ASML releases Q1 financial report: EUV demand is strong, with 4 EUV units delivered and 11 units sold in the first quarter

Today, ASML released its first quarter financial report for 2020. In Q1, it achieved net orders of 3.1 billion euros, net sales of 2.4 billion euros, a gross profit margin of 45.1%, and a net profit of 400 million euros. Compared with the net sales of 2.2 billion euros, gross profit margin of 41.6%, and net income of 355 million euros in Q1 2019, all of them have achieved a certain degree of growth.

Due to the spread of the COVID-19 epidemic, the supply chain and shipment delays have become more complicated. At the end of March, ASML revised its Q1 revenue forecast from 3.1 billion to 3.3 billion euros to 2.4 billion to 2.5 billion euros. The company said that the impact of the epidemic on its equipment manufacturing capabilities was limited and did not affect market demand. However, in the short term, it will have three impacts on the company's performance. The first is that the shipment of DUV equipment to customers is delayed due to traffic restrictions; secondly, the supply chain has also encountered some problems, but they have been resolved. The first batch of NXE: 3400C models was delayed in part because some accessories exceeded the original planned production cycle due to supply chain problems; third, some customers requested that EUV equipment be shipped before passing the normal factory acceptance test (FAT), which also delayed the recognition of revenue, because the normal final acceptance procedure should be carried out after the customer's on-site installation is successful.

In this regard, ASML President and CEO Peter Wennink said at today's earnings conference that the impact of Q1 revenue recognition is expected to be transferred to the subsequent quarters of 2020. "We delivered four EUV systems this quarter, but due to the reasons mentioned in the previous statement, we only recognized the revenue of two systems. Overall, ASML's net bookings in the first quarter remained strong, reaching 3.1 billion euros, including 1.5 billion euros of EUV systems (11 units), indicating that the market demand for EUV is still strong."

Due to the uncertainty of the impact of the epidemic, ASML decided not to provide financial guidance for the second quarter and the full year of 2020, and will continue to suspend the stock repurchase plan for the second quarter of 2020. "The outlook for demand for lithography machines remains unchanged this year, and there has been no termination or cancellation of orders. Despite the difficulties, ASML is currently operating normally and has a huge order volume. Most of the customers' investments are strategic to support their long-term plans. There is great uncertainty about how the current epidemic will affect the development of global GDP, the terminal market, ASML's production capacity and supply chain." Peter Wennink pointed out, "To fight the epidemic, the company's main goal is to do our best to ensure the safety of our employees and their families. The second goal is to ensure that we can continue to provide services to our customers and ensure the continuity of product blueprints and supply."

Jiwei.com previously reported that ASML is developing a new generation of EUV lithography machines, which will have a 70% improvement in resolution and coverage over their current extreme ultraviolet lithography machines, and is expected to start shipping in 2022. Last year, they shipped 26 EUV lithography machines, and are expected to deliver 35 EUV lithography machines in 2020, and 45 to 50 in 2021, about twice as much as in 2019.