Dutch-based ASML Holding announced some good news for the semiconductor industry in light of uncertainty around COVID-19.
The company makes large Extreme Ultraviolet Lithography (EUL) systems that are widely used by chipmakers to trace patterns on silicon wafers in the production of various semiconductors.
ASML said on Wednesday it had 2.4 billion Euro sales ($2.6 billion US) in the first quarter of 2020, with 0.4 billion Euro net income ($437 million US).
Bookings were 3.1 billion Euro in the quarter with about half for EUV systems, an indication of “continued strong demand for EUV,” the company said.
On March 30, the company announced it would make no buybacks of shares and predicted a sales range that was met with the results announced Wednesday. However, the company is not providing guidance due to the uncertainty over COVID-19.
"The demand outlook is currently unchanged and we have not encountered any push-outs or cancellations this year,” CEO Peter Wennick said in a statement. “Despite the challenging circumstances, to date we have been able to continue ASML’s operations. Our order intake is strong. Many of the investments made by our customers are strategic and support their long-term plans.”
“However, in light of the current risks and uncertainties related to COVID-19, we decided to refrain from giving guidance for Q2 and for the full year 2020,” he added. “There is significant uncertainty about how the current COVID-19 crisis will impact the global GDP development, end markets, our manufacturing capability and supply chain.”
In a call with analysts Wennick said COVID-19 has had a limited impact ASML manufacturing capability. Some suppliers have experienced closures due to lockdown and shelter-in-place orders. “We are managing risk via alternative sourcing and…a lot of creativity,” he said, according to a transcript from Seeking Alpha.
“These are unprecedented and challenging times but we will get through it,” Wennick added. “Despite the fact the current environment provides clearly near-term challenges and uncertainties, the positive industry momentum around innovation and expanding new markets further strengthens our confidence in our future growth scenarios.”
The ASML stock price declined 2.2% to $282.49 at the close of the Nasdaq market on Wednesday. ASML, based in Eindhoven, Netherlands, was founded in 1984 by Philips and ASM International and has grown to 23,000 employees.