By Toby Sterling
AMSTERDAM (Reuters) -Dutch computer chip equipment maker ASML said on Wednesday it expected new U.S. and Dutch export curbs to reduce sales of its mid-range “DUV” product lines to China by about 10% to 15% this year, after they hit record levels in 2023.
CFO Roger Dassen also confirmed that another older DUV tool not covered by Dutch licensing requirements would be directly restricted from China by U.S. rules, in some instances.
“We should now expect that for 2024 we will not get export licences for shipment into China for, let’s say, advanced immersion, so NXT:2000i and up, tools,” Dassen said, referring to Dutch licensing rules announced in June.
“And we should also expect for a handful of fabs not to get export licences for China for (older) NXT:1970i and NXT:1980i immersion tools,” he added, due to U.S. direct restrictions imposed in October.
It was the first public confirmation by the company that U.S. rules would apply to the lower-grade 1970i tool in its DUV series.
However, Dassen, speaking in a video released by the company, said he still expected demand from China for older equipment to stay “very, very solid”.
He added, “It was solid last year. We expect it to be solid this year and also on a go-forward basis.” Following a U.S.-led campaign to slow Beijing’s technological and military advances, ASML has been restricted from selling its most advanced EUV tool line in China since 2019 and has never sold an EUV tool there.
Yet China, usually ASML’s third biggest market, rose to second place in 2023, accounting for 29% of its sales, or more than 6.4 billion euros, as chipmakers there boost manufacturing capacity with government support.
CEO Peter Wennink said continuing Chinese demand for older chipmaking equipment should come as no surprise, given the number of chips it needs for everyday devices that need chips, as well as its large solar and electric vehicle industries, both of which require many older chips.
“They’re completely dependent on import,” he said in an interview with Reuters. “Of course they build their own” chip making plants. Taiwan, home of Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest and most advanced contract chipmaker, remained ASML’s biggest customer.
Taiwan was ASML’s largest market as usual in 2023, with a share of 30%, while South Korea ranked third with 24%, including Samsung Electronics and memory chip maker SK Hynix. Intel and Micron of the U.S. are also important ASML customers.
($1 = 0.9157 euros)
(Reporting by Toby Sterling; Editing by Louise Heavens, Clarence Fernandez and Ros Russell)