“China is unlikely to replicate cutting-edge lithography on its own, as ASML relies on relentless innovation and integration of components that can only be obtained from non-Chinese suppliers. But I don’t mean absolutely not. Maybe, because the laws of physics in China are the same as ours here. Never say never, they will definitely try." On January 19, local time, the CEO of Dutch lithography giant ASML (ASML) Peter Wennink said.
Lithography is the core link of chip manufacturing, and it is also the most difficult semiconductor equipment to develop. At present, ASML monopolizes the world's top lithography machine market, and the company is therefore regarded by the United States as a "political pawn" to contain the development of the chip industry in mainland China. While making the above statement, Peter Wen also revealed that ASML has not yet obtained a license to export the most advanced lithography machines to mainland China, but the export of some lithography machines with mature processes is not restricted.
Elvis Hsu, general manager of CINNO Research's semiconductor business unit, said in an interview with Observer.com that lithography machines account for about 25-30% of the highest price of semiconductor manufacturing equipment. The difficulty in research and development lies in the exposure light source, alignment system and light transmission. The integration of technologies such as lenses, as well as huge capital investment. At present, the leading manufacturer of lithography machines in China is Shanghai Microelectronics, which can stably produce lithography machines with 90/65nm manufacturing process.
The past 2021 is the year with the worst chip shortage in the world. As a supplier of key equipment for semiconductor manufacturing, ASML also showed a dazzling performance on January 19. According to the financial report, ASML’s total revenue in 2021 will be 18.6 billion euros (about 133.9 billion yuan), a year-on-year increase of 33%; net profit will be 5.9 billion euros (about 42.5 billion yuan), a year-on-year increase of 66%; The interest rate was 53%, 4 percentage points higher than a year earlier.
Peter Wen, CEO of ASML, said that 6.3 billion euros of revenue in 2021 will come from 42 EUV system (extreme ultraviolet lithography) orders, 11 more than the previous year. The company has experienced many challenges over the past year, with market demand 40% to 50% higher than maximum capacity. To improve customer support, the company opted to shorten lead times to ship more equipment, skipping some testing at the factory primarily through a fast shipping process, and conducting final testing and formal acceptance at the customer site. While this delays revenue recognition until official customer acceptance, it can help customers move to wafer production earlier.
Increasing the number of employees has also become ASML's method to cope with the increase in demand. The company plans to increase its workforce to 35,000 by the end of the year, up from the current 31,500, Peter Win said. He revealed that the company is adding more than 4,000 new employees on a net basis in 2021, and that by the end of 2022, the number of employees will be nearly 30% higher than at the end of 2020. However, Peter Win said it could take two to three years for the company to balance supply and demand. With the construction of new factories, the global semiconductor industry may even experience "some degree of oversupply" by 2025 or 2026.
From the fourth quarter alone, ASML achieved a revenue of 5 billion euros, a gross profit margin of 54.2%, and a net profit of 1.8 billion euros; new orders amounted to 7.1 billion euros. During the period, the company shipped a total of 82 lithography systems, an increase of 3 from the previous quarter; 11 of which were EUV lithography systems, a decrease of 4 from the previous quarter; 73% of the lithography machines were used in all shipments For logic process manufacturing, 27% of lithography machines are used for memory chip production.
In terms of shipment location, Taiwan, China is still ASML's largest market. In the fourth quarter, 51% of lithography systems were shipped locally, a 5% increase from the previous quarter; South Korea was the company's second largest market, with 27% of the lithography systems were shipped locally, a decrease of 6 percentage points from the previous month; Mainland China is ASML's third largest market, with 22% of the lithography systems shipped locally in the fourth quarter, a 12 percentage point increase. In the third quarter of 2021, the United States and Japan accounted for 10% and 1% of ASML's shipments, respectively, but the proportions in the fourth quarter were unexpectedly reduced to 0. The specific reason is unclear.
ASML has been developing high numerical aperture (0.55 NA) EUV lithography machines for the past few years. This EUV lithography machine adopts the latest optical design with higher resolution (upgrade from 13nm to 8nm), which can reduce the chip area by 1.7 times and increase the transistor density by 2.9 times. Compared with the current 0.33 NA EUV lithography machine, the 0.55 NA lithography machine can significantly improve the yield, reduce the cost and shorten the production cycle. Of course, the price of the 0.55 NA lithography machine is also quite expensive, each selling for about 300 million US dollars (about 1.9 billion yuan), which is twice the price of the 0.33 NA lithography machine.
At present, TSMC and other chips that produce 7nm-5nm process use 0.33 NA EUV lithography machines, while the first-generation 0.55 NA lithography machine TWINSCAN EXE: 5000 is still in the development process and is expected to be launched in 2023. As early as 2018, Intel took the lead in ordering the first-generation 0.55 NA EUV lithography machine from ASML, and the company is also expected to become the first user of high numerical aperture EUV lithography machine and use it for 3nm and below Process.
When disclosing the financial report this time, ASML revealed that the company received an order for TWINSCAN EXE: 5000 lithography machine in the fourth quarter of 2021, and the cumulative order reached 5. At the same time, the company also received its first order for the next-generation high numerical aperture EUV lithography machine TWINSCAN EXE:5200 in early 2022, which was placed by Intel. From the roadmap, TWINSCAN EXE: 5200 is expected to be put into use at the end of 2024 at the earliest, and will be widely used in the production of advanced processes of 2nm or below in 2025. An analyst abroad once said bluntly, "I bet that Intel spent a lot of money for this right, because he is definitely not the only company that wants to get this kind of machine first."
Looking forward to the performance of the new year, ASML expects its sales revenue in the first quarter of 2022 to be about 3.3 billion to 3.5 billion euros, down 30% to 34% month-on-month. Wen Peter explained that due to the large number of fast shipments, the expected revenue of about 2 billion euros will be shifted from the first quarter to the subsequent quarters, which is also the reason for the lower expected sales of the company in the first quarter. Looking at the full year, the company's 2022 revenue growth will still be around 20%, even taking into account that the current rapid shipment-related revenue of the six EUV systems will be shifted to 2023.
But this claim was questioned by Taiwanese semiconductor analyst Lu Xingzhi. He mentioned that in the fourth quarter of 2021, the revenue of ASML's memory chip lithography machines decreased by 12 percentage points from the previous quarter, and the EUV revenue confirmed in the same period was also lower than the original expectation. Random Access Memory) contract prices fell, demanding a delay in EUV payments to ASML. Because since it is fast shipping, in theory, it should also be paid quickly or on time, but now ASML fast shipping has been delayed in payment, how to explain it seems very strange.
Before the release of this financial report, a fire broke out at the Asmer Berlin factory. According to a report provided by TrendForce to Observer.com, the fire at ASML's Berlin plant in Germany will likely have a greater impact on the manufacturing of EUV lithography equipment for wafer foundries and memory. According to the information held by the agency, the parts needed by ASML cannot be ruled out through other factories. In addition, the current EUV equipment delivery time is quite long, so the actual impact on EUV supply remains to be seen. ASML also does not expect the Berlin fire to have a significant impact on its system shipments in 2022.
Since 2018, ASML has tried to sell EUV lithography machines to mainland China, hoping to further enter the Chinese mainland market, but the Dutch government has not approved its export license application. The request has been shelved by Dutch officials amid continued pressure from the United States. Wenningk said on the day of the earnings report that he was concerned about further export restrictions. "I'm concerned about export control measures by any government. We seriously lack mature semiconductor technology, we need mature manufacturing capabilities."
"Export control will speed up China's independent research and development, and they will make everything in 15 years", "After China fully controls the supply chain, European suppliers will completely lose the market", in fact, Peter Wen has publicly stated in April last year Anxiety, but America has always chosen to turn a blind eye.
