(Bloomberg) -- ASML Holding NV forecast second-quarter sales in line with analysts’ expectations, as Europe’s largest semiconductor-equipment maker won orders for three more of its newest lithography machines.
The Veldhoven, Netherlands-based company predicts sales of 2.5 billion euros ($2.8 billion) to 2.6 billion euros for the second quarter, compared with an average analyst estimate of 2.55 billion euros. A year earlier, ASML reported sales of 2.74 billion euros.
ASML forecasts a gross margin of about 41 to 42 percent in the second quarter of the year, trailing the average estimate for 42.4 percent.“The outlook for the remainder of the year remains unchanged, as we see accelerating growth through 2019 on the back of significant technology transitions,” Chief Executive Officer Peter Wennink said in a statement.
The company raised its revenue guidance at the end of last year, expecting net sales to grow to 13 billion euros by 2020, up from a previous forecast of 11 billion euros. ASML is an important supplier to chipmakers, with clients including Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co. Its newest machines, called extreme ultraviolet lithography systems or EUV, etch smaller circuits while increasing capacity and speed. EUV machines, about the size of a bus, cost more than 100 million euros each.First-quarter sales came in at 2.2 billion euros, beating the average analyst estimate of 2.11 billion euros.
ASML expects the gross margin to “really develop favorable in the course of the second half,” Chief Financial Officer Roger Dassen said in a video, on the back of two developments.“The first one is the introduction of the 3400C machine in the second half, which has a significantly better margin profile than the current machines, and the second category is the service revenue and margin on EUV.” After helping customers gearing up EUV into high volume manufacturing, leading to a significant rise in costs, the Dutch company expects a rise in revenue in the second half amid increased wafer output.
(Updates with CFO comment on margins in last two paragraphs.)
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