Q4 2023 ASML Holding NV Earnings Call - Pre-Recorded

January 24, 2024

Roger Dassen: Revenue for the quarter came in at EUR 7.2 billion, which was higher than guided, primarily driven by the fact that the installed base business at EUR 1.6 billion was higher than we expected. That was both as a result of higher service revenue and higher revenue from upgrades. The higher installed base business also drove up the gross margin. Gross margin came in at 51.4%. Also higher than guided as a result of, as I mentioned, the higher installed base business. Net income for the quarter came in at EUR 2 billion. You know, after a few soft quarters, the order intake for the quarter was very, very strong.

Revenue for the quarter came in at $7.2 billion, which was higher than guided, primarily driven by the fact that the installed base business at $1.6 billion was higher than we expected. And that was both as a result of higher service revenue and higher revenue from upgrades.

Revenue for the quarter came in at $7.2 billion, which was higher than guided, primarily driven by the fact that the installed base business, at $1.6 billion, was higher than we expected. And that was both as a result of higher service revenue and higher revenue from upgrades. That fact, so the higher installed base business also drove up the growth margin, so the growth margin came in at 51.4%, also higher than they guided as a result of, as I mentioned, the higher installed base business. Net income for the quarter came in at 2 billion euros, and after a few soft quarters, the order intake for the quarter was very, very strong, actually a record order intake at 9.2 billion euros. If you look at the composition of that, it was about 50-50 for memory versus logic, and around 5.6 billion out of the 9.2 was related to EUV, both low NA and high NA.

Peter T. F. M. Wennink: The revenue for the quarter came in at $7.2 billion, which was higher than guided, primarily driven by the fact that the installed base business, at $1.6 billion, was higher than we expected. And that was both as a result of higher service revenue and higher revenue from upgrades. That fact, so the higher installed base business also drove up the gross margin. Gross margin came in at 51.4%, also higher than the guidance as a result of, as I mentioned, the higher installed base business.

2 billion, which was higher than guidance, primarily driven by the fact that the installed base business at 1.6 billion was higher than we expected and that was both as a result of a higher our service and our service revenue and higher revenue from the from upgrades.

Roger Dassen: The higher installed base business also drove up the gross margin. Gross margin came in at 51.4%. Also higher than guided as a result of, as I mentioned, the higher installed base business. Net income for the quarter came in at EUR 2 billion. You know, after a few soft quarters, the order intake for the quarter was very, very strong.

That fact, so the higher installed base business also drove up the growth margin, so growth margin came in at 51.4%, also higher than they guided as a result of, as I mentioned, the higher installed base business.

That fact, so to higher installed base business also drove up the gross margins. So gross margin came in at 51.4% also higher than the guidance as a result of as I mentioned the entire installed base of business.

Net income for the quarter came in at 2 billion euros and after a few soft quarters the order intake for the quarter was very very strong, actually a record order intake at 9.2 billion euros.

Peter T. F. M. Wennink: Net income for the quarter came in at 2 billion euros. And you know, after a few soft quarters, the order intake for the quarter was very, very strong, actually a record order intake at 9.2 billion euros. If you look at the composition of that, it was about 50-50 for memory versus logic and around 5.6 billion out of the 9.2 was related to EUV Both low and a and high name, and what about the results for the full year So for the full year, revenue came in at twenty-seven point six billion with a gross margin of fifty one point three percent. And we ended the year with, you know, a total net income of seven point eight billion and also an order book, a total order book of thirty nine billion. Can you give us an update on the impact of fast shipments on 2023 and 2024, my favorite topic?

Net income for the quarter came in at two 2 billion euros, and and you know after a few soft quarters and the order intake for the quarter was very very strong actually a record order order intake at 9.2 billion 1 billion euros.

Roger Dassen: Actually, a record order intake at EUR 9.2 billion. If you look at the composition of that, it was about 50-50 for memory versus logic, and around EUR 5.6 billion out of the EUR 9.2 billion was related to EUV, both Low-NA and High-NA.

Roger Dassen: Actually, a record order intake at EUR 9.2 billion. If you look at the composition of that, it was about 50/50 for memory versus logic, and around EUR 5.6 billion out of the EUR 9.2 billion was related to EUV, both Low-NA and High-NA.

If you look at the composition of that, it was about 50-50 for memory versus logic, and around 5.6 billion out of the 9.2 was related to EUV, both low NA and high NA. And what about ASML's results for the full year, 2023? So for the full year, revenue came in at 27.6 billion, with a gross margin of 51.3%, and we ended the year with a total net income of 7.8 billion, and also an order book, a total order book of 39 billion. Can you give us an update on the impact of fast shipments on 2023 and 2024? My favorite topic. So, you know, when it comes to fast shipments, as you know, in the course of 2023, we changed the testing protocol for immersion tools on fast shipment, and we agreed those with customers. And as a result of that, we could recognize revenue again upon shipment. So that's for immersion. When it comes to EUV, earlier on, we said that we expected around 2.3 billion euros of value of fast shipments. And at the end of this year, for EUV shipped, but not yet recognized in revenue, that turned out to be quite a bit lower, 700 million, and there's a few reasons for that.

If you look at the composition of that it was about 50 50 for memory versus versus a logic and around <unk> 5.6 billion out of the nine point to was it related to EV, both at <unk> and tiny.

Operator: What about ASML's results for the full year 2023?

Operator: And What about ASML's results for the full year 2023?

And what about incremental results for the full year 'twenty three so for the full year revenue came in at 27.6 billion.

Roger Dassen: For the full year, revenue came in at EUR 27.6 billion with a gross margin of 51.3%. We ended the year, you know, with a total net income of EUR 7.8 billion, and also a total order book of EUR 39 billion.

Roger Dassen: For the full year, revenue came in at EUR 27.6 billion with a gross margin of 51.3%. We ended the year with a total net income of EUR 7.8 billion, and also a total order book of EUR 39 billion.

So for the full year, revenue came in at 27.6 billion, with a gross margin of 51.3%, and we ended the year with a total net income of 7.8 billion and also an order book of 39 billion.

With.

With a gross margin of 51.3% and we ended the year with you know with a total net income of $7 8 billion and also an order a book a total order book of 39 billion.

Operator: Can you give us an update on the impact of fast shipments on 2023 and 2024?

Operator: Can an you give us an update on the impact of fast shipments on 2023 and 2024?

Operator: Can you give us an update on the impact of fast shipments in 2023 and 2024?

Can you give us an update on the impact of fast shipments on 2023 and 2024 my favorite topic.

Roger Dassen: My favorite topic. You know, when it comes to fast shipments, as you know, in the course of 2023, we changed the testing protocol for immersion tools on fast shipment, and we agreed those with customers. As a result of that, we could recognize revenue again upon shipment. That's for immersion. When it comes to EUV, earlier on, we said that we expected around EUR 2.3 billion of value of fast shipments at the end of this year for EUV shipped, but not yet recognized in revenue. That turned out to be quite a bit lower, EUR 700 million, and there's a few reasons for that.

Roger Dassen: My favorite topic. When it comes to fast shipments, as you know, in the course of 2023, we changed the testing protocol for immersion tools on fast shipment, and we agreed those with customers. As a result of that, we could recognize revenue again upon shipment. That's for immersion.

My favorite topic. So, you know, when it comes to fast shipments, as you know, in the course of 2023, we changed the testing protocol for immersion tools for fast shipments, and we agreed those with customers. And as a result of that, we could recognize revenue again upon shipment. So that's immersion. When it comes to EUV, earlier on, we said that we expected around 2.3 billion euros of value for fast shipments. And at the end of this year, for EUVs shipped but not yet recognized in revenue, that turned out to be quite a bit lower, 700 million euros, and there are a few reasons for that. First off, we had a couple of tools that were originally scheduled for shipment in, let's say, the last couple of weeks of February.

Peter T. F. M. Wennink: So you know it comes to fast shipments as you as you know in the course of 2023 we changed The testing protocol for immersion tools on fast shipment And we agreed those with customers and as a result of that we could we could recognize revenue again upon upon shipment So that's for immersion when it comes to EUV Earlier on we said that we expected around two point three Billion euros of value of fast shipments at the end of this year for for EUV shipped, but not yet recognized in revenue That turned out to be quite a bit lower 700 million and there's a few reasons for that, First off, we had a couple of tools that were originally scheduled for shipment in, let's say, the last couple of weeks of 23, actually slipped into the first couple of weeks of 24. And secondly, we had some shifts in demand from customers that also led to a few tools slipping into 24. So as a result of that, you know, the value came in at 700 million rather than at 2.3 billion. That's that.

Speaker Change: So it's country fashion as you as you know and in the course of 2023 we changed our the testing protocol for immersion tools on fashion and we agreed those with customers and as a result of that we could we could recognize revenue again upon upon shipment that's for our marine when it comes to <unk>.

Roger Dassen: When it comes to EUV, earlier on, we said that we expected around EUR 2.3 billion of value of fast shipments at the end of this year for EUV shipped, but not yet recognized in revenue. That turned out to be quite a bit lower, EUR 700 million, and there's a few reasons for that.

Speaker Change: U V and earlier on we said that we expected around 2.3 billion euros of value of fashion <unk> at the end of this year for four easy are shipped but not yet recognized in revenue.

Speaker Change: That turned out to be quite a bit lora, a $700 million and there's few reasons for that.

Roger Dassen: First off, we had a couple of tools that were originally scheduled for shipment in, let's say, the last couple of weeks of 2023. They actually slipped into the first couple of weeks of 2024. Secondly, we had some shifts in demand from customers that also led to a few tools slipping into 2024. As a result of that, you know, the value came in at EUR 700 million rather than at EUR 2.3 billion. That said, for 2024, we expect at the end of 2024 that we will not do fast shipments for EUV.

First off, we had a couple of tools that were originally scheduled for shipment in, let's say, the last couple of weeks of 23. They actually slipped into the first couple of weeks of 24. And then secondly, we had some shifts in demand from customers that also led to a few tools slipping into 24. So as a result of that, the value came in at 700 million rather than at 2.3 billion.

Speaker Change: First off we had a couple of tools that were originally scheduled for shipment in let's say the last couple of weeks of 23 actually slipped into the first couple of weeks of 24, and then secondly, we had some shifts in demand from the from customers that also led to a few tools are slipping into <unk> into 'twenty.

They actually slipped into the first couple of weeks of 24. And then, secondly, we had some shifts in demand from customers that also led to a few tools slipping into 24. So as a result of that, the value came in at 700 million rather than 2.3 billion. That's it. For 2024, we expect at the end of 2024 that we will not do fast shipments for EUV, the main reason being that we assume that we won't have a capacity constraint for EUV in 2024 because of the addition of capacity that we've been talking about. And that means that in our guidance, when we talk about our expectation of 24 revenue being similar to 23 revenue, the revenue from these fast shipments, so the 700 million, but also these tools that slip from 2023 into 2024, that's included in that expectation.

Speaker Change: So as a result of that you know the value came in at 700 million rather than at a 2.323 billion.

That's that. For 2024, we expect at the end of 2024 that we will not do fast shipments for EUV. Main reason being that we assume that we'll not capacity constraint for EUV in 2024 because of the addition of capacity that we've been talking about.

That's at.

Peter T. F. M. Wennink: For 2024, we expect, at the end of 2024, that we will not do fast shipments for EUV, the main reason being that we assume that we won't be capacity-constrained for EUV in 2024 because of the additions of capacity that we've been talking about. And that means that in our guidance when we talk about our expectation of 24 revenue being similar to 23 revenue, the You know the revenue from these fast shipments, so the 700 million. But also, you know these tools that slip from 2023 into 2024, that's included in that expectation. Further to 2024, can you provide an initial outlook for the full year? So yeah, I mean, as we said last quarter, you know, clearly, there is still uncertainty. There are uncertainties on the macro front, and also I think it's clear to see that our customers are navigating through the downside of the cycle.

Speaker Change: For 'twenty 'twenty four we expect at the end of 'twenty 'twenty four that we will not do a fast shipments for F. R. E. V main reason being that we assume that we'll not capacity constrained for EV in 2024 because of the additions of the <unk>.

Roger Dassen: Main reason being that we assume that we're not capacity constrained for EUV in 2024 because of the addition of capacity that we've been talking about. That means that in our guidance, when we talk about our expectation 2024 revenue being similar to 2023 revenue, you know, the revenue from these fast shipments, so the EUR 700 million, but also, you know, these tools that slip from 2023 into 2024, that's included in that expectation.

Speaker Change: Addition of capacity that we that we'd be talking about.

And that means that in our guidance, when we talk about our expectation 24 revenue being similar to 23 revenue, the revenue from these fast shipments, so the 700 million, but also these tools that slip from 2023 into 2024, that's included in that expectation.

Speaker Change: And that means that in our guidance when we talk about our expectation 24 revenue being similar to twenty-three revenue.

Speaker Change: The you know.

Speaker Change: The revenue from from the stack shipments of the $700 million and but also you know these these tools that have slipped from 2023 into 2024, that's included in that expectation.

Operator: Further to 2024, can you provide an initial outlook for the full year?

Further to 2024, can you provide an initial outlook for the full year?

Operator: Further to 2024, can you provide an initial outlook for the full year?

Further to 2024 can you provide an initial outlook for the full year.

Roger Dassen: Yeah, I mean, as we said last quarter, you know, clearly there is still uncertainty. There are uncertainties at the macro front. Also I think it's clear to see that our customers are navigating through, you know, through the downside of the cycle. They're really making that move right now. As a result of that, I think the question really remains as it was, as we expressed it last quarter as well, what's the shape of the recovery? Yes, recovery is there, but what's the shape of the recovery, and how fast is that recovery going to be? I think that's still unclear.

So yeah, I mean, as we said last quarter, you know, clearly there is still uncertainty. There are uncertainties at the macro front, and also I think it's clear to see that our customers are navigating through, you know, through the downside of the cycle. So they're really making that move right now. And as a result of that, I think the question really remains, as it was, as we expressed it last quarter as well, what's the shape of the recovery? Yes, recovery is there, but what's the shape of the recovery and how fast is that recovery going to be? And I think that's still unclear.

So yeah, I mean, as we said last quarter, there is still uncertainty. There are uncertainties on the macro front, and also, I think it's clear to see that our customers are navigating through, you know, the downside of the cycle. So they're really making that move right now. And as a result of that, I think the question really remains, as it was, and as we expressed it last quarter as well, what the shape of the recovery will be. Yes, recovery is there, but what's the shape of the recovery and how fast is that recovery going to be? And I think that's still unclear.

Speaker Change: So yeah, I mean, as we said last that last quarter. You know clearly there is some there is still uncertainty there are uncertainties at the macro front and also I think it's clear to see that our customers are are navigating through you know through the through to the downside of the cycle. So there are really making that move right now.

Peter T. F. M. Wennink: So they're really making that move right now. And as a result of that, I think the question really remains, as it was, and as we expressed it last quarter as well, what the shape of the recovery will be. Yes, recovery is there, but what's the shape of the recovery and how fast is that recovery going to be? And I think that's still unclear. That said, I do believe there are a few positive signs, and I think it is important to recognize those as well.

Speaker Change: And as a result of that I think the question really remains as it was as we expressed it last quarter as well, what's the shape of the recovery, yes recovery is there, but what's the shape of the recovery and how fast is that recovery going to be and I think that's still that's still unclear.

Roger Dassen: That said, I do believe there are a few positive signs, and I think it is important to recognize those as well. One positive sign is that we clearly see that the inventory levels in the end markets are improving and are definitely at a better level than they were a couple of quarters ago. There is clear improvement on the inventory situation in the end market. That's one positive development. Secondly, if we look at the utilization of our tools, we clearly see that they are improving.

That said, I do believe there are a few positive signs, and I think it is important to recognize those as well.

That said, I do believe there are a few positive signs and I think it is important to recognize those as well. So one positive sign is that we clearly see that the inventory levels in the end markets are improving and are definitely at a better level than they were a couple of quarters ago. So there is clear improvement on the inventory situation in the end market. So that's one positive development.

Speaker Change: That said I do believe there are a few positive signs and I think it is important to recognize those as as well. So one positive sign is that we clearly see that the inventory levels. In the end markets are getting are getting too or are improving and are definitely at a better level than we were a couple of quarters ago. So there is clear improvement on the on the inventory situation.

So one positive sign is that we clearly see that the inventory levels in the end markets are improving and are definitely at a better level than they were a couple of quarters ago. So there is clear improvement in the inventory situation in the end market. So that's one positive development. Secondly, if we look at the utilization of our tools, we clearly see that they are improving. They're not yet at what I would call normal levels, but they're clearly improving. And all the indications that we're getting are that we believe that that improvement will continue during the course of this year. So, good development there. And thirdly, clearly, the 9.2 billion order intake that we talked about earlier is also a clear positive indication.

Peter T. F. M. Wennink: So one positive sign is that we clearly see that the inventory levels in the end markets are getting to, are improving, and are definitely at a better level than they were a couple of quarters ago. So there is clear improvement in the inventory situation in the end markets. So that's one positive development. Secondly, if we look at the utilization of our tools, we clearly see that they are improving. They're not yet at what I would call normal levels, but they're clearly improving.

Speaker Change: Asian Indian market. So that's one positive a positive development.

Secondly, if we look at the utilization of our tools, we clearly see that they are improving. They're not yet at what I would call normal levels, but they're clearly improving. And all the indications that we're getting is that we believe that that improvement will continue to occur in the course of this year. So, good development there. And thirdly, clearly the 9.2 billion order intake that we talked about earlier on, I think, is also a clear positive indication. So, a few good data points, a few positive data points.

Speaker Change: Secondly, if we look at the utilization of our tools and we clearly see that they're improving they're not yet at what I would call normal levels, but it clearly improving and all the indications that we're getting is that we believe that that improvement will continue to occur in the course of in the course of this of this year. So.

Roger Dassen: They're not yet at what I would call normal levels, but they're clearly improving, and all the indications that we're getting is that we believe that improvement will continue to occur in the course of this year. A good development there. Thirdly, you know, clearly the EUR 9.2 billion order intake that we talked about earlier on I think is also clear, a positive indication. A few good data points, a few positive data points, but still we believe it's too early to revise our guidance. We would keep our guidance as we articulated it last quarter, which is that we believe that, you know, 2024 will be similar in revenue as 2023.

Peter T. F. M. Wennink: And all the indications that we're getting are that we believe that that improvement will continue to occur in the course of this year. So, good development there. And thirdly, clearly, the 9.2 billion order intake that we talked about earlier on is also a clear positive indication. So, a few good data points, a few positive data points.

Roger Dassen: Thirdly, you know, clearly the EUR 9.2 billion order intake that we talked about earlier on I think is also clear, a positive indication. A few good data points, a few positive data points, but still we believe it's too early to revise our guidance. We would keep our guidance as we articulated it last quarter, which is that we believe that, you know, 2024 will be similar in revenue as 2023.

Speaker Change: Good development, there and thirdly, you know clearly the $9 2 billion order intake that we talked about earlier on I think it's also clear positive positive indication. So feel good data points, a few positive data points.

So, a few good data points, a few positive data points. But still, we believe it's too early to revise our guidance, so we would keep our guidance as we articulated it last quarter, which is that we believe that 2024 will be similar in revenue to 2023. That said, we also set 2024 very much as a transition year and a year in which we're really building up capacity; we're making good investments in our capacity because we believe 2025 is going to be a year of strong growth, and that's what we're preparing for this year as well.

But still, we believe it's too early to revise our guidance, so we would keep our guidance as we articulated it last quarter, which is that we believe that 2024 will be similar in revenue as 2023.

Peter T. F. M. Wennink: But still, we believe it's too early to revise our guidance, so we would keep our guidance as we articulated it last quarter, which is that we believe that 2024 will be similar in revenue to 2023. That said, we also set 2024 very much as a transition year and a year in which we're really, you know, building up capacity; we're making good investments in our capacity because we believe 2025 is going to be a year of strong growth, and that's what we're preparing for this year as well. If we look at different elements in the composition of our revenue... I would say, if we look at the end markets, I would say that on the memory side, we believe that memory will be bigger than 2023 and 2024. And that's primarily because we see no transitions between them. And these transitions primarily support the increased demand for advanced DRAM. And then you should think about DDR5. You should think about high bandwidth memory.

Speaker Change: But still we believe it's too early to revise our guidance. So we would keep our guidance as we articulated that last quarter, which is that we believe that.

Speaker Change: 'twenty 'twenty four will be similar in revenue as 2023.

Roger Dassen: That said, we also set 2024 very much a transition year, and a year in which we're really, you know, building up capacity. We're making good investments into our capacity because we believe 2025 is gonna be a year of strong growth, and that's what we're preparing for in this year as well. If we look at different elements in the composition of our revenue, I would say if we look at the end markets, I would say that we believe on the memory side, we believe that memory will be bigger than 2023 and 2024. That's primarily because we see node transitions there.

That said, we also set 2024 very much a transition year and a year in which we're really building up capacity, we're making good investments into our capacity because we believe 2025 is going to be a year of strong growth and that's what we're preparing for in this year as well.

Speaker Change: That said, we also have 2024 very much a transition year and a year in which we're really you know building up capacity, we're making good investments into our capacity because we believe 2025 is going to be a year of strong growth and that's what we're preparing for in this in this in this year as well.

If we look at different elements in the composition of our revenue, I would say that if we look at the end markets, I would say that on the memory side, we believe that memory will be bigger in 2023 and 2024. And that's primarily because we see node transitions there. And these node transitions primarily support the increased demand for advanced DRAM. And then you should think about DDR5. You should think about high bandwidth memory. On the logic side, I would argue that we're looking at a small decline in comparison to 2023, primarily because of all the capacity additions that we've seen in 2023. I think it's fair to assume our customers will digest those capacity additions. So as a result of that, we believe that growth there will be a little bit smaller.

If we look at different elements in the composition of our revenue,

Speaker Change: If we look at different.

Speaker Change: Elements and the composition of our revenue.

I would say if we look at the end markets, I would say that we believe on the memory side, we believe that memory will be bigger than 2023 and 2024. And that's primarily because we see node transitions there. And these node transitions primarily support the increased demand for advanced DRAM. And then you should think about DDR5, you should think about high bandwidth memory.

Speaker Change: I would say if we look at the at the end the end markets.

Speaker Change: I would say that we believe on the memory side.

Speaker Change: We believe there will be there will be a that memory will be bigger than <unk> done in 2020, three and 'twenty 'twenty four and.

Speaker Change: And that's primarily because we see no transitions there.

Roger Dassen: These node transitions primarily support the increased demand for advanced DRAM. You should think about DDR5. You should think about high bandwidth memory. On the logic side, I would argue that we're looking at a small decline in comparison to 2023, primarily because of all the capacity additions that we've seen in 2024 and 2023. I think it's fair to assume our customers will digest those capacity additions. As a result of that, we believe that the growth will be a little bit smaller. If we then look at the different technologies, on EUV, we believe that we're looking at an increase.

Speaker Change: And these node transitions primarily support the increased demand for advanced DRAM and then you should think about DDR five you should think about high bandwidth high bandwidth memory.

On the logic side, I would argue that we're looking at a small decline in comparison to 2023, primarily because of all the capacity additions that we've seen in 2023, I think it's fair to assume our customers will digest those capacity additions. So as a result of that, we believe that there the growth will be a little bit smaller.

Peter T. F. M. Wennink: On the logic side, I would argue that we're looking at a small decline in comparison to 2023, primarily because of all the capacity additions that we've seen in 2023. I think it's fair to assume our customers will digest those capacity additions. So as a result of that, we believe that growth there will be a little bit smaller. If we then look at the different technologies, on EUV, we believe that we're looking at an increase. From a revenue unit number perspective, we believe we'll have approximately the same number of units of EUV in revenue, and that includes the things that we talked about earlier on, the fast shipment units, etc., are included in that estimate. But we will benefit in EUV from a higher ASP because we'll have a bunch of 3800s in our revenue with a higher ASP. And also will benefit from one or two EXEs, so the high innate tools that we'll have in revenue.

Speaker Change: On the logic side I would argue that we're looking at a small decline in comparison to 2023, primarily because of all the capacity additions that we've seen in 2023, I think it's fair to assume our customers will digest those capacity additions. So as a result of that we believe that there the growth will be.

Speaker Change: A little bit a little bit a little bit smaller.

If we then look at the different technologies, on EUV we believe that we're looking at an increase. From a revenue unit number perspective, we believe we'll have approximately the same number of units of EUV in revenue, and that includes the things that we talked about earlier on, the fast shipment units, etc., are included in that estimate.

If we then look at the different technologies, for EUV, we believe that we're looking at an increase. From a revenue unit number perspective, we believe we'll have approximately the same number of units of EUV in revenue, and that includes the things that we talked about earlier on, the fast shipment units, etc., are included in that estimate. But we will benefit in EUV from a higher ASP because we'll have a bunch of 3,800s in our revenue with a higher ASP. And also, we'll benefit from one or two EXEs or high-in-aid tools that we'll have in revenue. So I think for EUV, we expect an increase. As for non-EUV system sales, as a result of the flat guidance, we believe that we'll see a small decrease there.

Speaker Change: If we then look at the different a different technologies and on EV, We believe that that we're looking at a at an increase.

Roger Dassen: From a revenue unit number perspective, we believe we'll have approximately the same number of units of EUV in revenue, and that includes you know, the things that we talked about earlier on, the fast shipment units, et cetera, are included in that estimate. We will benefit in EUV from higher ASP because we'll have a bunch of 3800s in our revenue with a higher ASP. Also we'll benefit from one or two EXE, so High-NA tools that we'll have in revenue. I think for EUV, we expect you know, an increase.

Speaker Change: From a revenue unit number of prospective we believe will have approximately the same number of units of EV in and revenue and that includes the things that we talked about earlier on the fast shipments of units et cetera are included in that in that estimate.

But we will benefit in EUV from higher ASP because we'll have a bunch of 3,800s in our revenue with a higher ASP. And also we'll benefit from one or two EXEs or high-in-aid tools that we'll have in revenue. So I think for EUV we expect an increase. As it comes to non-EUV system sales, as a result of the flat guidance, we believe that we'll see a small decrease there. And that will be primarily related to immersion. So we expect to have less immersion sales in 2024 in comparison to 2023.

Speaker Change: But we will benefit.

Speaker Change: In E V from higher ESP, because we'll have a bunch of 38 hundreds in our revenue with the higher with a higher ASP.

Speaker Change: And also will benefit from from from from one or two E. Z. So high you need tools that we'll have in revenue. So I think for EV, we expect.

Peter T. F. M. Wennink: So I think for EUV, we expect an increase. As for non-EUV system sales, as a result of the flat guidance, we believe that we'll see a small decrease there, and that will be primarily related to immersion. So we expect to have fewer immersion sales in 2024 in comparison to 2023. And as for the install base business, we believe that that will be, you know, flat in comparison to last year. And then finally, in terms of the composition over the quarters, we believe that the momentum will build, you know, during the year 2024, and as a result of that, we expect that the sales level, the revenue level, in the second half will be higher than in the first half of 2024. What are your expectations for gross margin this year? Yes, so in 2023, we ended at 51.3% gross margin. We expect that this year it will be slightly below that number. A number of puts and takes are there again.

Speaker Change: And you know an increase as it comes to non EV system sales as a result of the flat guidance. We believe that we will see a small decrease there and that will be primarily related to two immersion. So we expect to have less immersion as sales in 2024 in comparison to 23.

Roger Dassen: As it comes to non-EUV system sales as a result of the flat guidance, we believe that we'll see a small decrease there, and that will be primarily related to immersion. We expect to have less immersion sales in 2024 in comparison to 2023. As it comes to installed base business, on the installed base, we believe that that will be, you know, flat in comparison to last year. Then finally, in terms of the composition over the quarters, we believe that the momentum will build, you know, during the year 2024.

And that will be primarily related to immersion. So we expect to have fewer immersion sales in 2024 in comparison to 2023. And as it comes to the install base business, on the install base, we believe that it will be flat in comparison to last year. And then, finally, in terms of the composition over the quarters, we believe that momentum will build during the year 2024, and as a result of that, we expect that the sales level, and the revenue level in the second half will be higher than in the first half of 2024.

And as it comes to install base business, on the install base, we believe that will be flat in comparison to last year.

And as it comes to installed base business on the installed base, we believe that that will be flat in comparison to two last two last year.

And then finally, in terms of the composition over the quarters, we believe that the momentum will build during the year 2024, and as a result of that we expect that the sales level, the revenue level in the second half will be higher than in the first half of 2024.

And then finally in terms of the composition over the quarters, we believe that the momentum will build.

You know during the year 'twenty 'twenty four and as a result of that we expect that the you know the sales level the revenue level in the second half will be higher than in the first half of 2024.

Roger Dassen: As a result of that, we expect that the, you know, sales level, the revenue level in H2 will be higher than in H1 of 2024.

Operator: What are your expectations for gross margin this year?

Speaker Change: What are your expectations for gross margin this year? Yeah, so in 2023 we ended at a 51.3% gross margin. We expect that for this year we'll be slightly below that number. A number of puts and take there again. I think if you look at EUV, we talked about the introduction of the 3800, so that would have a positive impact on the gross margin. And also we expect that the service gross margin for EUV will improve. So that's positive. But then, as I also mentioned, we'll have less immersion, and that will have a negative impact on the gross margin. And also, as we also mentioned in previous quarters, this really is an investment year as well. We're investing for the capacity expansion that we'll take benefits from in 2025. So, you know, significant investments there. And also we're very much investing in our capability, both in the factory and in the field as it relates to high NA. So those are drags, if you like, on the gross margin. And if you add it all up, we think that the gross margin for 2024 will be slightly below the gross margin for 2023. And what about your gross margin for 2025? As you know, for 2025, we gave an expectation at the Capital Markets Day of a gross margin range between 54% and 56%.

Operator: What are your expectations for gross margin this year?

Speaker Change: What are your expectations for gross margin. This year yeah. So in 2023, we ended at 51, 3% gross margin.

Roger Dassen: Yeah. In 2023, we ended at a 51.3% gross margin. We expect that for this year it will be slightly below that number. A number of puts and takes there again. I think if you look at EUV, we talked about the introduction of the 3800, so that would have a positive impact on the gross margin. Also we expect that the service gross margin for EUV will improve. That's positive. As I also mentioned, we'll have less immersion, and that will have a negative impact on the gross margin. Also, as we also mentioned in previous quarters, this really is an investment year as well.

Yeah, so in 2023, we ended at a 51.3% gross margin.

We expect that for this year we'll be slightly below that number. A number of puts and take there again. I think if you look at EUV, we talked about the introduction of the 3800, so that would have a positive impact on the gross margin. And we also expect that the service gross margin for EUV will improve. So that's positive. But then, as I also mentioned, we'll have less immersion, and that will have a negative impact on the gross margin. And also, as we've mentioned in previous quarters, this really is an investment year as well. We're investing in the capacity expansion that we'll take benefits from in 2025. So, you know, significant investments there. And we're also very much investing in our capability, both in the factory and in the field as it relates to high NA. So those are drags, if you like, on the gross margin. And if you add them all up, we think that the gross margin for 2024 will be slightly below the gross margin for 2023.

Speaker Change: We expect that for this year it will be slightly below that that number.

Speaker Change: A number of puts and takes there again I think if you look at <unk> at <unk> at <unk>, we talked about the introduction of their 3800, so that would have a positive impact on the on the gross margin and also we expect that the this service.

Peter T. F. M. Wennink: I think if you look at EUV, we talked about the introduction of the 3800, so that would have a positive impact on the gross margin. And also, we expect that the service gross margin for EUV will improve. So that's positive.

Speaker Change: Gross margin for a for UV will that will improve so that's positive, but and as I also mentioned, we will have less immersion and that will have a negative impact on the gross margin and also as we also mentioned in previous quarters. This really is an investment year as well you know we're investing for the capacity expansion that will take you know that will take benefits from.

Peter T. F. M. Wennink: But then, as I also mentioned, we'll have less immersion, and that will have a negative impact on the gross margin. And also, as we have mentioned in previous quarters, this really is an investment year as well. We're investing in the capacity expansion that we'll take benefits from in 2025. So, significant investments there. And also, we're very much investing in our capability, both in the factory and in the field as it relates to high NAs. So those are drags, if you like, on the gross margin.

Roger Dassen: You know, we're investing for the capacity expansion that will take benefits from in 2025. You know, significant investments there. We're very much investing in our capability, both in the factory and in the field as it relates to High-NA. Those are drags, if you like, on the gross margin. If you add it all up, we think that the gross margin for 2024 will be slightly below the gross margin for 2023.

Speaker Change: And the in the in 2025, so you know significant investments there and also a very much investing in our capabilities both in the factory and in the field as it relates to high <unk>. So those are drags if you like on the on the gross margin and if you added all up we think that the gross margin for 'twenty four would be slightly below the gross margin for 'twenty, three and what about your gross margin.

Peter T. F. M. Wennink: And if you add it all up, we think that the gross margin for 2024 will be slightly below the gross margin for 2023. And what about your gross margin for 2025? As you know, for 2025, we gave an expectation at Capital Markets Day of a gross margin range between 54 and 56 percent. And we still believe that that is the right window to look at. I recognize that's a jump from the gross margin that I just gave for 2024, but there are good reasons for that.

Operator: What about your gross margin for 2025?

Operator: And What about your gross margin for 2025?

Roger Dassen: As you know, for 2025, we gave an expectation at the Capital Markets Day of a gross margin range between 54% and 56%. We still believe that that is the right window to look at. I recognize that's a jump from the gross margin expectation that I just gave for 2024. There are good reasons for that. First off, of course, in 2025, if you look at the EUV mix, there will be substantially more, you know, high ASP tools in there than lower ASP tools in there. I think that's an important element in there.

Speaker Change: For 2025 as you know for 2025. We are we are we gave an expectation of the capital market today of a gross margin range between 54 and 56%.

As you know, for 2025, we gave an expectation at the Capital Markets Day of a gross margin range between 54% and 56%, and we still believe that that is the right window to to look at i recognize that's that's a jump from uh from the gross margin that's that i just the expectation that i just gave for for 2024 there are good reasons for that first off of course in 2025 if you look at the euv mix there will be substantially more um you know high asp tools in there than lower asp tools in there so i think that's an important element in there, Secondly, we'll have many more high-in-A tools in revenue in 2025 than in 2024, and they will be able to absorb the costs, better absorb the total costs that we have for high-in-A. And even more importantly, as I mentioned, we are building capacity for 2025, and of course, that should lead to, as we expect, higher sales levels for 2025, so many more outputs for EUV and DPV, and that means that we should, in 2025, really get the benefit of the investments that we make in 2024. And if we combine all of those dynamics, then indeed we believe that a 54% to 56% window for gross margin in 2025 is the right number to look at.

Speaker Change: and we still believe that that is the right window to to look at i recognize that's that's a jump from uh from the gross margin that's that i just the expectation that i just gave for for 2024 there are good reasons for that first off of course in 2025 if you look at the euv mix there will be substantially more um you know high asp tools in there than lower asp tools in there so i think that's an important element in there

Speaker Change: And we still believe that that is the right window to to look at I recognize that that's a jump from the from the gross margin that said that I'd just the expectation that I just gave for four of 'twenty 'twenty. Four there are good reasons for that first off of course in 2025. If you look at the mix that will be substantially more.

Peter T. F. M. Wennink: First off, of course, in 2025, if you look at the EUV mix, there will be substantially more high-ASP tools in there than lower-ASP tools in there. So I think that's an important element there. Secondly, we'll have many more high-in-aid tools in revenue in 2025 than in 2024, and they will be able to better absorb the total cost that we have for high-in-aid. And even more importantly, as I mentioned, we are building capacity for 2025, and that should lead to, as we expect, higher sales levels in 2025. So, you know, many more outputs for EUV and DPV, and that means that, you know, we should really get the benefit of the investments that we make in 2024. And if we combine all of those dynamics, then indeed, we believe that a 54 to 56% window for gross margin in 2025 is the right number to look at. We have just started the year.

Speaker Change: I E S P tools in there.

Speaker Change: Your ESP tools in there so I think that's an important element in there.

Roger Dassen: Secondly, we'll have many more High-NA tools in revenue in 25 than in 24, and they will be able to absorb, you know, the costs, better absorb the total cost that we have for High-NA. Even more importantly, as I mentioned, we are building capacity for 25, and of course, that should lead to, as we expect, higher sales levels for 25. You know, many more outputs for EUV and DUV, and that means that, you know, we should in 25, we'll get the benefit of the investment that we make in 24. If we combine all of those dynamics, indeed, we believe that a 54% to 56% window for gross margin in 25 is the right number to look at.

Speaker Change: Secondly, we'll have many more high-in-A tools in revenue in 2025 than in 2024, and they will be able to absorb the costs, better absorb the total costs that we have for high-in-A.

Speaker Change: Secondly.

Speaker Change: We'll have many more high any tools in revenue in twenty-five then in 'twenty, four and they will be able to absorb it.

Speaker Change: The costs better absorbed at the total cost that we have for heinie.

Speaker Change: And even more importantly, as I mentioned, we are building capacity for 2025, and of course, that should lead to, as we expect, higher sales levels for 2025, so many more outputs for EUV and DPV, and that means that we should, in 2025, really get the benefit of the investments that we make in 2024. And if we combine all of those dynamics, then indeed we believe that a 54% to 56% window for gross margin in 2025 is the right number to look at.

Speaker Change: And even more importantly, as I mentioned, we are building capacity for 25 and of course that should lead to a two as we expect higher a higher sales levels for twenty-five. So many more outputs for four <unk> and deep UV and that means that we should and twenty-five will get the benefit of the investments that we make in 'twenty four and if he can.

Speaker Change: Buying all of those dynamics than indeed, we believe that at 54% to 56% window for gross margin and 25 is the right number to look at.

Operator: We just started the year. What's your guidance for Q1 of 2024?

Speaker Change: We just started the year. What's your guidance for the first quarter of 2024?

Operator: We have just started the year.

What's your guidance for the first quarter of 2024? So for Q1, we expect 5 to 5.5 billion in sales in that quarter, with a gross margin expected to be somewhere between 48 and 49%. We expect installed base revenue of approximately 1.3 billion.

Peter T. F. M. Wennink: What's your guidance for the first quarter of 2024? So for Q1, we expect 5 to 5.5 billion in sales in that quarter, with a gross margin expected to be somewhere between 48 and 49%. We expect installed base revenue of approximately 1.3 billion.

Speaker Change: We just started the year, what's your guidance for the first quarter of 2024.

Roger Dassen: For Q1, we expect five to five and a half billion of sales in that quarter with the gross margin expected to be somewhere between 48% and 49%. We expect installed base revenue of approximately EUR 1.3 billion. That's a bit of a soft start for the year. That I think is very much in sync with what I told you earlier on, that we really believe that the momentum is building up throughout this year, and we expect that H2 will be better than H1.

Speaker Change: So for Q1, we expect 5 to 5.5 billion of sales in that quarter, with a gross margin expected to be somewhere between 48 and 49%. We expect installed base revenue of approximately 1.3 billion. That's a bit of a soft start for the year, but that I think is very much in sync with what I told you earlier on, that we really believe that the momentum is building up throughout this year, and we expect that the second half of the year will be better than the first half.

Speaker Change: So for Q1, we expect five to five and a half billion of of the sales are in debt in the quarter with a gross margin expected to be somewhere between 48, and 49%. We expect until installed base revenue of approximately $1 3 billion. That's.

That's a bit of a soft start for the year, but that I think is very much in sync with what I told you earlier on, that we really believe that the momentum is building up throughout this year, and we expect that the second half of the year will be better than the first half.

Peter T. F. M. Wennink: That's a bit of a soft start for the year, but that is very much in sync with what I told you earlier on, that we believe that the momentum is building up throughout this year, and we expect that the second half of the year will be better than the first. Sales to China were very strong in 2023. How do you see this developing in 2024? And can you give us an update on the most recent export control regulations and how they're impacting your business moving forward?

Speaker Change: That's a bit of a soft start for the year.

Speaker Change: But that I think is very much in sync with what I told you earlier on that we really believe that the momentum is building up throughout this year and we expect that the second half of the year will be better than the first half.

Operator: Sales to China were very strong in 2023. How do you see this developing in 2024? Can you give us an update on the most recent export control regulations and how it's impacting your business moving forward?

Speaker Change: Sales to China were very strong in 2023. How do you see this developing in 2024 and can you give us an update on the most recent export control regulations and how it's impacting your business moving forward?

Operator: Sales to China were very strong in 2023.

Speaker Change: Sales to China.

Speaker Change: Strong in 2023, how do you see this developing in 2024 and can you give us an update on the most recent export control regulations and how it's impacting your business moving forward. So if we write the business and in 'twenty three with their China was very very strong.

How do you see this developing in 2024, and can you give us an update on the most recent export control regulations and how they're impacting your business moving forward? So you're fully right; business in 23 with China was very, very strong. I should remind everyone that that was also driven by the fact that we already had many orders for assistance in China. And, you know, the majority of the sales that we had with China were actually based on orders that were already there by the end of 2022. I think we explained it last time. The order fill rate, typically for China, was fairly low. In the past couple of years, it actually was below 50%. So with the shifts in demand that we had with other customers, that meant that we were able to take advantage of the demand that was clearly there in China.

Roger Dassen: You're fully right. The business in 2023 with China was very, very strong. I should remind everyone that that was also driven by the fact that we already had many orders for systems into China. You know, the majority of the sales that we had with China was actually executing on orders that were already there by the end of 2022. I think we explained it last time. The order fill rate typically for China was fairly low. In the past couple of years, it actually was below 50%. With the shifts in demand that we had with other customers, that meant that we were able to execute on the demand that was clearly there in China.

Speaker Change: So you're fully right, the business in 23 with China was very, very strong. I should remind everyone that that was also driven by the fact that we already had many orders for assistance into China. And, you know, the majority of the sales that we had with China was actually executing on orders that were already there by the end of 2022. I think we explained it last time. The order fill rate typically for China was fairly low. In the past couple of years, it actually was below 50%. So with the shifts in demand that we had with other customers, that meant that we were able to execute on the demand that was clearly there in China. And that's why the China sales went up so significantly in this year. I should also say that, you know, those sales are really to mid-critical and mature for mid-critical and mature manufacturing. I mean, that's what the systems are going to.

Peter T. F. M. Wennink: So you're fully right, business in 2023 with China was very, very strong. I should remind everyone that that was also driven by the fact that we already had many orders for assistance in China. And, you know, the majority of the sales that we had with China were actually executed on orders that were already there by the end of 2022. I think we explained this last time; the order fill rate, typically for China, was fairly low. In the past couple of years, it was actually below 50%.

I should remind everyone that.

Speaker Change: That was also driven by the fact that we already have many orders for four systems into China and you know the majority of the of the <unk> of the sales that we have with China was actually executing on orders that were already there by the end of 2022 I think we explained last time the order fill rate typically for China.

Speaker Change: Was fairly low in the past couple of years actually was below 50% so with the shifts in demand that we had with other customers.

Peter T. F. M. Wennink: So with the shifts in demand that we had with other customers, that meant that we were able to execute on the demand that was clearly there in China. And that's why our Chinese sales went up so significantly this year. I should also say that, you know, those sales are really too mid-critical and mature for mid-critical and mature manufacturing. I mean, that's where the that's where the assistance is going.

That meant that we were able to execute on the demand that was clearly there in China and that's why the China sales went up so significantly in the in the in this in this year I should also say that those sales are really two two met critical and mature thoughtful metrocolor mature manufacturing I mean, that's what the that's what the that's what assistance are.

Roger Dassen: That's why the China sales went up so significantly in this year. I should also say that, you know, those sales are really to mid-critical and mature manufacturing. I mean, that's where the systems are going to. That demand remains very solid. It was solid last year. We expect it to be solid this year and also on a go-forward basis. Because of all the dynamics that are going on in China, we believe that that will remain solid. In terms of export controls, you're right. I mean, last year we had Dutch rules kicking in, and we had additional U.S. rules kicking in.

And that's why the Chinese sales went up so significantly this year. I should also say that, you know, those sales are really to mid-critical and mature for mid-critical and mature manufacturing. I mean, that's what the systems are going to do, and that demand remains very, very solid. It was solid last year, and we expect it to be solid this year and also on a go-forward basis because of all the dynamics that are going on in China. We believe that that will remain solid. In terms of export controls, you're right. I mean, last year we had Dutch rules kicking in, and we had additional US rules kicking in.

Speaker Change: Going to <unk>.

Speaker Change: And that demand remains very, very solid. It was solid last year. We expect it to be solid this year and also on a go-forward basis because of all the dynamics that are going on in China. We believe that that will remain solid.

Speaker Change: And that demand remains very very solid it was solid last year, we expect it to be solid this year and also on a go forward basis because of all the dynamics that are going on in China. We believe that that will remain it remains solid.

Peter T. F. M. Wennink: And that demand remains very, very solid. It was solid last year, we expect it to be solid this year, and also, on a go-forward basis, because of all the dynamics that are going on in China, we believe that demand will remain solid. In terms of export controls, you're right, last year we had Dutch rules kicking in, and we had additional US rules kicking in. We actually sought clarification with the authorities on the interpretation of those rules, and that really confirmed the expectation and the interpretation that we gave in our update on Q3. In essence, what it means is that we should now expect that for 2024, we will not get export licenses for shipment into China for, let's say, advanced immersion, so tools from 2000 and up.

Speaker Change: In terms of export controls, you're right. I mean, last year we had Dutch rules kicking in and we had additional US rules kicking in.

Speaker Change: In terms of export controls Youre right I mean last year, we had we had a Dutch rules kicking in and we had additional U S rules kicking in.

Roger Dassen: We actually sought clarification with the authorities on the interpretation of those rules, and, you know, that really confirmed the expectation and the interpretation that we gave in our update on Q3. In essence, what it means that we should now expect that for 2024, we will not get export licenses for shipment into China for, let's say, advanced immersion, so TWINSCAN NXT:2000i and up tools. And we should also expect for a handful of fabs, we should expect not to get export licenses for China for TWINSCAN NXT:1970i and TWINSCAN NXT:1980 immersion tools. That is the interpretation that we had in Q3, and we had that confirmed in follow-up conversations with the authorities.

Speaker Change: We actually sought clarification with the authorities on the interpretation of those rules, and that really confirmed the expectation and the interpretation that we gave in our update on Q3. In essence, what it means is that we should now expect that for 2024, we will not get export licenses for shipment into China for, let's say, advanced immersion, so 2000 and up tools. And we should also expect for a handful of fabs, we should expect not to get export licenses for China for 1970 and 1980 immersion tools. So that is the interpretation that we had in Q3, and we had that confirmed in follow-up conversations with the authorities.

Speaker Change: We actually saw clarification with the authorities on the interpretation of those rules and you know that that really confirmed the expectation and the interpretation that we gave in our update on Q3.

We actually sought clarification with the authorities on the interpretation of those rules, and that really confirmed the expectation and the interpretation that we gave in our update on Q3. In essence, what it means is that, for 2024, we will not get export licenses for shipment into China for, let's say, advanced immersion, so tools that are 2000 and up. And we should also expect that for a handful of fabs, we should expect not to get export licenses for China for 1970 and 1980 immersion tools. So that is the interpretation that we had in Q3, and we had that confirmed in follow-up conversations with the authorities. In terms of what that does, as you recall, we said in Q3 that we believed that between 10% to 15% of China sales in 2023 would be affected by this rule. So if you look at the impact that these export regulations that were articulated in 2023, the impact that that will have on 2024 sales, we confirm that we believe that will be somewhere between 10% to 15% of China system sales in 2023.

Speaker Change: What it means that we should now expect that for 'twenty 'twenty four we will not get the export licenses for shipment into China for let's say advanced immersion, so 2000 and up the op tools.

Speaker Change: And we should also expect for a handful of Fabs, we should expect not to get export licenses for a for China for 1970 in 1980 immersion tools. So that is the interpretation that we had in Q3 and we had that confirmed and in follow up conversations with the with the authorities.

Peter T. F. M. Wennink: And we should also expect that for a handful of FABs, we should expect not to get export licenses for China for 1970 and 1980 immersion tools. So that is the interpretation that we had in Q3, and we had that confirmed in follow-up conversations with the authorities. In terms of what that does, as you recall, we said in Q3 that we believe that between 10-15% of China sales in 2023 would be affected by this rule.

Roger Dassen: In terms of what that does, as you recall, we said in Q3 that we believe that between 10% to 15% of the China sales in 2023 would be affected by this rule. If you look at the impact that these export regulations that were articulated in 2023 will have on the 2024 sales, we confirm that we believe that will be somewhere between 10% to 15% of the China system sales in 2023.

Speaker Change: In terms of what that does, as you recall, we said in Q3, we said that we believe that between 10% to 15% of the China sales in 2023 would be affected by this rule. So if you look at the impact that these export regulations that were articulated in 2023, the impact that that will have on the 2024 sales, we confirm that we believe that will be somewhere between 10% to 15% of the China system sales in 2023.

Speaker Change: In terms of what it does and as you recall, we are we said on in Q3, we said that we believe that between 10% to 15% of the China sales in 'twenty two 'twenty three would be affected by by this fall. So if you look at the impact that these export regulations that depth adaptive are articulated in.

Speaker Change: 'twenty three the impact that that will have on the 24 sales we confirm that we believe that will be somewhere between 10% to 15% of the China system sales in 2023.

Peter T. F. M. Wennink: So if you look at the impact that these export regulations that were articulated in 2023, the impact that that will have on 2024 sales, we confirm that we believe that will be somewhere between 10-15% of the Chinese system sales in 2023. Can you update us on your capital allocation plan? Yes, we had a few soft quarters, but this was a strong quarter in terms of cash generation. So I think that was clear, and to a large extent, I think that was also related to the fact that we had significant order intake and, as a result, we had an uptick in down payments. The strategy, capital allocation strategy, and policy in and by itself hasn't changed, right? So we still have whatever cash we need in order to make the investments into the business, you know, for capacity, for technology, etc., etc., that's the first deployment of the cash.

Operator: Can you update us on your capital allocation plans?

Speaker Change: Can you update us on your capital allocation plan?

Speaker Change: Can you update us on your capital allocation plans.

Roger Dassen: Yeah. We had a few soft quarters, but this was a strong quarter in terms of cash generation. I think that was clear, and that, to a large extent, I think that was also related to the fact that we had a significant order intake, and as a result of that, we had, you know, an uptick in down payments. The capital allocation strategy policy in and of itself hasn't changed, right? We still, whatever cash we need in order to make the investments into the business, you know, for capacity, for technology, et cetera, that's the first deployment of the cash. Secondly, we have a policy of growing dividends, you know, and growing dividends which are paid out on a quarterly basis.

Speaker Change: Yes, so we had a few soft quarters, but this was a strong quarter in terms of cash generation, so I think that was clear, and to a large extent I think that was also related to the fact that we had significant order intake and as a result that we had an uptick in down payments.

Speaker Change: So you had a few soft quarters.

Speaker Change: But this was a strong quarter in terms of cash generation. So I think that was clear and that to a large extent I think that was also related to the fact that we had a significant order intake and as a result of that we had an uptick in down payments.

Speaker Change: The strategy, capital allocation strategy and policy in and by itself hasn't changed, right? So we still, whatever cash we need in order to make the investments into the business, you know, for capacity, for technology, etc., etc., that's the first deployment of the cash.

Operator: Can you please update us on your capital allocation plan?

Speaker Change: The strategy capital allocation strategy policy antibody chaff hasn't changed right. So we still whatever cash we need in order to make the investments into the into the business you know for capacity for technology et cetera et cetera, that's the first deployment of the cash.

Yes, so we had a few soft quarters, but this was a strong quarter in terms of cash generation, so I think that was clear, and to a large extent, I think that was also related to the fact that we had significant order intake and, as a result, we had an uptick in down payments. The strategy, capital allocation strategy, and policy, in and by itself, haven't changed, right? So we still, whatever cash we need in order to make the investments into the business, you know, for capacity, for technology, etc., etc., that's the first deployment of the cash. Secondly, we have a policy of growing dividends, which are paid out on a quarterly basis.

Speaker Change: Secondly, we have a policy of growing dividends, which are paid out on a quarterly basis. As it comes to this year, we will pay an interim dividend in Q1 of 1.45 euros per share. We will recommend to the AGM to declare a final dividend of 1.75 euros per share in the AGM and that would bring the total dividend for 2023 up to a level of 6.10 euros per share, which would be a 5.2% increase over last year's dividend.

Speaker Change: Secondly, we have a policy of growing dividends.

Speaker Change: And you know as it comes and growing dividends, which are paid out on a quarterly basis and as it comes through this year, we will pay a interim dividend in Q1 of one point 45 euros per share.

Roger Dassen: As it comes to this year, we will pay an interim dividend in Q1 of EUR 1.45 per share. We will recommend to the AGM to declare a final dividend of EUR 1.75 per share in the AGM, and that would bring the total dividend for 2023 up to a level of EUR 6.10 per share, which would be, you know, a 5.2% increase over last year's dividend. Whatever is left will be paid back to shareholders by way of share buybacks.

Peter T. F. M. Wennink: Secondly, we have a policy of growing dividends which are paid out on a quarterly basis. As it comes to this year, we will pay an interim dividend in Q1 of 1.45 euros per share, and we will recommend to the AGM to declare a final dividend of 1.75 euros per share at the AGM, and that would bring the total dividend for 2023 up to a level of 6.10 euros per share, which would be a 5.2% increase over last year's dividend.

Speaker Change: And we will we will.

Speaker Change: Recommend to the to the AGM to declare a final dividend of $1 75 euros.

Speaker Change: For sure.

Speaker Change: The NDA German that would bring the total dividend for 2023 up to a level of six point 10 euros or per share, which would be you know a five 2% increase over over last year's dividend.

As it comes to this year, we will pay an interim dividend in Q1 of 1.45 euros per share.

We will recommend to the AGM to declare a final dividend of 1.75 euros per share at the AGM, and that would bring the total dividend for 2023 up to a level of 6.10 euros per share, which would be a 5.2% increase over last year's dividend. And then, you know, whatever is left will be paid back to shareholders by way of a share buyback.

Speaker Change: And then, you know, whatever is left will be paid back to shareholders by way of share buyback.

Speaker Change: And then whatever is left will be paid back to shareholders by way of share buybacks.

Operator: Regarding your longer term outlook, what are your expectations on demand and your business beyond 2024?

Speaker Change: Regarding your longer-term outdoor growth, are your expectations on demand and your business beyond 2025?

Speaker Change: Regarding your longer term outlook, what are your expectations on demand and your business beyond 2024, So essentially unchanged I would say in comparison to what we are what we said last last quarter.

Peter T. F. M. Wennink: And then, you know, whatever is left will be paid back to shareholders by way of a share buyback regarding your longer-term out-of-good-area expectations for demand and your business beyond 2020. So, essentially unchanged, I would say, in comparison to what we said last quarter. So, you know, if we start looking at 2025, as I mentioned before, we are looking at a year of significant growth. And that is for a couple of reasons.

Roger Dassen: Essentially unchanged, I would say, in comparison to what we said last quarter. You know, if we start looking at, say, 2025, as I mentioned before, we are looking at a year of significant growth. That is for a couple of reasons. First off, we think the secular trends in our industry are still very much intact, right? If you look at the developments around AI, if you look at the developments around electrification, around energy transition, et cetera, they will need many semiconductors. We believe the secular trends in the industry are still very strong.

Speaker Change: So essentially unchanged I would say in comparison to what we what we said last last quarter. So we you know if if we start looking at 2025 as I mentioned before we we are looking at a year of significant growth and that is for a couple of reasons. First off we think the secular trends in our industry are still very much intact right if you look at the developments around AI if you look at the developments around electrification around energy transition etc they will need many many semiconductors. So we believe the secular trends in the industry are still very very strong.

Speaker Change: So we if we start looking at a 2025 and as I mentioned before we are looking at a year of significant growth.

Operator: Regarding your longer-term outdoor growth, are your expectations for demand and your business beyond 2025?

Speaker Change: And that is for a couple of reasons first off we think the secular trends in our industry are still very much intact right. If you look at the developments around AI. If you look at the developments around electrification around energy transition et cetera, They will need many many semiconductor. So we believe the secular trends in the industry are still very very strong.

So essentially unchanged, I would say, in comparison to what we said last last quarter. So we, you know, if we start looking at 2025, as I mentioned before, we are looking at a year of significant growth, and that is for a couple of reasons. First off, we think the secular trends in our industry are still very much intact. Right, if you look at the developments around AI, if you look at the developments around electrification, around energy transition, etc., they will need many, many semiconductors. So we believe the secular trends in the industry are still very, very strong. Secondly, I think we clearly should see our customers go through the up cycle. I mean the upward trend in the cycle, so that should be positive.

Peter T. F. M. Wennink: First off, we think the secular trends in our industry are still very much intact. If you look at the developments around AI, if you look at the developments around electrification, around energy transition, et cetera, they will need many, many semiconductors. So we believe the secular trends in the industry are still very, very strong. Secondly, I think we clearly should see, you know, our customers go through the up cycle, I mean, the upward trend in the cycle, so that should be positive. And thirdly, as we also mentioned last time, it's clear that many fab openings are scheduled that will require the intake of quite some tools in the 2025 timeframe. So, you know, we look at 2025 as a strong year of growth, and we are making the investments, as I also mentioned before, in 2024 in order to, you know, be able to create the capacity that will be needed in 2025 but also will be needed to cater to the demand that we talked about in the capital markets earlier on in 2030.

Roger Dassen: Secondly, I think we clearly, by 2025, we should see, you know, our customers go through the upcycle, I mean, the upward trend in the cycle. That should be a positive. Thirdly, as we also mentioned last time, it's clear that many fab openings are scheduled that will require the intake of quite some tools in the 2025 timeframe.

Speaker Change: Secondly, I think we clearly, by 2025, we should see our customers go through the up cycle, I mean the upward trend in the cycle, so that should be a positive. And thirdly, as we also mentioned last time, it's clear that many fab openings are scheduled that will require the intake of quite some tools in the 2025 time frame. So, you know, we look at 2025 as a strong year of growth, and we are making the investments, as I also mentioned before, in 2024 in order to, you know, to be able to create the capacity that will be needed in 2025, but also will be needed to cater to the demand that we talked about in the capital markets earlier on in 2030. So, we see strong growth, and we believe we need to prepare for that growth. And talking about capital markets, you can put it into your... into your calendar. We expect our next capital markets day to be on November 14th of this year. We look forward to seeing you there and discussing with you the good growth opportunities that ASML has for the foreseeable future.

Speaker Change: Secondly.

Speaker Change: I think we clearly by 'twenty twenty-five we should see you know our customers go through the through the up cycle.

Speaker Change: I mean that the upward trend in the cycle, so that that should be a positive and thoroughly as we also mentioned last time, it's clear that many fab openings are scheduled that will require the intake of quite quite some tools in the 2025 timeframe. So you know we look at 'twenty twenty-five as a strong a strong year of growth.

Roger Dassen: You know, we look at 2025 as a strong year of growth, and we are making the investments, as I also mentioned before, in 2024 in order to, you know, to be able to create the capacity that will be needed in 2025, but also will be needed to cater to the demand that we talked about in the Capital Markets Day earlier on in 2030. We see strong growth, and we believe we need to prepare for that growth. Talking about capital markets, you can put it into your calendar. We expect our next Capital Markets Day to be on 14 November 2024.

Speaker Change: And we are making the investments as I also mentioned before in 2024 in order to you know to be able to create the capacity that will be needed and twenty-five but also will be needed to cater to the demand that we've talked about in the capital markets day earlier on in the in 'twenty. Three so we see strong growth and we believe we need to prepare for that to for that growth.

And thirdly, as we also mentioned last time, it's clear that many fab openings are scheduled that will require the intake of quite some tools in the 2025 time frame. So, you know, we look at 2025 as a strong year of growth, and we are making the investments, as I also mentioned before, in 2024 in order to, you know, be able to create the capacity that will be needed in 2025 but also will be needed to cater to the demand that we talked about in the capital markets earlier on in 2030. So, we see strong growth, and we believe we need to prepare for that growth. And talking about capital markets, you can put it into your... on your calendar.

Speaker Change: And talking about capital markets.

Speaker Change: You can put them into Europe and into your calendar.

Speaker Change: We expect our next capital markets day to be on November 14th of this of this year. We look forward to seeing you there and discussing with you. The good growth opportunities that are that ASML has for our for the for the foreseeable future.

Roger Dassen: I really look forward to seeing you there and discussing with you the good growth opportunities that ASML has for the foreseeable future.

Peter T. F. M. Wennink: So, we see strong growth, and we believe we need to prepare for that growth. And talking about capital markets, you can put it on your calendar; we expect our next capital markets day to be on November 14th of this year. We look forward to seeing you there and discussing with you the good growth opportunities that ASML has for the foreseeable future.

We expect our next capital markets day to be on November 14th of this year. We look forward to seeing you there and discussing with you the good growth opportunities that ASML has for the foreseeable future.

Speaker Change: Yes.

Speaker Change: With regard.

Q4 2023 ASML Holding NV Earnings Call - Pre-Recorded

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