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ASML Holding N.V. (ASML)
Credit Suisse 2011 Annual Technology Conference
November 29, 2012 6:00 PM ET
Peter Wennink – Chief Financial Officer
Previous Statements by ASML
» ASML Holding's Management Present at the UBS Global Technology and Services Conference (Transcript)
» ASML Holdings Company Conference Presentation (Transcript)
» ASML Holding's Management Presents at Morgan Stanley 11th Annual Technology, Media & Telecoms Conference (Transcript)
I guess like I will first start off with what you are seeing sort of near term in terms of business trends it feels like almost an eternity since you reported almost two months ago, you were the first one to report. It feels like there have been a lot of things that have changed certainly from a macro perspective people have gotten more concerned on Europe. But also some of your peers that have reported since have sounded at least on face value a lot more optimistic about near term order trends and perhaps you sounded, so perhaps you could talk a little bit about how things are in the near term.
Yeah, sure. When we reported the Q3 results we did two months ago or close to two months ago. We were still in a situation where customers actually indicated to us quite specifically what they needed for 2012. And in summary that was in every segment memory segment NAND or DRAM or logic very clearly that they want to do the technology transitions. So, which means for DRAM they wanted to go for 3X to advance to the 2X and for logic to the 28 and 32 nanometer node.
Having said that, they talk a lot less about what it is that we didn’t see a lot of orders. And that of course at that time we at the end of Q3 beginning of Q4 are probably understandable because they didn’t allocate their budgets yet. There were still a lot of uncertainty issue as alluded to but since then and especially since the last couple of weeks I think customers are putting their money where their mouth is. And they haven’t changed their forecast as much if anything that have pulled a few tools in here and there in their forecast. But they are at least following up with in orders. I think that’s also the major driver of why I think our peers in the industry feel more positive that I think customers are stepping up. And so what I said is means that technology transitions will actually happen, on top of that we see some larger players in every segment putting also capacity type orders in for the leading edge, so that’s memory and logic.
Got it is the strength coming more from I guess the foundry side or is it perhaps more coming from the logic side.
Its foundry and memory I think also in memory there are challenges DRAM used to go through the 30 nanometer node like I said enhanced to the 20 and that of course needs the new type of the quality equipment. And also leaders in that segment I clearly see an opportunity to expand their market share by investing more heavily in leading actual quality. So its memory and foundry not so much later process.
Got it, got it I guess ASML has a longer cycle time and lead time than the average semi cap equipment company and typically and you don’t want to see your backlog run too low I guess, it might take a little longer to restart the supply chain. I guess when you think about from a shipment perspective it to me feels like sort over the next year should be close to this $4 billion sort of level in terms of system shipments perhaps more. How do you sort of see the pipeline or shipments building out into the first half of next year for you?
I would say the roll out of the technology investments by our customers will be gradual throughout the year. I mean there are many customers that need to do all those transitions that I just talked about. On top of that we are like I said we see the leaders in those segments that having also the financial capability and the opportunity to invest more in the leading edge technology.
They tend to and which make sense if you see an opportunity you don’t want to wait. So basically there is a tendency to see that more in the first part of the year while at least the major part of it. That made the first half of 2012 I would say healthy one of the way that we look at it now and also expect that of course that needs to be supported by the orders, which are the next few quarters we will probably see that happening. But it’s very difficult to say anything about the second half of 2012, not so much because there is uncertainty but simply because our customers don’t have the visibility. So they don’t talk about it if they need extra capacity and are seeing opportunity they want it sooner rather than later that’s where we are today.