ASML Holding(ASML)2021-05-27 20:28ASML Holding N.V. Conference Call Summary Company Overview - Company: ASML Holding N.V. (NASDAQ: ASML) - Event: JPMorgan Virtual European TMT Conference - Date: May 27, 2021 Key Points Industry and Market Dynamics - Customer Behavior: Customer behavior has remained consistent and optimistic since the last results in April, with a focus on increasing capacity to meet demand [2][6] - EUV Capacity: ASML is targeting a capacity of 55 EUV tools for 2022, with discussions ongoing to potentially exceed this number based on customer demand [4][6] - Supply Chain Challenges: The main focus is on supply chain components, particularly optical columns and drive lasers, to increase EUV capacity [4][6] Demand Forecast - 2023 Demand Outlook: There is an expectation that demand for EUV tools in 2023 will exceed 55 units, based on customer conversations and market trends [6][9] - Deep UV Demand: The demand for Deep UV tools is expected to remain strong, driven by sales in China and the growth of mature nodes, particularly in IoT applications [20][25] Product Development and Pricing - Tool Pricing: The pricing strategy is based on the incremental value provided to customers, with a projected low-10% uplift in average selling price (ASP) for the new D tool compared to the C tool [11][12] - Throughput Improvement: The new D tool is expected to improve throughput from 135 to 160 wafers per hour, representing a 19% increase [13] Installed Base Management - Growth in Installed Base: The installed base management business is expected to grow, with a focus on quick upgrades that enhance productivity without significant downtime [40][42] - Service Revenue: Regular service revenue is anticipated to increase as the installed base of EUV tools grows, contributing to overall revenue [40][41] Strategic Focus - R&D Investment: ASML is committed to significant R&D investments to maintain its competitive edge in EUV and Deep UV technologies [59][60] - M&A Strategy: The company is not currently focused on large acquisitions but may consider opportunities in adjacent businesses in the future [61][62] Financial Performance - Revenue Growth: Memory segment revenue is expected to grow by 50%, from €2.9 billion to €4.3 billion, driven by a recovery in the DRAM market and increased sales in China [31][32] - Shareholder Returns: ASML is actively returning cash to shareholders through share buybacks and dividends, with a focus on maintaining strong financial health [58][62] Regulatory Environment - China Shipments: ASML can still ship Deep UV systems to China, but EUV shipments are restricted due to export regulations. Future regulatory changes could impact the ability to ship advanced technologies [52][54] Future Outlook - EUV and Deep UV Margins: The gross margins for EUV systems are expected to improve with the introduction of the D model, and a crossover point between EUV and Deep UV margins is anticipated with the E model introduction in 2023 [55][57] Conclusion ASML is positioned for growth in the semiconductor industry, with strong demand for both EUV and Deep UV technologies. The company is focused on increasing capacity, enhancing product offerings, and maintaining robust financial performance while navigating regulatory challenges.