ASML Q4 FY12/23 Earnings Review
Stock shot up nearly 10% post earnings, can it still go uppp...???
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ASML Q4 FY12/23 highlights
By Jams O'Donnell
ASML grew revenue by 30% in 2023
Management expects soft Q1 and Q2, flat 2024 en route to growthy 2025
China market staying strong, capacity expansion worldwide plays into ASML's hands
ASML reported a record ~28 billion€ TTM revenue for 2023, 30% increase with respect to the previous year. The stock has shot up (+10% at the time of writing) and might still have quite a way to go.
Few topics addressed on the earnings call:
Semis show signs of recovery, including memory (although ASML mostly has visibility into the advanced DDR, HBM chips necessary for training of large/massive/huge AI models).
The first few next-generation photolithography systems (High-NA-EUV) have been delivered to Intel. According to management, these systems provide great cost/transistor-density value, and all their customers involved in leading-edge chip manufacturing - both logic and memory - have put in orders.
A large share of fulfilled orders in 2023 was shipped to China, but more as a catch-up with the backlog that had built up in 2022. The Chinese market however is expected to stay strong, trade restrictions affect leading-edge equipment, whereas most of the orders volume comes from mature chips manufacturers serving the energy transition, automotive, IoT etc. industries.
Management expects a slow down in Q1 and Q2, and overall a flat 2024, with the revenue growth from the capacity expansion in Europe, North America, and Japan kicking in in 2025.
The downcycle is most visible in cash management, with no stock buybacks this quarter and "only" a 5% dividend increase.
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