07 February 2018Reading time: 2 minutes

During the fourth quarter of 2017, the revenue of ASML rose with 4.7% annually to EUR 2.6 billion. Also the net profit of the chip machine manufacturer increased over the same period with 15.6% to EUR 644 million. The gross margin over the last quarter of 2017 reached 45.2%. The revenue growth over the last quarter was mainly driven by the increased demand for chip machines. It seems that many clients have advanced their orders early. Companies such as Samsung notice an increase in the demand for semiconductors. Also the demand for the newest EUV-machines (Extreme Ultraviolet) of ASML is growing. With 28 placed orders, the company expects that this technology will finally be profitable in 2018. CEO Peter Wennink claimed that during the last period, ASML reached the breakeven point for the first time and that it is possible that they can make profit in 2018 on their new EUV technology.

For analysts as well as for ASML the fourth quarter results where above all expectations. Shareholders also profit of the proposed dividend increase of EUR 0,20 per share, which would bring the total dividend per share to EUR 1.40. The chip machine manufacturer also increased their already in progress share buyback program with another EUR 2.5 billion. Due to these positive developments the stock price of ASML has strongly risen.

It is striking that Intel has started selling its ASML shares in the past year. The American chip manufacturer built up a 15% interest in ASML for EUR 2.5 billion over the past five years. Halfway 2017 the Americans started with their first share selling session of 5.6%, which yielded EUR 3 billion. Recently they started a second share selling session of 4.6% which is expected to yield another EUR 3 billion. With these sales the investment in ASML would yield an total return of 140% for Intel.

For the first quarter of 2018 ASML expects a slight sales decline. For the remainder of the year, the revenue as well as net profit are expected to continue to grow. The company has set the target to reach an annually turnover level of EUR 10 billion by the year 2020. Throughout 2017 sales came out at more than EUR 9 billion. However, it remains to be seen if the stock price of ASML has reached the top for this year and if other shareholders will also sell their shares like Intel did.

Vontobel products on ASML are tradable at DEGIRO, Lynx and Interactive Brokers.

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18/02/2020 16:52:52