Chip tool maker ASML to miss analyst sales forecasts

Reuters

* Chip tool maker expects to miss full year forecasts

* Customers have postponed orders

* Ramp-up of next generation systems pushed back to next year (Adds details, analyst, share price)

By Thomas Escritt

AMSTERDAM, July 16 (Reuters) - ASML, the world's biggest maker of tools for semiconductor makers, said on Wednesday it would miss analyst forecasts for 2014 as some customers delayed purchases until next year.

The Dutch company also cited continuing difficulties in building next-generation lithography systems.

ASML supplies most of the world's major chip manufacturers, including Samsung Electronics Co. Ltd, Intel Corp and Taiwan Semiconductor Manufacturing Co Ltd (TSMC) , and acts as a leading indicator of their fortunes.

Its shares slipped by around 2 percent at the market opening but later strengthened slightly. One analyst said he would not change his "buy" recommendation on the stock.

Although results beat expectations in the second quarter, ASML said decisions by some customers to postpone capacity expansion and delays to the development of next-generation extreme ultra-violet (EUV) systems would hit full-year sales.

In its second-quarter results statement on Wednesday, ASML said it expected full-year sales of 5.6 billion euros ($7.6 billion), below the 6.1 billion analysts had been expecting, as customers delayed purchases into 2015.

"The issue is that underlying order bookings are quite weak, so you don't see an acceleration of orders at ASML ... and EUV deliveries are being shifted into 2015," said Erwin Dut, an analyst at Kempen & Co.

"Both of those courses result in a lower than expected Q4 and full year revenue outlook - so consensus for revenues has to come down by 8 percent this year and earnings by probably more than 10 percent."

The company had hoped this year to sell eight EUV systems, which use light of a very short wavelength to etch smaller, faster circuits onto chip wafers, but in Wednesday's results it said three of these would be delayed to the following year.

PRODUCTION VOLUMES

"Some customers continue to evaluate the timing of their deliveries to synchronise supply and demand, leading to an adjustment of the fourth quarter shipment forecast," ASML chief executive Peter Wennink said.

Net sales of 1.644 billion euros in the second quarter comfortably exceeded the 1.607 billion euros forecast on average by analysts polled by Reuters. Gross profit at 752 million euros was above the 715 million euros forecast.

ASML has invested heavily in EUV technology, buying Cymer Inc, a supplier of lithography light sources used to make chips, for $2.5 billion in October 2012 to speed up development of the technology, after it suffered a string of setbacks. EUV is used to make chips for the latest smartphones and other devices.

The company said its EUV systems were set to reach production volumes of up to 1,500 chip wafers a day in 2016. An installation at one customer site was currently churning out 200 wafers a day, it said.

"Next year it's all about how fast the EUV will ramp up and how robust the underlying semiconductor cycle will be," said Kempen's Dut. "But in order to be very optimistic about ASML you have to be looking to three years out, because there's no reason to be very excited if you look a couple of quarters out."

($1 = 0.7372 euro) (Reporting By Thomas Escritt; Editing by Catherine Evans)

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