Q1 2026 ASML Holding NV Earnings Call - Pre-Recorded

With you and ask you to give us a summary of our Q1 'twenty 'twenty six results for the quarter total net sales came in at 8.8 billion that was within our guidance included in the 8.8 billion was two and a half billion for installed base revenue that was a little bit above the guidance if.

If you look at the gross margin for Q1, 53% and that was at the high end of the gross margin that we that we guided.

If you look at the installed base business I just mentioned the installed base business was higher than we anticipated, but also if you look at the components in the installed base business that we're component in there that actually commended quite some strong gross margins as a result of that's pretty high gross margin is 53% net income for the quarter, a 2.8 billion.

Can you also provide us with a guide for Q2 'twenty six results. Please for Q2, we expect our 8.429 billion of total net sales included in there again, two and a half billion of installed base of business. We expect the gross margin to be between 51 and 50.

Two 2%.

Christopher can switch to you and can I ask you to give us an outlook on the market and how you're seeing things at the moment, where I think we see that the semiconductor industry growth continue to solidify this is still very much driven by investment in the infrastructure.

So this translate into a lot of demand for advanced memory for advanced logic, and we expect in fact that the supply will not meet the demand for the foreseeable future. So this is creating a strong constraint in the end markets from AI to mobile and PC.

And as the reserves are customer ice strongly invited to create more capacity. So.

So if we look at memory, what our customers tell us is that they all sold out for 2026 and there are supply constraints will last beyond 2026 for advanced logic, we see our customer building capacity for several nodes. While they also continued to ramp 10 nanometer in order to address the AI products.

Then I guess, it's fair to say a lot of those capacity additions are adding positively to our own outlook well, absolutely, we see over memory and logic customers, increasing their capital expenditure and trying to accelerate basically their capacity ramp in 2026 and beyond.

What's also very interesting is that a lot of these demand is supported by long term commitment of a customer.

On top of that we see boss memory customer DRAM customer in advanced logic customer continuing to increase their adoption of EV, but also immersion. So this translate basically into higher litho intensity and higher litho demand for ASML. So.

So we're going to continue to work very closely with our customer to increase our capacity. We're doing that in 2026, we'll continue to do that in 2027, and then maybe Rajiv just adding onto that can you provide a little bit more color or details on what we are actually going to do in terms of adding capacity to support market demand. So I think Christoph satirize what were very.

Clearly working with our customers fully align with customers to give them what they need and that is in a combination of capacity in terms of new shipments, making sure that our systems that the performance of systems is as upgrade its asbestos. We can also provide installed base of products and that combination we tried to give customers what they what they need specifically.

When it comes to our own our own capacity, what we're looking at for for this year of 'twenty 'twenty six we believe we can drive an output for this year of at least 60 60 systems.

For UV low in a yeah. That's what we currently have that's what we're currently driving.

And added.

Added to that we're looking at a deep UV for 'twenty 'twenty six.

As I mentioned.

Couple of months ago, when it comes to immersion deep UV, we actually had a bit of a slow start because in the course of last year, we decided to actually.

We're looking at a significantly lower demand for immersion that has now reversed itself and I would say in spite of that slow start. We're still you know for this year expecting to get pretty close to the immersion sales that we had last year in terms of in terms of unit numbers. So that's that's for 'twenty 'twenty six when it comes to 2027 in terms of Cape.

Ability.

We're increasing our move rate really quarter on.

Quarter on quarter, and then when you look specifically at easy low in a.

We expect that we're able to get to an output for 2027.

If a customer demands are really underpins that we think that we can get to at least 80, a low and a UV units and we're also looking at having the non elite.

<unk> being in line with what customers are asking for four four for all of their nodes.

And then specifically on 2026 can you give us an update then on our own business then for the full year. Yeah. So clearly at 25 six is a spanning out very nicely. It's a very strong year, we're looking at a strong strong growth here.

And based on all the customer dynamics that take Rostov Wassa was talking about.

We are actually narrowing the window and also increasing the window over expectation to 36 to 40 billion for this year. If you look at the different moving parts because we already expected EV strong. They said this year. So EU V in combination of low and a high and a strong year.

There.

On the non <unk> business previously, we're expecting that to be flat in comparison to last year right now what we're looking at is in fact, an increase of demand there as well so increased revenue on the non EV business is what we're at what we're expecting I already mentioned, what we're doing on immersion now but also the dry.

<unk> is doing quite nicely and also the application business. So we believe in contrast to what where we were a couple of months ago. We're looking at an increase for non EV business. When it comes to the installed base business.

Strong growth there because obviously it is a very fast way for our customers to increase their capacity to cater to the demand that Christophe was it was talking about.

And I would say that within the guidance that we provided the $36 billion to $40 billion. We believe we can accommodate the potential outcomes of the export control discussions that are currently ongoing and how about the gross margin then for 2026 for the gross margin, we maintain our expectation of 51% to 53%.

Switching gears a bit to technology Christoph can you give us some insights on latest updates on how we're progressing with the technology and our roadmap. Yes, I think we continue to execute very nicely on our technology roadmap I think earlier, we use the SBA conference to give a bit of an update to the entire wall.

About what we have achieved.

Hugh I think important news this year. The first one was a demonstration of the 1000 what source and this is very important because it means that we can secure the extensibility of our LOE in a UV for many many years. It means in fact that in 2031 would be able to run those two lots.

330, with a per hour, which is a major step up from what we have today.

Now the progress on UV also has a good impact on the short term.

We have been able to increase the throughput of our AR and X E 3800 E from 220 to 230 with the Perot's, which is also helping on the short term with capacity our customer are very happy to be able to get more with her out on any tool.

And we're also increasing the spec of our Nexus stent in the annex E 38 F. Two 260 with the paroles it used to be totaling 50 with the boroughs and this will help US also with capacity around 2028, and I think also what SP I E. There was some updates on our high and a platform progress can you share it.

Littler, Yeah, and I think what's was good about SBA is that our customers start to talk about <unk>.

And they reported a few think the first thing is of course, the fact that <unk> can allow them to reduce the number of masks significantly DRAM and logic customer, we're talking about going from free to one mask for UV using <unk> and he also mentioned that this can reduce the number of process steps from one <unk> to <unk>.

Ken which is of course significantly that's of course, the reason why we have irony.

We have seen also great progress on the ecosystem. Some good presentation with some of his partner pointing to the fact that I N E can be extended when it comes to logic to 18 nanometer line and space pitch and when it comes to memory to 28 nanometer or size, so which means basically that not only <unk>.

He is getting ready for prime time, but we already know that <unk> can be extended mostly for free for notes, which is of course very very important for customer.

And finally and maturity of the tool is important we continue to see better.

Really busy the data more wafer per day more with her out and this is just of course, becoming more and more important as we see our customers starting to test <unk> on real product. So I'd like to thank you both for joining us today and thanks.

Thanks very much.

[music].

Yes.

With respect.

With regard.