No reduction in demand, but still some changes in the delivery of new systems to their clients. President and CEO Peter Wennink expects ASML to be “limitedly impacted” by the Corona crisis. “Until now the COVID-19 outbreak has had a limited impact on ASML’s manufacturing capability. Also, from a customer point of view, we have not seen a reduction in the demand for our systems this year.”
Still, Wennink sees three COVID-19 related effects to impact the financial results. “First, we have experienced some delays in DUV shipments to Wuhan, China as well as to other customers due to shipment and travel restrictions regarding COVID-19. Second, we have experienced some issues in our supply chain, which for now have been solved. Third, due to concerns around the continued ability to ship systems in the current circumstances, some customers have asked us to expedite the delivery of EUV systems by shipping the systems before the normal Factory Acceptance Tests. The implication of this is a delay in our revenue recognition as final acceptance will now take place after successful installation at the customer site.”
ASML expects revenue in the first quarter to be between € 2.4 billion and € 2.5 billion, with a gross margin between 45% and 46%. “We expect the revenue that we were not able to recognize for Q1 as a result of the issues listed above, to shift to Q2 and Q3 of this year. Despite the challenging circumstances, we have been able to continue ASML’s operations although we, like many of our peers and customers, are dependent on future developments with respect to measures taken to control the COVID-19 outbreak around the world.”
Due to the uncertainties regarding COVID-19, ASML has decided not to execute any share buybacks in Q2 2020. This decision follows the pause in the execution of the program in the first quarter, after having already performed share buybacks under the new program for an amount of approximately €507 million. “The current coronavirus pandemic affects us all. Our primary goal is to ensure, as best as we can, that our employees and their families stay safe, whether they’re on ASML premises or at our customers, suppliers or partners. Our second goal is to ensure the continuity of our business and our customers’, suppliers’ and partners’ businesses, so that we can all continue to serve our end markets.”
Wennink promises to provide more information at the official presentation of the Q1 2020 earnings report on April 15, 2020.
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