ASML turnover increased 30% last year despite export bans, still struggling chip market

Dutch chip machine manufacturer ASML recorded a turnover of 27.6 billion euros last year - 30 percent more than in 2022. The Veldhoven company expects a similar turnover in 2024 despite export restrictions to China and a still-recovering chip market putting pressure on results.

President and CEO Peter Wennink said 2023 was “another strong year” for ASML. “The semiconductor industry continues to work through the bottom of the cycle. Although our customers are still not certain about the shape of the semiconductor market recovery this year, there are some positive signs.” ASML had a strong order intake in the fourth quarter, which “clearly supports future demand,” Wennink said.

ASML is benefiting from major companies investing in chips for use in artificial intelligence (AI), but the demand for chips for smartphones, among other things, is weaker. The company’s results are also somewhat pressured by export restrictions to the Chinese market by the United States and the Netherlands. ASML is no longer allowed to supply several of its advanced machines to Chinese companies.

Despite that, the chip machine manufacturer achieved a net profit of 7.8 billion euros last year, creating 19.91 euros in earnings per share. The net income was 5.6 billion euros in 2022. The gross profit margin was 51.3 percent, slightly higher than a year earlier.

The company’s sales growth was driven by a 60 percent increase in deep ultraviolet lithography systems, with sales reaching 12.3 billion euros. Another 9.1 billion euros in revenue was reached in extreme ultraviolet lithography, up 30 percent from 2022.

During its investor call, the company will announce plans to pay dividends for 2023 of 6.10 euros per ordinary share to the company’s stockholders. This will start with an initial 1.45 euro dividend per share on February 14.

ASML now has 22,860 employees in the Netherlands, of whom 40 percent are of other nationalities. Their workforce in the Netherlands includes citizens from 123 different countries.

The company now employs 42,420 people across the world, an 8.5 percent increase from 2022. Roughly one-fifth of them are women. A total of 8,225 work in the United States, up 10 percent, and their workforce in Asia grew by about 3 percent to 9,110. Another 2,225 work in European and Middle Eastern countries apart from the Netherlands.

In spite of the positive signals that the chip market is improving, ASML maintains its “conservative” outlook for this year, expecting a similar turnover as in 2023, Wennink said. “We also expect 2024 to be an important year to prepare for significant growth that we expect for 2025.” Additionally, “We need to continue to make investments this year in capacity ramp and technology.”