Under the warm breeze of the industry, the demand for semiconductor equipment has begun to recover.
ASML, the global leader in lithography machines, submitted its Q2 financial report data today
In the second quarter, the company's sales reached 6.24 billion euros, a year-on-year decrease of 9.57%, a month on month increase of 18%, and an expected 6.03 billion euros; Net profit of 1.58 billion euros, expected to be 1.43 billion euros; The gross profit margin is 51.5%.
During the same period, the amount of orders in hand was 5.567 billion euros (including 2.5 billion euros for EUV equipment), a year-on-year increase of over 24% and a month on month increase of about 54%, exceeding analysts' expectations.
Similar to the previous quarter, China accounted for approximately half of ASML's Q2 sales.
The overall inventory level of the semiconductor industry is continuously improving, "said Fu Keli, President and CEO of ASML." Despite the uncertainty in the macro environment, we expect the semiconductor industry to continue to recover in the second half of the year and enter an upward cycle in 2025. We need to prepare for the large number of new wafer fabs currently under construction worldwide
Fu Keli referred to 2024 as the "transition year" as the company will further invest in expanding production and enhancing technology. "We see strong development in AI, which has driven the recovery and growth of most industries," said Quilter Cheviot analyst Ben Barringer. He believes that AI accounts for a "relatively small" proportion of ASML's revenue, but this part of revenue will increase significantly in the coming period.
However, it is worth noting that ASML expects sales of 6.7 billion to 7.3 billion euros and a gross profit margin of 50% to 51% in the third quarter of 2024. Due to a lower than expected outlook for the third quarter, ASML's stock plummeted in the European market after the release of its financial report, with a drop of over 4.7% as of press time.
As for A-shares, four semiconductor equipment companies have released semi annual report forecasts, with the highest increase in net profit attributable to shareholders even exceeding 1000%. Among them, Changchuan Technology, Northern Huachuang, and Huahai Qingke all set a new quarterly record high in net profit in the second quarter.
The performance data of domestic and foreign suppliers confirms the booming demand in the industry. The latest "Mid Year Semiconductor Equipment Forecast Report" released by SEMI also points out that the global semiconductor equipment sales are expected to reach a record high of $109 billion in 2024, and are expected to further grow to $128 billion by 2025.
Mainland China is the world's largest semiconductor market, accounting for approximately 29.5% according to SIA; According to data from semiconductor research firm Knoxeta Research, as of the end of 2023, mainland China's share of global wafer production is about 19%, of which only 11% comes from domestic enterprises in mainland China, and the rest is the production capacity built by foreign companies in mainland China. And the production capacity of local manufacturing enterprises is mostly mature technology, with a smaller proportion of advanced technology.
In this context, a report by CITIC Securities on July 11th pointed out that the domestic semiconductor industry has a huge capacity gap, and it is expected to continue expanding production in the long run, while the acceleration of advanced customer orders in the short term will bring more incremental growth. According to the expected expansion of domestic semiconductor wafer fabs, it is expected that the demand for semiconductor equipment will grow by over 20% in 2024; However, according to data from China International Tendering Network, it is estimated that the overall domestic production rate of semiconductor equipment in 2023 will only be around 20%. The localization rate of semiconductor equipment is expected to increase rapidly, and we continue to be optimistic about the rapid growth of orders from domestic semiconductor equipment companies in recent years.