[News] Despite U.S. Semiconductor Export Restrictions, ASML Reports Doubling of Revenue Share from China in 2023

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Despite the U.S. export control measures on semiconductor equipment, including those from the Netherlands-based ASML, a major player in advanced manufacturing tools, recent financial reports have contrastingly indicate a doubling of the revenue share from the Chinese market?

On January 24, ASML, a leading provider of photolithography equipment, released its latest financial results for the fourth quarter and the full year of 2023. In Q4 2023, the revenue reached EUR 5.683 billion, with China accounting for 39% of ASML’s total revenue. 

Although slightly lower than the 46% in Q3, the annual perspective for 2023 reveals that China contributed to 29% of ASML’s revenue for the year. This marks a significant increase compared to the 14% revenue share from China in 2022, indicating a direct doubling of ASML’s revenue share in the Chinese market.

ASML’s Chief Financial Officer, Roger Dassen, explained the significant increase in the revenue share from the Chinese market within a year during the interview accompanying the recent financial report. 

Dassen attributed the strong performance in China in 2023 to orders received at the end of 2022, which were executed throughout 2023. In the previous quarter, ASML had highlighted that the global order delivery rates, including the Chinese market, had been relatively low, below 50% over the past few years. 

He then emphasized that the demand from Chinese orders primarily comes from mid-critical and mature manufacturing, and this demand remains solid.

With the Netherlands imposing new restrictions on the export of advanced chip manufacturing equipment effective from January, ASML officially announced that starting from 2024, they would not be able to ship NXT:2000i and higher DUV lithography equipment to China.

Equipment below NXT:2000i, including NXT:1970i and NXT:1980i, would also be restricted from shipment to advanced process fabs in China. Dassen anticipated that this will impact 10% to 15% of sales in the Chinese market in 2024. However, he emphasized that this aligns with the financial forecasts provided in the third quarter of last year, and the demand for mature manufacturing processes remains robust.

For the full year of 2023, ASML reported a net sales revenue of EUR 27.6 billion, with a net income of EUR 7.8 billion and a gross profit margin of 51.3%. ASML estimates that the net sales for 2024 will be similar to those in 2023.

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(Photo credit: ASML)