ASML reported net income of 1.9 billion euros (approximately $2.1 billion) for the second quarter, representing an increase of 37.6% compared to the same period in the prior year. Additionally, they raised their sales expectation for 2023 to a 30% year-on-year growth compared to a previous forecast of 25%. The Dutch enterprise produces costly machines which are crucial in the fabrication of advanced microchips but is subject to U.S. export regulations to China.ASML, one of the leading semiconductor equipment firms in the world, reported a surge in revenue and profit in the second quarter; however, they pointed to the present macroeconomic "uncertainties". The Dutch company creates high-priced instruments needed for manufacturing the most advanced chips, and their customers include important entities like the largest contract semiconductor maker, TSMC.In the second quarter, ASML posted results which surpassed Refinitiv estimates - net sales of 6.9 billion euros ($7.7 billion) and a net profit of 1.9 billion euros - a 27% and 37.6% year-on-year increase, respectively. They predicted net sales in Q3 of this year to fall between 6.5 and 7 billion euros. In addition, they raised their outlook for the year 2023, now expecting sales to rise 30% year-on-year, above the 25% projected before. This is due to their Deep Ultraviolet (DUV) lithography machines being used to craft memory chips, which are used for AI applications and various devices like laptops and servers.Nevertheless, CEO Peter Wennink shared worries about the macroeconomic situation: "Our customers across different market segments are currently more wary due to ongoing macroeconomic uncertainties, and therefore project a later recovery of their markets. Additionally, the shape of the recovery is still uncertain."Chipmakers are curbing the production of chips, and therefore using ASML tools less, due to low demand for finished products, such as consumer electronics.
ASML has been impacted by the United States effort to stop China from accessing certain technologies, such as those used for creating advanced semiconductors. Last October, the U.S. imposed broad export limitations regarding these technologies to China, believing they could be used for military or AI purposes. The Biden administration is pressuring other nations to take similar steps. In June, the Dutch government, where ASML is headquartered, imposed export regulations on advanced semiconductor equipment. Companies must obtain a license from the government to send out specific technologies. ASML commented that these laws applied to some of their DUV machines at the time. Wennink stated the regulations were not unexpected following their emergence in March and that he does not expect a considerable effect on their 2023 year or future prospects. The CEO also said they are observing for any further restrictions from the U.S. as there have been rumors of growing controls on technology exports to China.
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