Published in PC Hardware

ASML reports profits through the roof

by on21 July 2021

Profits up 38 percent 

Dutch supplier of computer chip making gear, ASML, said that its 2021 sales outlook has shot up by 40 percent amid the global computer chip shortage.

The Dutch company said demand remained strong as major chip makers, such as TSMC Samsung and Intel are pressing to expand production. 

Chief Executive Officer Peter Wennink said. "Everybody is working extremely hard, us and our suppliers, to actually produce ... more machines. It's all driven by basically what we are seeing today which is the digital revolution."

ASML's market valuation has swelled to a record high of more than 240 billion euro ($283 billion). Orders for lithography systems reached a record 8.3 billion euro in the second quarter, boosting an order book that was 75 percent larger than at the end of the first quarter.

ASML reported orders worth 4.9 billion euro for its extreme ultraviolet (EUV) machines used to manufacture advanced chips.

Alongside buying ASML's equipment, chipmakers invested in software to boost the capacity of existing gear, Wennink said, helping drive up ASML's gross profit margin to 50.9 percent.

"Clients are structurally increasing capacity on the back of the digitalisation wave", ING analyst Marc Hesselink wrote in a note. "Overall there is a very positive tone on demand for 2021 and beyond."

ASML, which reported second-quarter net profit up 38 percent at 1.02 billion euro ($1.2 billion), lifted its 2021 sales growth outlook to 35 percent.

It said it would buy back nine billion euro worth of its own shares by the end of 2022, replacing its almost finished six billion euro buyback launched last year.

"I think the future for the industry looks bright. The semiconductor makers currently have a combined sales number of about $500 billion. That could be a trillion dollars by the end of this decade", Wennink said.


Last modified on 21 July 2021
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