ASML Sees Higher Orders for Advanced Machines

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October 12, 2011, 12:09 PM EDT By Maaike Noordhuis

(Closes share price in second paragraph, adds comments from conference call in seventh paragraph.)

Oct. 12 (Bloomberg) -- ASML Holding NV, Europe’s biggest semiconductor-equipment maker, said fourth-quarter orders will increase from the previous three months as customers add capacity and shift to more advanced machines.

Bookings at the Veldhoven, Netherlands-based company will rise because of continued demand for “leading-edge systems,” Chief Executive Officer Eric Meurice said in a statement today. ASML shares climbed 6.3 percent to close at 28.20 euros in Amsterdam trading, the biggest jump since Aug. 11.

Net bookings excluding second-generation EUV, or extreme untraviolet, lithography systems reached 514 million euros ($709 million) in the third quarter, beating ASML’s earlier forecast of not more than 500 million euros. Net income rose 32 percent from a year earlier to 355 million euros, beating a 323 million- euro average estimate of 16 analysts surveyed by Bloomberg.

“The outlook for a sequential increase in orders is reassuring,” said Victor Bareno, an Amsterdam-based analyst at SNS Securities.

Revenue rose 24 percent to 1.46 billion euros.

‘Mixed Bag’

Next year will be a “mixed bag,” Chief Financial Officer Peter Wennink said on the company’s website. “Generally we expect slower growth next year. On the other hand, new applications like tablets and new smartphones need advanced semiconductor devices. Those will drive the need for leading- edge technology.”

The situation differs from that of the banking crisis in 2008 and 2009, Meurice said in a conference call. “We had a freeze of six months at the time,” he said. “Today we do have a crisis, but customers do feel they can take the decisions on investments.”

ASML predicts fourth-quarter revenue will exceed 1.1 billion euros, including delivery of one EUV system for about 40 million euros of sales with a profit margin of zero.

ASML, the maker of machines that produce chips for Nokia Oyj’s mobile phones and Apple Inc.’s iPads, said it’s maintaining its forecast for 2011 of revenue of about 5.5 billion euros.

That figure includes EUV systems. ASML expects these machines, which will help shrink the size of chips while increasing their capacity and speed, will become “commercially viable” in the second half of 2012, Meurice said. The company has had a delay of about six months in developing them as it had to address issues at the light source, he said.

ASML is the world’s largest maker of machines to project lines on the silicon slices from which chips are made. Its main competitor is Japan’s Nikon Corp. Applied Materials Inc., based in Santa Clara, California, is the world’s largest maker of semiconductor equipment.

ASML shares have declined 2.4 percent this year, giving the company a market value of 12.5 billion euros.

--Editors: Thomas Mulier, Robert Valpuesta.

To contact the reporter on this story: Maaike Noordhuis in Amsterdam at mnoordhuis@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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