Tech war: Dutch chip equipment giant ASML buoyed by Chinese demand ahead of new export curbs
- The company has raised its guidance for net revenue growth after sales came in above expectations, thanks to robust shipments to China
- ASML expects increased geopolitical tensions and global demand for mature chips to sustain Chinese equipment purchases
ASML Holding defied a slump in the semiconductor industry and boosted its full-year sales outlook on strong demand from Chinese customers, ahead of restrictions that could further impede China’s access to the company’s advanced technology.
The semiconductor equipment maker raised its guidance for net sales growth in 2023 to around 30 per cent after revenue came in above expectations, with China representing 24 per cent of shipments made in the second quarter.
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While deliveries of ASML’s advanced extreme ultraviolet (EUV) lithography machines to the US and Taiwan have slowed because of poor macroeconomic conditions and a lack of skilled workers to get new facilities up and running, the company has found overwhelming demand for its older products in mainland China, according to ASML CEO Peter Wennink.
ASML has only been able to fulfil less than 50 per cent of equipment demand for its more mature technology in China over the past two years, but that is changing, he said.
“Anything that doesn’t ship to another country goes to China, but there’s still some demand that will move into 2024 because we still don’t have a 100 per cent fill rate today,” Wennink said in an investor call on Wednesday.
Under US pressure, the company currently does not sell its EUV lithography systems to China, but it continues to ship its less advanced deep ultraviolet (DUV) systems to clients in the country.
