ASML Holding (ASML) 20 Apr 222022 Q1 Earnings call transcript

Thank you for standing by. Welcome to the ASML Q1 2022 Financial Results Call. Throughout today’s introduction, all participants will be on a listen-only mode. After ASML’s introduction, there will be an opportunity to ask questions. [Operator Instructions] I would now like to turn the conference call over to Mr. Miller. Skip sir. ahead, go Please

right. Thank Miller, This Skip Welcome, you, President of operator. Vice ASML. everyone. Investor is All Relations at

today call ASML's will in transcript call XXXX order will are be internet call quarter is results. management’s are that our taken This also the The a on A received. live XX of on our Peter first of me and this call length subject is at broadcast and Dassen. CFO, minutes, ASML's call the today's remarks be the The Wennink; website asml.com. the shortly call. will of Roger this available Joining CEO, being opening over the and of following they replay of conclusion be questions

caution laws. begin, the that involve forward-looking during forward I’d by management will to securities conference within material looking and statements we federal made These like this the comments call include uncertainties. statements risks of listeners meaning Before

discussion and of in today’s over For XX-F documents for contained that, to with you our introduction. found on and presentation Annual in the release like website the With Securities Report as statement risk on review turn other ASML’s encourage brief a the call Form asml.com Harbor press Exchange and Safe factors, Commission. a and I at I'd filed to to Wennink Peter

and and and everyone, on results Welcome, you I Roger safe. provide for are of the as for begin before and thank quarter the Skip. family and I commentary overview conference and XXXX, to like call. Q&A And first XXXX you, hope first healthy Thank an still quarters. I joining your on performance, quarter would some you us our session, some we if of all some with outlook. business added environment the on well on the the current Roger, will financial our And of comments introduction will the And provide you additional start as short-term with comments first our quarter complete XXXX future will? with view Roger our business review outlook. a coming

to margin €X.X be will of €XXX in everyone. in Welcome, came net EUV systems from systems €XXX QX high than of on quarter first Peter. sales expenses, the came X billion, Installed planned second €X.XX. the guided. in expenses €XXX and Net balanced an system at quarter still XX% of accomplishments below came is logic which revenue which and fund shipped year. resulting the at of sales you, at for will We guidance operating quarter. came in billion, for XXXX. the expect quarter €X.X million. as guidance. sales Net around guidance, move from was sales and Base €XXX R&D the XX% was provide in was sales million, XX.X% as EPS XX% Gross to was expenses three rates for recognized and and €X.X lower of at billion, of end We quarter QX. and Net I million income representing in between at XX.X%. million, this of Management nicely guidance at SG&A R&D the On review memory. the in the first at financial Thank quarter then

€X.X to short-term investments Turning the We a equivalents cash, at balance quarter and billion. sheet. cash the of first ended with level

came systems billion €X.X billion, net NA at in Moving EUV X.XX for NA system, including order ExeXXXX. €X.X book, system to multiple X.XX EUV bookings the and QX

second quarter and by for our I With of this to the intake €X.X the of memory net order like that, the XXXX. XX%. XX% logic bookings the continued system to accounting for Another Total of strong billion very bookings turn DPV quarter, mature and demand driven would advanced strong reflecting nodes. expectations was remaining for with

a We at be total QX revenue net more shipments million to QX excludes of QX. of net expect as This €X.X the delayed of end around for of €XXX the €X.X QX than end and billion result between billion. sales fast at

energy million base is sales We €XXX by not see expected year and €XXX to due million. EUV in come EUV our is margin impacted increased rising on due to may and volume immune pressure by help for gross Energy Gross expect pressure DPV, also including costs. costs, flight competition labor in billion. changing we and last is supply mix, increased the rising costs energy talent. installed margins cost fuel to X% around to pressure at DPV secure a also impact R&D the on cost to QX both to There engineers expenses and to is appropriate from be impact are Transportation be Relative a cost QX for to have translate lower parts. job global quarter. XX% for these to increasing margin In expected current this cost to is quarter, the higher XX%. expect The margin the ASP, renewable which for €X.X positive to limit continued management expect and how related it there address expected impacts. due be full for additional are for rising as and on material routes. is we around and we costs roughly around between We're QX increases, XXXX. tight costs to contracts SG&A components the offset to We environment, market chain fees higher in year. Costs clearly

of half closer by second base as to margin installed driven and margin EUV the well as improved gross summary, primarily In to gross currently expect the from higher XX%, expected we around DPV XX% be the margins with of volume strong year. business. expect be year for will We

a total effective I that, as our to XXXX would amount for program. tax shares to be QX call of to billion back acquired Peter. of XX% current turn estimated is around X.X XX%. expected like In €X.X Our annualized With rate million the between over ASML XXXX, part and

you, Thank Roger.

as the between highlighted, As with has and revenue logic Roger guided system in and revenue profitability balance came memory. quarter for

step-up We sales revenue QX in fast will QX expect recognized. be as in in from shipments a

chain to supply get are a still means as to soon continue as customers systems utilize as we challenges shipments will to present, fast While possible.

Although macroeconomic remain the the current environment we uncertainty, fundamental drivers growth believe creates intact.

demand We continue market portfolio. and across mature unprecedented demand advanced our product nodes, all to from entire see across customer segments both driving

maximum capacity expect We to exceed into supply next are demand at running year. well and

revenue, XX% of view year around therefore, Our remains XXXX. full with over growth of the year-on-year unchanged

shipment due to a last growth for of out year delayed value result As sales not this fast XXXX. does a this systems XX% into the mentioned of which number revenue will quarter, shipments, include full in

XX expected significant QX, translates systems systems. to dry as UV some year. For in as to still revenue deep This growth we fast our both be plan continued systems we and In inspection business, around And immersion shipments to revenue of deferred €X.X ship expect an business, including and to system metrology expect for billion we applications year. EUV this a and number our systems, on to expect systems, demand this well XXXX. do in around as of we these

which growth segments, as digital green see we market These a growing includes in In advanced segments infrastructure, and automotive sensors. mature energy power to the drivers analog, systems nodes, demand support part market applications. deep such of addition and secular supporting UV for of

of expect system for We non-EUV growth revenue over XX% revenue.

productivity In Base add taken times, For with upgrades. scale a very of types continue service the ability hardware-intensive high available wafer for dictate methods to revenue Therefore, look time fab these be continue some upgrades including are system utilization, of to off-line Management base install Installed these systems installed require these will business, Customers capacity, the will installation. upgrades. to and of their to to systems. all growing at

require As around previous quarters, less mentioned productivity be is been XXXX we revenue and packages. install way year-on-year. fabs. our installed up now currently wafer have XX% These the installed quickest customer system in to to of downtime to software base expect in most add We capacity upgrades

market Looking segments at XXXX. the in

of to quarter. XX% on view similar High-NA to have room up Veldhoven. be On in orders last QX. year-on-year, year-on-year. Our system logic XX% revenue around in memory than is more High-NA and good up integration be system system EUV, to EXEXXXX we're first We our making system the started multiple for progress. our clean currently new expect And received We in revenue we still growth the

We also April. additional EXEXXXX received month, this orders

over the and performance next next talked With step bookings, market is Logic provide billion this lithography is these the we demand. year a system trends space and providing now secular reflected High-NA all-time backlog Day Investor is are with two the drivers several significant orders high. in around we three EXEXXXX bookings for broadening strong €XX application Memory resulting The The will year at and that about The quarters, our model global productivity. and for an High-NA beyond of and demand have in last the past future customers. growth ASML's

We from expected impact in the the strong continue a With announcements next this for a years of countries multiple pursuing to coming demand global are going customers number new have continue supply now exceed investments to sovereignty, in intake fabs on announced medium-term positive as technological demand. year. are order the expect seeing will These to well into also we trend. support of

during actively to talked at of partners are demand XXXX. we to is XXX customer meet ASML an capacity supply EUV, current ramp output systems our and deep as exceeding chain deliver year. communicated this future NA unprecedented Day the around capability Investor UV But last capacity, As demand over is its time, to XX by that and about planning systems add capacity expected X.XX

output As and an need least our longer mentioned stronger to to demand at in that a meet expected is we support by market level quarter, to increase order this the last double industry XXXX. to further see beyond

adding around systems. EUV of XXXX and investigating our we're systems by more XXX UV and capacity deep feasibility increasing to NA goal the X.XX annual With of the capacity, XX

feel that therefore with to partners and with and goal the to mind be For discussed XX a what we not medium output currently deep towards in We plan. increase in around QX discussing it immersion capacity with And chain a opportunity. dry. to but is that, weighting also our questions. supply It systems we're should our for and your clearly chain both capacity We're exciting the and also supply partners dry, them maximum High-NA to recently X.XX markets our also capacity back our planning quarters, in request. of UV, the increases with secure long-term Bear be a EUV to our may period be and time asked heavier this we'd term. scenarios the frame. to in dynamic, goal translates expect the our capital complete an Once this beyond revisit opportunities come XXXX analysis, plan our growth to update we feasibility to confirmation We with only of coming take growth our our confidence XXXX. on in a industry, provide challenging in we final happy

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been plans, side, plans expansion relative on putting when the ask kind prior your So, expansion about model, of question high capacity to like looks I specifically to look it higher XXXX your in I capacity. manufacturing the on like a wanted had at end of XX% you a DUV the

should you that maybe that? capacity updated or are kind the to with how of about looking range, So, increase softer we think plans,

of result of that's is the Joe, we Markets a question. a two of a when Yes. to have couple Basically, before. we the number good remember, did is September – One things. Capital prepared months XXX you this Day,

year, last at about it's intelligence, looking compared as you're -- think I So, that's market a to year old.

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talk analog. and sensors, sensors, And demand And lower across visibility look of semiconductors the been that's last the current basically capacity say, those say, when our, progressed of in upside that market talk mature type that higher so. over you look and we about it's level the when the So, end, if would have demand the number because power let's at the is especially or now non-optical a one XX lines. months at from are insights I Asia. optical insights installed you the are ICs, and plus has increased, about is especially you

microcontrollers. every and a You almost very the upside when it look area, demand really demand, those which driven by customers, range, a talking talk and the our IoT of the a semiconductors, for at opportunities. significant to wide is at we about is type of market mature There type growth just we numbers increase it's industrial look in

decreased Now the need has and the high-power for you has to the device's fact actually the that is is, the Number for impact be frequency see in silicon efficient, that's also It actually speed, clock order a usage. on two but more applications. PC to compute energy the energy see significant with more do that one. we

impact an the has also it on However, performance.

So, you silicon by transistors, that millimeters. do how square compensate you add more

confirmed instance, increase waveguides, demand also helps So, then an see to And we see growing. been customers. has on see customers the fab medium die that top capacity incentive demand and out build equipment. what technological Then That's for many for the our goggles we sizes applications, very are see we an in non-semi with sovereignty also program clearly that, which lithography in we actually basically for demand, of term is litho quicker. leading-edge

So, also in are lead increased, capacity most visibility time say, market and customers of one time. all, a is all order the that our issue very I I out, – would lead finding has important the think the important lead -- thing, course, time the is that the our but

actually XXXX much customers timeframe. capacity now So, our longer us into, way sharing let's with XXXX, say, which improvement the plans, extend

have numbers So which talking together the all the confidence that XXX that numbers the UV gives that we're about, a basis. are numbers and XX deep actually EUV

detail, quarters. of we once actually next feasibility our of think is confirmation be share happen lot a chain Now supply on. will would like that, And the to the from can we request couple that get we the in with partners that you executed

think So time can give to you we basically, bit some give in that spend I we Market QX, you details, which what want reason I why I is can want just but a to Day, it. where then the we you more on more update details on a some said, Capital to

that also, then Markets the to are the Joe, were because buffer was if also XXX. indicated Day, UV the course, because a buffer, worldwide we took of at specifically did looking -- right you the in have And market lower at you our in on question deep And demand, on there we the we Capital of then, a that that XXX your capacity share than in units stage.

At Investor that what that Capital will the because demand going the XXXX. the our the Day, we buffer to, to of we're into expectations bit there, we're that how you I terms for So capacity the will say, think, Peter And I that relate obviously was think also looking that we Peter is that's on then talking typically discuss we that And for in that would at the to. Day, indication on in articulate XXXX. capacity. Markets an will see about will Investor referring a buffer see you're foresee demand. I Day that's give There, something referring of you to

helpful really details. Thanks. That's some

you upside? follow-up. what a on I Just the wondering EUV puts was takes maybe this quick ASP give just as the quarter, and if the could us drove

because, it's these for make based has it's sudden the on EUV -- units a big the ASP. estimates you ASP corrections in primarily sales, you quarter, as this we that on you three course, as has you with that course, have all only of of on had that a But based Joe, VPA get risen And accounting, that specific. know, not estimates Yes. nothing It's revisions the dramatically. of not then, accounting, impact VPA. And and if then of for

in think, to X,XXX your forward. as take still the for think, models, the I it's prudent ASP million I XXX going

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Hi, tools taking question. I at It only backlog per quarter DUV XX there, was some sort around the in yes, for so, for And, of XXX DUV If guys. it around tools your like or shipping do while backlog you're tools. around looks just DUV thanks the for sitting simple is probably only. just math,

DUV while? a -- time of a for perfect where of is capacity, does -- kind that, you where about DUV reality to backlog nine that or world, would mean like extended tool than as two will today to you that And go in So that would to is be increase there months how think for waiting you quite a the new your time years? to waiting back back sort related it more of go

questions, quite the Yes. One, backlog DPV significant. Rob. yes, good is Two

we're our units out as the all the bit mentioned, it’s XX have more to actually for deep reason that, although UV year units, pulling around at next the little process are XXX; stops we basically that increase yes, shipping increasing capability. more. efficiency. simple to time are XXX while we not we that, -- throughout shipments shipment mentioned I be we're and doing mean, in in will But but realize year this a able you we cycle You reduction, we're

go So, that up. will number I think

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of the to going now. now, order If deep you would the you the completely purchase simple the -- PO UV in that for and lead-time half is a lead-time. reason want come year, you're second be because tool capacity It's next irrelevant

to but need back months able the the we year you this XX%, time, So, case. can ultimately currently another only which the to, deep in so get lead-time. and that means XX%, is by this nine let's say, two less indeed we This also XX% we will build PO in probably capacity. only in to to deep build go at to moment demand. be this UV, take UV ship is capacity Yes, we why years demand at see least order that Then think out let's that, more, yes, of

on that's not of driven So, the is our anything that indeed, by that comes beyond lead-time, capacity And matter maximum time. that, a only capacity. anything

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that will the you'll suppliers we're up inflation more some guys. of delivery? top that that. guys different they about pricing from the to guarantees pricing. for suppliers a I'm of want we that fact think follow-up And in going quick of various you will seeing take guarantee want higher build But Just kind from prepayments look the to assuming may tools capacity drivers should cost so individual for from just order you on

Yes.

always is base case I supply the add been to think you the in -- need it's to when this capacity. go

there's with. grow. which the will have that's that just our all double will we're think need before the I we very -- agree pretty them remarks, story for a they that industry said Like this of customers more of in more prepared the case, industry decade. And if going this end than capacity, I convincing chance to a think good the we that the

But not to that to just run our our it's we're a think that we've the suppliers, and people if that's help the matter into That financial at that might a that, might like all, major in just we own not to help ceiling or certain I'm of take done excluding issue. but are the not execute make a enough have going sometimes Now, risk, step generally, supplier with that is past, financial big that and in I faster. might to suppliers CapEx. a pay sure And away happen. means

going short-term on the think cost So, really seen to increases. major that we've think increase value And I be are We pricing. cost do issue. pricing, a don't I that's

going the So, over which wafers a that, that it be is the are increase. coming customers doing. of go said not cost of our plus to value will we cost up, what also out function were of Having time just

out, means also customers. forward, will definitely next reflected. the run volume mean that not short-term, XX agreements I will to our volume different the agreements we charge going but to prices it So, new lead pricing value we also be that that over purchase connected, XX purchase to have months will all when that's

Got it. a Thanks lot.

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Thanks I've questions. for afternoon. taking got question. two quick good Yes, my

global context a an rate, about about. and which but believer, billion the to I'm in €XXX in you're demand that's growth assumptions, question macroenvironment what researching, maybe billion sort about aggressive what but you've of a million don't to like when better thinking million the worries would a baked the numbers, you capacity understand to intensity WFE, to to WFE range XXXX understand the reverse get bit to plus your to related etcetera, like guided And wanted XXXX because engineer to you of $XXX all, numbers First I in just roughly €XXX I get in of understand especially semiconductor we in that's the what's if a I range. just for, know talk I that, of just to make WFE plan. plus, etcetera. I current when $XXX

right So on And not, quick a way if the to it? not? think that's understand got I about to end. just And why high I've wanted if follow up

there's lot only I debt that to comment we we think make say, you basically is and XXXX the would to believe we think also way XXXX. I about of Well, When -- in I But everything what think the it. the a you is said right on by for secular be very build we strong to do this with capacity on, our want customers. with what our intent going focus is a the growth

So billion they even latest data, if you €X the look XXXX. for at Gartner actually, are above

that why industry that gobble our it's And in definitely important capacity, half. all And up so of is do we're second decade. But will -- that capacity -- capacity doesn't for we because the mean you second by is by that, there the it XXXX. capacity so, XXXX would the it it need not will that add is have the lead half that this the saying It if semiconductor time. you

or because be start a we You might it need need need And to definitely 'XX XXXX. it couple might It your 'XX takes or don't years. now that that point. to 'XX of in in

if it's €X.X and at trillion. above latest guided you just I – which Now if then you look would is date, the think say,

said. numbers, close If you you at WFE to coming you apply you're what historical just that look your pretty

going is. I'm industry And to what investment company XXXX semiconductor an telling certain. needed. industry you it in not number the the what reason of it is But for the the of absolutely to growth growth be, and higher, of This this the revenue is is our be that's customers. the So going but why. it's the That's is

correct a yourself as So, XXXX pin you I think your of don't is line year. or onto reasoning

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second my on is question So, High-NA.

the of CMD, sort us X telling XXXX. So or units, the cautiously were take, time give about of at you

that Now you're for saying capacity you're midterm. thinking XX building about units

I mean A, or So, beyond give you sense just far And taking given quarter? the about than for linearity so thinking I from of XXXX. sort mean many in are after? units you the in little X support have you is a a it of trajectory? could, taking units the if get or I bit XX, is how X really it booked you what's already customers take, more of XXXX, or your off it I what's XXXX, give us wondered take that the off

Good question, Didier.

that that. we we're how to look to those into exactly installation that, a Capital the is going what you recognition Markets process, in stage X the take do at X, high And Also to 'XX, is market that exactly into reason revenue at is we but And unclear that think how the that also I how for that different Day, this and -- for was know the recall lower systems. as just said how did the in said might revenue. the the we market don't bit the also take 'XX, scenario. how X there work we scenario, like is reason we consideration for will we because the in have models how

we're why reason five we're expect looking you we terms we might that we're we a so in that a Clearly, That's we five in to of The then be like, we revenue. 'XX able what So on were X of is the ship that's what north shipments in why and those of XXXX. said XX, for pretty number take we the conservative going pretty conservative, XXXX. looking if estimate number – conservative. at be to of for might

shipments also medium that's expected more XX, in the And we set why term. we XXXX. for said So

we XXXX, bit just demand we mean for XXXX not will number very research But frame. quarter where that of have I That's the initially this the will in be could so medium be there. we order clear after XXXX, buildup purposes. for in on little progressing term also last cater XX is quarter. the XXXX time be now So, coming that in think the the is coming which of as have a also nicely, necessary to you, we used mentioned XXXX book the tool, the and to orders

our in the nicely up is building So there line book and with expectations. order

Thank you Crystal so clear. much.

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Peter, I outlook follow the Yes, your for macro to FY been hi. taking seems them. has pretty question. three had my months, on question. XXXX last up two of like in the Thanks just much stable. It

still on You has looks your like through XXXX, worried it macro recession. of tons but forecast, actually supply about the be curious, -- and grown. Kind it's market seems demand to based

do somewhere and positive curious, industry industry investors or of too do or So the in are negative, think too the I'm you kind between? truth semi semi of you think cap is

minds always and Well, I'm with I've I got and the it to read always of the wrong. years, tried the company XX investors,

ask don't question. So me that

that the it's large they're semiconductors but of last And just week. And I I that's the I executive a company, that can told to only no, are that them customers industrial read but an days. And the see read happening large And actually, the only So, very -- to very before is to think underestimated, going significantly mean, market-wise, I we seeing the buying geography-wise, and where and that, let's currently so it in places the industry. the tried conglomerate, washing widespread minds, mention we it's machines width industrial -- not minds, with modules. have that I met our to is, demand. rip issue don't me talk many from it's say, these demand a place put this we're the today. in comes out away. go anecdote, the is think Technology-wise, a so of that they

that -- to say, used honest, like you I -- being a are everywhere. an XX, think by XX-year I got is everywhere. happens and semiconductor is type it's be it before, But, old could anecdote. this year. is customers is XX, don't said, and it that and that’s It's Now, that technology now said UV systems applications. I is fluke, real, I currently IoT deep our think XXX demanding, I think It it driven all

can I'm happy Now XX% if do we this that, year. pretty of

also will next that grow year. Now

because ship ship target, year, the than putting systems. to actually stops systems we're UV all more we will out pulling XXXX We XXX and more then next that that had deep in

capacity. XX%, above could demand XXX, still down which from is another the Now maximum go our yes,

of too into we're significantly looking and data We'll big points what base, this to of if just know. we no And is I And just market a short weakens, manufacturing see the next our don't whether signs semiconductor zero. capacity. me macroeconomics demand our any data year. wait in the do, customer have demand I'm even tell year see. optimistic. at currently, and you and the capacity that point there's will points the between So a and just weakening But gap

a helpful, Peter. then quick Super it. follow-up. Got And

sales, there can the you a is also a buying if do for high actually into way and point, process it's when think you vantage the two the From You articulated edge end helpful. demand, or record segment been the look I at demand for quarters. is technologies. be thought trailing China it last how strong for And true there see China would your

XX% year, I growth, In fact, faster a Krish, to in at see what world. China the of the for which company. rest of we're for about don't pace than general that expecting moving we think this the similar Also is rest the is China

such systems high in that So, we think as in is a saw China had China EV total the particular, sales QX for three because, The percentage you the only I in know, mix. line. in is you fact

So, total of so But itself anomaly as as in an percentage rectify that's will course that that, China a the sales of result of year. a think high. was the the the I

to and -- we're the believe rest we answer base. It's question And China used. as expecting they're capacity used for yes, being an to adding XX% So, the do is of still just your domestic being grow then what your as manufacturing. in customer to terms of that question,

piling lithography like using-- tools, not they're it's up there really So,

based entire see just now. we of numbers Yes. can is base utilization on it the logic as and the across It's our machines installed high never that been as And is memory.

their stockpiling hands mature shortage look desperately So, on anything our the are machines, are semiconductors, if they they'll get the that you type people semiconductors, they're trying anything. don't of stockpiling which -- stockpiling stockpiling not when to I and they think are at fact

next that's of out. capacity being big wafer of what hey, not end I'm adding our we out sold I'm So they're as sold the customers XXXX, and matter fact, wavers the the -- I've all -- until a told out And that year, it's of sold Chinese used. see one us, XXXX. XXXX, customers,

Thanks Got Roger. it, it. helpful. Peter and got Very

second Suisse. Adithya from -- Credit our question comes go of line one from ahead, of the And next Please line Thank open. of the you. comes apologies, is Metuku your line

Yes, gents thanks and good afternoon for questions. taking my

Firstly, there. again, just to Krish's question follow-up on

next units investor cut going be But next happen for And give games playing of High-NA all year, would year really your wondered go to in a if you for us your need we're next you, see on war lead-times, you saw for you that are these units just backlog for give see this you at if supposedly? And what that, ship cetera? modeling unlikely any you. XXX next the the I around if some in have around cut -- around your given super kind the that DUV color to as to Thank tool next view, the you would year could happen look in down. et for to the and to when is, recession. orders -- demand orders. EUV you decline, My side, helpful investors. customers what tools could us demand to decline really quarter demand figure consensus You you're can the even If would scenario customers orders secondly, view concerns given to year, DUV say consensus year for you

doing stops, people, out we're basically only year, maximum chain. Well, like – let's that going what I think say, will to overtime, over in next happen? XXX all capacity, we're the If be because do us, supply I said, hiring the which not There's could whatever. we it's I be our particularly pulling absolute mean, would it's

So that's where we want to go, yes.

Now demand year units. to what for is next needs to go the XXX for happen demand that down,

you So, XX% your you hit of our And XX% capacity, lose to then our capacity. demand. to maximum need

collapses let's can whereby Now crazy all it's with of we when say, shipped the be of And year. world when demand scenarios and we'll horror all deal a disaster. But macroeconomic we this than to a to are XX% well the significant there, we kinds slowdown, dream it up out more course, to things -- such curve. happen, what still then it's we're of needs XX% for, shipping take

I horror don't that's I know, So kind the But you not the the I'm world. better guidance the look yes, that suited on asked no. people do And all the of scenarios, at to way question, but probably that.

away either. there me, he got at I've but Whatever, in looking just was not

question a try orders, Adi. non-answer So, your you High-NA and I the on will to give

XXXX, three share. and did we That's orders multiple that's the these customers for So, an really We've system. said disclose for the and customers, R&D High-NA orders orders have that XXXX, memory we've also have from X we that we what and logic system. we for XXXX have indicated two we also can

Our a customers for as of not do the reasons, to want intake host order for to for system. High-NA the commercial specific be

So we labeling to that's why to the this stick at multiple.

clear. very That's Understood.

number. all there revenue clarification be those a that of Just recognize revenue not you Will so will shipments, on quick on be different? Is tools? Will some that XXX that recognized?

UV that upon deep and recognized systems These are shipment. generally

revenue, bit push shipments we're it's the a that's on revenue to XXX-ish So, trying to, like I shipments. -- I think higher which said,

shipments next of about think bit output all the of a between in you revenue terms and ship, of year, be likelihood, if fast talk stage, mean I you're small. balance Adi, I So should impact to on a if year, you that right? talk next very in see about delta fast the going at

Thank Understood. you.

question our C.J. Please ahead. from you. Muse line at Evercore comes next the go of ISI. Thank And

line is Your open.

morning. sounds taking pulling the question. High-NA or Good expectations afternoon. first guess sooner. in Yeah, Good have Thanks I greater you're certainly like question, it for

given we're then think supply see could DUV curious, ramping for the customer low optics on X-nanometer? And are as NA your constraints side supply evolving? conversations question of so, and And how high-volume I you part particularly do seeing the early on And you second guess EUV? how the are as the in manufacturing High-NAs, particular, we insertion

Yes.

machine. think you That case that's I to sooner. the mean, I a supply of It's issue. -- built. be needs different Generally, sort like not it's chain out, different mean, pointed I modules. a it's High-NA, it's because

doesn't which lot to on and a room according So executing sooner. this focused plan, us do is give to really of more

really we shipment shipment. the And XX%, I actually the hasn't linked is Roger chain about changed have all for because very plan the plan. it's in So revenue XX%. always our that just between capability of that. But shipment to to much, insertion, much recognition talked and supply think it HVM But difference the

the I likely be still going think, to that's very case. what it's

produced that, HVM a well first be said having XXXX, XXXX But being see of as X-nanometer the a is you it of that think the Now probably capability. could first devices that chips very kind in XXXX time I the set frame. show

just quick Very helpful. And follow-up. then, a

walk As COGS you you contemplate both us impact kind your OpEx? the capacity to the cost additions, through of can and structure,

that CapEx. I I invest a especially, and in us in But, chain mean, they think, to need our we'll Yes, -- need supply yes, think, we QX detail. -- chain, in the we to and do supply I bit more

for think higher on suppliers, course, I CapEx I they, mean, But, And of CapEx. in it's for a Now, need is cost us not volume. our the major CapEx of goods. issue our

think cost, don't expect or would I currently, a on Roger? big the impact it's I and early, margins So a bit

on that QX back XX% to point, We'll But that in little to expect we a bit to No, gross exactly, I we XXXX. C.J. more. XX% talk margin come when the expectation for gave Peter's impact a wouldn't significant for

in it think, that I still be will ballpark.

you. Thank

our And Aleksander of go the you. Peterc Thank ahead. from question Societe Generale. line comes Please next of

Your line is open.

demand demand times. the deep XXXX, unconstrained capacity expansion lead and for you XXX what industry on you of that bit XX like EUV by afternoon, just question. and offer Good to numbers these or Hi. and us be at, reasonable for back an estimate gave a briefly something the what between will the need XXXX? and looking equilibrium Yes. thanks of UV. Is needs terms come your you're Is I'd to the so to that get more

is in in you come words, and going possible. say, the So that that should be 'yes, that caveat or question. to too kind Is other revenue That's back difficult you get too this It's any suppliers optimistic have follow-up. we this there.' of quick to And then number and a my if way? to and drive your is I become to first guidance, will

what going needed rest to for available the probably for But we time. feel I that of I XXXX is decade. be the the the it's to have answer to capacity think, -- third Alex, basically question in actually

mean, really could It next this Now, XXXX. don't XXXX. in is about if need could reason, of ship, the can be see It today that happen, different know this the definitely discuss it for today. as for would be you a but result. is a But If could XXXX this then this capacity -- We know that. QX driven see we market we scenarios, would where see we to couple you year if could I in happens, be that that demand that really it's is would where lower. it it's We are higher, we but would result. show could which whatever going something happens, by don't see yet, that the how we buildup. in that same see the the and it still is we to same actually -- by be demand we that would you

definitely the our given that the us. So, needed would case, do let's XXXX don't be XXX to going but for brings what saying, DPV the XX unconstrained it. be it's crossed keep second We for definitely of have will could we are the it, the well, we that we know decade our see but and that customers. there half it's case, demand EUV, the on need not fingers we whether and capacity of XXXX this we growth And if

of now. a not multiple customers And get that clear. you two customers, from XD DRAM quick Could XD on you just very that's That's DRAM in clear branded actually the now just but indication light on a now just orders of on the follow-up DRAM, your one Okay. happening we saw timing number later? and about, potential XXXX share thoughts that is being

on that in that last their at public demonstrated point, EUV XX roadmap. the Well, are customers that clear that play EUV Samsung a we And to latest, half clearly next High-NA data it's conference was and their was they was think know in roadmap there, and actually, where and XD It clear public XX very November our the and has this is a than to particularly in hit for that second go this It times, of think to be They year, is, X our an years. is whatever I the couple to option. role I nanometers. made going to High-NA it less also is customers an of about their a That's this was option. need order us in X that get way, We think is could to DRAM I said that because we've are telling EUV important what indicated. not know there. roadmap we point XXXX. even what nanometers of somewhere and DRAM, But and in telling talked They a decade. they of X-nanometer

what what's always on that's So, That's roadmap stick the be That's XD in will telling on important are that's what but us It's we combination. to it also customers memory. our conjunction that our Could what's by. a driving go DRAM? with -- and us. possible,

much. very you Thank

Thank you.

comes the Please Our at question line of your Street New Rolf next from Bulk line Research. is open. go ahead,

component strong, very billion. And your you it quarter order capacity for close in memory and had order next, orders EUV on what primarily additions? a and you I long-term DRAM? Yes, again a is the €X.X or talk large The I added NAND thank taking is for my is was High-NA this question also business. that question. of memory capacity about for And can wondering, intake was to driving or this is being flow year

in the think largely these utilization it's in high. of mean, is very memory capacity additions I memory our the current for said demand. earlier, I like I very, capacity Yes, are machines space

even we the ever. say So, it's point highest

growth need bit for XX% you expected to high-teens, a this there's year, if capacity. add number just So,

forget, in will add some -- capacity. But that's bulk bid technology don't it will EUV into translated you EUV, the because there there will just with of HVM High-NA, not you're capacity. think of it seeing so is, I to DRAM. now also be yes, So And immediately is what is an

vast at it, current utilization understand for which of most majority additions, the of I So, when is capacity the I look fully it rates.

Thank business margins you please an service could you. on a the I business? versus stand And on as an basis? the And on averages? corporate where do do year? is us follow-up, give also, you if rate And expect EUV How large you growth this unrelated today your run may, gross what update

Yes.

And talked billion gross the service we EUV €X past. the the year. business about margin, this in So, margin is gross around

going around pressure of we around was be think at talked this labor We XX% on talked call, year. We of XX% beginning margin about the also gross So last the to some year. it's conference cost. this

service So we're still, XX% side. approximately possible year. in obviously, gross believe said that's we're before, also we as to And on trajectory us the little the trying margin this But heading is That's to that get on. 'XX, we XX% a the bit timeframe. her 'XX

Thank you. That’s helpful. very

Thank ahead. BHF. comes Houri from you. question our And of go next Oddo Please

open. is line Your

there to you And some if it, possibility really Actually, would like increase to or all be ask just talking supplier capacities? if the the is, Does okay understand say, their to it about Yes, about to – capacities? are about them? they are question held you to their with and you talking discussions you're are way a I raise to good about when afternoon. again mean your that what – discussing do you the

to say, No, them all clear a suppliers we chain. That capacity was build factories, confirmation couple the go matter a needs that executable said hire meters, confirmed need of this is for. to number get the asked. people, we specialized a they by all to supplier target their just do has to that with day I should to plans that plans square had build we of the think that very in that to machinery. timeframe they make our actually to And let's ago order that really and weeks that that our, the creating It's supply to

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capacity, you hurdles want very have that, you that expand if do practical is quickly of in to we're And the stuff a that just to And these pass that? discussion type that business are the to you that's say, what can things let's sure -- would So how are all conformation. order gating that, make basically the having. is -- This happens. normal, this

do and will XXX%, go this will on can months, says, We'll couple in that or to at likely. yes, you that they and of quarters, us. point us time get do all and get probably That's can not work yes, they as we it, but then confirmations situation. going and we're -- that XX% next the when over be XX%, confirm need we they So, along very we to yes, the it, will probably the there confirm said,

your expansion? communicate Okay. such side, can And you of on the on an already cost

I think supply the in be will cost most the of chain.

sheet. the I of XX% huge. it's think, not CapEx roughly total on balance it's I our balance mean, sheet, the

So a biggest you supply yes, when it's look it's the big the chain. the But at It's item. company, number. not size cost of the in

and at relatively So, issue the us. having the look And be an for forecasted think, capacity I it's think, extra when growth, it opportunity upside of an won't a you payback I fast then time.

very you much. Thank

All right.

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last please? caller, have we the may operator, Now,

be Thank Please, from you. Francois-Xavier go will Bouvignies that UBS. And ahead.

Your line is open.

is much very suppliers. in. just with -- ones. the One for doing on have me on basically, work I squeezing you Thank your quick maybe two you

but than You have balance of to that probably you of want risk bear mentioned, and these the you add lot and suppliers in you ahead well this or a you of sheet lot capacity, for decade. more a second risk Peter, of terms time charges to to cost build will underutilization capacity don't

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Yes.

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years, and significantly do terms we in has last the of grown that it the quite base Having of again. terms We our that, in capability. size XX also in financial have and past, actually will over done said supply

it. needed limited, it's So but I needed, it's think be it's if we'll going and to do

be going a major I issue. think So to it's don't

sharing in our is risk genes. So

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out, are industry. coming we're lead the times peers, probably the On longest in the because capacity our

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much. very you Thank

All right.

joining ASML, Now Operator, I if on all you appreciate us behalf conclude Thank the could would to I like call, for of formally it. you today. thank would you.

the Call. Thank Financial participating. QX you ASML Results Conference for concludes This XXXX you. Thank

disconnect. now may You