Growth opportunity continues
VELDHOVEN, the Netherlands, November 8, 2018 - At the Investor Day meeting today at its headquarters in Veldhoven, the Netherlands, ASML Holding N.V. (ASML) will provide an update on the company's strategy, performance and outlook. Chief Executive Officer Peter Wennink, together with Chief Technology Officer Martin van den Brink and Chief Financial Officer Roger Dassen and other senior executives, will discuss the company's growth opportunities and developments in the market and technology.
Highlights of the presentations
Company strategy, market trends and value creation
ASML sees a healthy semiconductor end market growth fueled by major innovation drivers such as 5G connectivity, artificial intelligence, autonomous driving, and big data.
This translates into growth of world-wide fab capacity in all segments, especially at the leading-edge nodes.
Strong growth opportunity in lithography lasting beyond the next decade with a mix transition from DUV to EUV.
Industry roadmap and technology strategy
Moore's Law innovation continues, driven by multiple strategies that accelerate performance scaling over the next decade.
Continued process technology innovation attracts new applications and increases wafer demand.
Moore's Law continues to enable industry growth and lithography is a key enabler of cost-effective shrink.
EUV products and business opportunity
ASML EUV lithography extends our Logic and DRAM customers' roadmap by providing lithography resolution improvement, state-of-the-art overlay performance and year-on-year cost reduction.
Our customers are preparing for EUV ramp at the 7nm Logic node and the 16nm DRAM node, with systems deliveries and ongoing qualification. EUV layer adoption continues to grow, reducing patterning complexity and cost.
EUV industrialization is well underway towards meeting our customers' requirements for availability, productivity and yield in high-volume manufacturing. The necessary ecosystem is also in place to support our customer EUV ramp.
In the second half of 2019, we will introduce the NXE:3400C, specified at 170wph and with >90% availability.
The EUV product roadmap will extend our 0.33NA EUV platform and introduce the 0.55NA EUV platform in parallel, providing comprehensive and flexible solutions to our customers' continuous demand for patterning scaling well into the next decade.
We are seeking EUV profitability at DUV profitability level through the combined execution of our value-enhancing product roadmap and aggressive systems and service cost-reduction roadmap.
Applications products and business opportunity
ASML's Holistic Lithography roadmap is driven by its unique capability to help customers achieve their pattern fidelity requirements.
2018 will be another record year for the Applications business, with product wins across all customers and all market segments (Logic, DRAM, NAND).
The primary driver of growth is the extension of our solutions into pattern fidelity control:
New offerings extend the roadmap with innovative products that combine ASML's computational technology with HMI's e-beam expertise.
Hardware and software products support the introduction of EUV into HVM.
New applications of deep learning in both computational litho and defect inspection drive improved performance.
The Applications business is projected to continue to grow at 15-20% CAGR with strong gross margins for the period 2017 through 2025.
DUV products and business opportunity
DUV system revenues increased significantly over the last decade, driven by immersion technology, and has been an important driver of ASML's growth.
Over the next 5-7 years, DUV sales will remain important and its composition will change from mainly systems sales to approximately 50% systems and 50% Installed Base Management sales.
ASML is systematically developing its DUV service and field upgrade product portfolio to meet customer requirements and improve performance, and/or extend the lifetime of its installed base, while optimizing its sales opportunities in this space.
DUV is well prepared to maintain margins during this transition through:
An innovative DUV Technology Roadmap aligned with customer roadmaps.
Adopting commonalities between EUV and DUV module development.
Continuously improving its operations to become leaner and more efficient, while driving quality of systems, services and field options.
Business model and capital allocation strategy
We have invested substantially in technology leadership and have thereby created significant shareholder value.
Our products and services will continue to enable our customers to achieve cost-effective shrink, fueling the highly profitable and growing semiconductor and technology applications industry.
At the last Investor Day in New York in October 2016, we announced that we expected to grow our net sales to approximately EUR 10 billion by 2020, which was adjusted after the HMI acquisition to EUR 11 billion. We currently expect our net sales to grow to around EUR 13 billion by 2020, which is supported by a scenario of moderate market growth.
Based on different market scenarios, we have an opportunity to grow our annual revenue for 2025 to between EUR 15 billion (low market) and EUR 24 billion (high market).
We expect to continue to return significant amounts of cash to our shareholders through a combination of share buybacks and growing dividends.
Webcast and presentations
For those not joining the Investor Day in person, there will be a live webcast (audio and slides) on November 8, 2018, starting at 13:00 Central European Time / 09:00 U.S. Eastern Time and ends at 17:00 Central European Time / 13:00 U.S. Eastern Time. Link: https://asml.nepgroup-webinars.com/investor-day-2018.
The presentations and the recording of the audio webcast will be available at www.asml.com as of November 8, 2018 at 18:00 CET.