Microchip equipment maker ASML says materials shortage and logistics issues to weigh on fourth-quarter revenue
ASML Holding, Europe’s largest tech company, on Wednesday forecast revenue will miss analyst estimates in the fourth quarter as it struggles to get the necessary materials and reported start-up issues at a new logistics center.
The microchip equipment maker reported a 64% jump in third-quarter ending Oct. 3 net income, to €1.74 billion ($2 billion), or €4.26 per share, as sales rose 22% to €5.24 billion. According to FactSet, analysts had forecast earnings of €3.95 a share on revenue of €5.29 billion.
However, the lithography system maker said sales would slow to €4.9 billion to €5.2 billion, compared to analyst expectations of €5.24 billion.
“It’s not unique to ASML obviously. We read it in the newspapers in many industries every single day,” said CFO Roger Dassen in a recorded earnings call of the materials shortage. “But obviously particularly when we’re pushing the supply chain to gear up capacity, you know this phenomenon could obviously pop up.”
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Another issue he flagged is that ASML can’t recognize revenue until their machines are installed, even if they are shipped. “In the current environment where customers are really pushing for tools as quickly as they can get them, some customers really push for early shipments. We’ve seen that phenomenon before, you might remember that, and that means that customers actually get the tool without the tool first being tested for factory acceptance test.”
Dassen said the chips shortage phenomenon is still there. By business, he said the whole notion of digital transformation is driving demand not just for the most advanced nodes but also mature ones. “And that combination really means that on both fronts, the demand both for mature and for advanced continues to be very, very strong for us,” he said.
On memory chips, he said there’s particularly strong demand in smartphone and server end markets.
An issue next year will be upgrades, which require downtime for installation. “So that will be the determining factor, I think, for how fast the installed base business next year is going to grow, how much machine time do we actually get from customers to do this.”
