronics chips is getting weaker, chipmakers expect sales of their products to start increasing in 2024 ~ 2025, which is when they are going to need new production capacity with installed tools. At present there are multiple fabs being built by such leading companies such as Intel, Micron, Samsung, and SK Hynix that will need equipment in the coming years. For ASML this meant record bookings of around €8.9 billion in the third quarter, of which €3.8 billion were EUV litho tools, including those with 0.33 numerical aperture as well as High NA systems with 0.55 numerical aperture.

(Image credit: ASML)

As of today, ASML’s backlog exceeds $38 billion (up from $33 billion in Q2), which includes well over 600 DUV scanners as well as well over 100 EUV scanners.  

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