Natixis Technology Conference

Transcription

1 Natixis Technology Conference Marcel Kemp Director Investor Relations - Europe March 24, 2016

2 Forward looking statements This document contains statements relating to certain projections and business trends that are forward-looking, including statements with respect to our outlook, including expected customer demand in specified market segments including memory, logic and foundry, expected trends, expected liquidity and capital structure, expected levels of service sales, systems backlog, expected financial results for the first quarter of 2016 and expected sales trends in the second quarter, including expected sales, other income, gross margin, R&D and SG&A expenses and effective tax rate, annual revenue opportunity for ASML and EPS potential by end of decade, productivity of our tools and systems performance, TWINSCAN and EUV system performance (such as endurance tests), expected industry trends, statements with respect to expected system shipments, including the number of EUV systems expected to be shipped and timing of shipments and recognition in revenue and other EUV targets (including availability, productivity and shipments) and roadmaps, shrink being key driver to industry growth, the expected continuation of Moore's law and that EUV will continue to enable Moore s law and drive long term value, goals for holistic lithography, intention to return excess cash to shareholders, and statements about our proposed dividend, dividend policy and intention to repurchase shares. You can generally identify these statements by the use of words like "may", "will", "could", "should", "project", "believe", "anticipate", "expect", "plan", "estimate", "forecast", "potential", "intend", "continue" and variations of these words or comparable words. These statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about the business and our future financial results and readers should not place undue reliance on them. Forward-looking statements do not guarantee future performance and involve risks and uncertainties. These risks and uncertainties include, without limitation, economic conditions, product demand and semiconductor equipment industry capacity, worldwide demand and manufacturing capacity utilization for semiconductors (the principal product of our customer base), including the impact of general economic conditions on consumer confidence and demand for our customers' products, competitive products and pricing, the impact of manufacturing efficiencies and capacity constraints, performance of our systems, the continuing success of technology advances and the related pace of new product development and customer acceptance of new products, the number and timing of EUV systems expected to be shipped and recognized in revenue, delays in EUV systems production and development, our ability to enforce patents and protect intellectual property rights, the risk of intellectual property litigation, availability of raw materials and critical manufacturing equipment, trade environment, changes in exchange rates, changes in tax rates, available cash and liquidity, our ability to refinance our indebtedness, distributable reserves for dividend payments and share repurchases, and other risks indicated in the risk factors included in ASML's Annual Report on Form 20-F and other filings with the US Securities and Exchange Commission. These forwardlooking statements are made only as of the date of this document. We do not undertake to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. Slide 2

3 Welcome to where the magic happens ASML : Leading supplier in lithography equipment, a critical part of semiconductor manufacturing Slide 3 1/22/ ,681 employees ww 5,771 R&D engineers ww 95 nationalities 65,000+ m² net office space 50,000+ m² cleanroom space

4 Slide 4 Business environment Update on EUV Long term growth opportunity

5 highlights Record net sales of 6.3 billion, including record Service and Options sales of 2 billion, gross margin 46.1%, net income 1.4 billion and EPS 3.22 Slide 5 EUV: we met our 2015 productivity and availability targets and successfully started shipping NXE:3350B, our 4th generation EUV system DUV: successful ramping our TWINSCAN NXT:1980, our next generation immersion system, shipped 7 systems Holistic litho: continued adoption of these products with all our major customers Capital return: returned 867 million cash to shareholders through combined dividend and share buyback

6 Net Sales in M 2015 was another record sales year for ASML Service and options grew to 32% of the business Net sales by end-use , ,111 3, ,736 3, ,294 2, , , , , , ,252 2, ,489 1,614 1, ,050 1, ,225 2, Numbers have been rounded for readers convenience 1,596 4,508 5,651 4,732 5,245 5,856 6,287 Memory IDM Foundry Slide 6 Service & Options

7 Business environment Memory 2x nm DRAM node progressing, 1x nm node initial production starting Planar NAND shrink continues 3D NAND technology ramping New fab announcement for China One fab near completion and one fab equipment-ready by mid year X-Point architecture introduced and market opportunity being evaluated Slide 7 Multiple new foundry fabs accepting equipment in 2016 Continued demand for litho tools for several nodes Modest tool shipments continue for 28 nm and 16/14 nm nodes 10 nm foundry and MPU significant volume ramp starting in Q Logic Service & field options High demand for service and field options continues to be driven by Holistic litho, growing installed base and upgrade products which allows for improved process control and capital efficiency

8 System backlog in value Slide 8 Q4 15 total value 3,184 million New systems Used systems Units Value M 3, Q3 15 total value 2,880 million New systems Used systems Units Value M 2, Numbers have been rounded for readers convenience

9 Outlook Our guidance for Q1: Slide 9 Q1 net sales approximately 1.3 billion Gross margin around 42% R&D costs of about 275 million SG&A costs of about 90 million Other income (Customer Co-Investment Program) of about 23 million Effective tax rate for full year 2016 around 13% As we indicated 3 months ago, we expect logic customers to take shipments for ramping the 10 nm node starting Q2 As a result, we expect Q2 sales to increase significantly from Q1 level Numbers have been rounded for readers convenience

10 Slide 10 Business environment Update on EUV Long term growth opportunity

11 EUV targets and achievements 2015 achievements Productivity - Target: 1000 wafers per day More than 1000 wafers per day exposed on NXE:3300B at customer site, further improved to more than 1250 wafers per day on NXE:3350B at ASML More than 15,000 wafers exposed in four-week manufacturing readiness test at customer site 2016 targets 1500 wafers per day Slide 11 Availability - Target: 70% Majority of customer systems achieved four-week average availability of more than 70%; best result more than 80% over four weeks Overall annual average availability is lower, still needs to be improved 80% NXE: Target: 6 Two NXE:3350B systems shipped as of end-2015 One shipment in progress 6-7 NXE shipments (NXE:3300, NXE:3350, NXE:3400)

12 Wafers per day Wafers per day capability: multiple NXE:3300B above 1,000 NXE:3350B demonstrated 1,368 wpd NXE:3300B at customers NXE:3350B at ASML factory Slide 12 WpD: maximum number of wafers exposed in a 24 hr period NXE:3300B systems NXE:3350B ATP test: 96 fields, 20mJ/cm2

13 Total number of wafers exposed NXE:3300B productivity supports customer process development >300k wafers exposed on NXE:3300B at customer sites Slide , , , , , ,000 50,

14 Availability: capability beyond 75% proven on multiple field systems 2016 focus: reduce scheduled maintenance, reduce variability Slide 14 ~ 50% of downtime is scheduled down Best in class (over 14 days period) Maximum 4 weeks average realized in the field Uptime = productive time + standby time + engineering time

15 Run time (hours) Swap time (hours) Droplet Generator: ~2x improvements in run time, swap time Next generation DGen: demonstrated > 1 month lifetime capability Slide Swap time Gas Sn Filter Modulator Nozzle Type 1 Dgen (field) Type 2 Dgen (field) Q Q Q1 0 Type 3 Dgen (ASML)

16 New resist materials: towards 16nm resolution at full throughput best results show 19% EL, 4.4nm 18.5mJ/cm2 16nm Horizontal Dense lines/spaces NXE:3350 Reference CAR New formulation non-car New formulation CAR Slide 16 SEM Dose 40 mj/cm mj/cm 2 25 mj/cm 2 Exposure Latitude 16 % 19 % 16 % DoF 145 nm 125 nm 100 nm LWR 4.6 nm 4.4 nm 5.2 nm Exposures done on NXE:3350B system with Dipole90Y illumination. LWR: Line Width Roughness

17 Summary: EUV readying for volume manufacturing Completed qualification of five NXE:3350B, the 4 th generation EUV exposure tool, one system qualified at 75 wph Slide 17 Multiple systems demonstrated >1,000 wafers per day capability, with one system exceeding 1,350 wpd 80W configuration operational in the field, 125W configuration qualification completed 80% system availability capability demonstrated Excellent NXE:3350B imaging and overlay performance at> 80W power Continuous progress in resist formulation promising towards enabling 13nm half pitch at high throughput

18 Slide 18 Business environment Update on EUV Long term growth opportunity

19 Lithography is a key enabler of semiconductor shrink and the resulting cost reduction $2,305 for 1 GB Cost reduction through shrink Slide 19 Moore's Law: The capacity / functionality of each new chip doubles every months at the same cost Cheaper and smaller chips enable the introduction of new devices, which in turn drives market growth $0.17 for 1 GB Source: isuppli

20 ASML enables process evolution of electronic devices Slide iphone 2009 iphone 3G 2010 iphone 4 ipad 2011 iphone 4S ipad ipad iphone ipad iphone 5S ipad Air 2014 iphone 6/ ipad Air iphone 6S/6S+ APL nm APL nm A4 45nm A5 A5X A6 32nm A6X A7 28nm A8 20nm A8X A9 A9X 14/16nm XT:12X0 Shrink Add functions XT:14X0 Shrink Add functions XT:17X0I Shrink Add functions Add functions XT:19X0I Shrink Add functions Add functions NXT:1950Ai Shrink Add functions NXT:1960Bi Shrink Add functions Add functions NXT:1970Ci Shrink Add functions 72mm² 71.8mm² 53.3mm² 122.2mm² 169mm² 97mm² 123mm² 102mm² 87.4mm² 128mm² 96&104mm² 16 bit 1 Core 1 GPU 412 MHz 32 bit 1 Core 1 GPU 412 MHz Source: Chipworks 32 bit 1 Core 1 GPU 0.8 GHz 32 bit 2 Core 2 GPU 0.8 GHz 32 bit 2 Core 4 GPU 1.0 GHz 32 bit 2 Core 3 GPU 1.2 GHz 32 bit 2 Core 4 GPU 1.4 GHz 64 bit 2 Core 4 GPU 1.3 GHz 64 but 2 Core 4 GPU 1.4 GHz 64 bit 3 Core 8 GPU 1.5 GHz 64 bit 2 Core 6 GPU 1.5 GHz

21 The role of lithography in the value chain is enabling strong growth driven by innovation that continues shrink Slide 21 Annual growth World-wide GDP Revenues 2-3% growth* Electronics Manufacturing $2,100B+* (2016) 5-6% growth* - - Semiconductor Manufacturing $361B* (2016) ASML: ~10% growth Market share within litho > 80% Litho share of WFE ~20% High entry barriers, no alternative technologies * Source: IC Insights, VLSI Research ** Systems sales only ASML Nikon Canon $6B* / ** (2016) Continuous lower cost per function despite: Increased number of litho passes per wafer, and Higher cost per pass

22 Moore s law will continue to fuel demand growth Further penetration of current applications through new features and lower cost Smartphones, B units Tablets*, B units % p.a % p.a New applications are enabled by higher performance and lower cost Wearables, B units % p.a Slide Connected devices, B units Servers, M units # cores/server will also grow +3% p.a % p.a Source: Gartner Q4 15

23 ebay (4) Facebook (5) Alibaba (4) Tencent (4) Hitachi (5) Toshiba (3) FoxConn (5) Micron (4) ASML is part of an industry with considerable financial means, incentives to compete and drive for innovation... Slide 23 Top technology companies in our ecosystem (EBIT 2014, $B) ASML Semi Peers Other ASML (1.8) AMAT (1.5) LRCX (0.7) KLAC (0.8) TEL(0.7) Semi equipment (9) Semi manufacturers (16) TI (4) (8) SK Hynix (5) Semi design (10) Ericsson (3) (6) (53) Hardware manufacturers (9) (23) (28) Baidu (2) Yahoo (2) (17) (15) EMC (4) (6) (20) Software and services Source: McKinsey & Company Total EBIT 2013 = ~250 $B 2014 = ~275 $B

24 Storage Memory Working Memory Logic and to facilitate innovation, technology roadmaps are fully aligned with all key market players Slide 24 High Volume Manufacturing EUV ready for HVM nm 20nm 14/16nm 10nm 7nm 5nm 3nm DRAM 3xL 2xH 2xM Planar Floating Gate NAND 2xL 1xH 1xM 3D NAND 5x x24 5x x32 2xL 1xH 1xL 5x x48 ~ x64 1xM 1xL MRAM 1xM 5x x96 X-Point: ReRAM, CBRAM, PC-RAM 1xL Industry long-term roadmaps need strategic partnerships to succeed ASML key enabler of EUV EUV roadmap on track for High Volume Manufacturing in 2018/2019 Today s status Production Development Research Roadmap Node x # of layers 2x x8 1xM x8 1xL x8 Source: ASML, Customer roadmaps

25 The company is well on track to reach its 2020 ambitions 2014 (Actuals) 2015 (Actuals) By 2020 (Model) Net sales 5.9B 6.3B ~ 10B Gross margin % 44.3% 46.1% ~50% Driver Growing share of Litho; enabling cost affordable shrink in a growing industry EUV to corporate average Contributions from Service and Holistic Lithography Slide 25 R&D* % sales 18.3% 17.0% ~13% R&D growing much slower than sales SG&A % sales 5.5% 5.5% ~4% SG&A growing much slower than sales Effective Tax Rate 6.0% 10.4 % ~10% Innovation box in the Netherlands Cash Conversion Cycle 309 days 296 days <200 days Inventory turnover back to historical levels Capex % sales 6.2% 5.9% ~5% Continued infrastructure investments * R&D excluding Customer Co-Investment funding

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27 Capital return to shareholders Paid 302 million in dividend and purchased 565 million worth of our own shares in 2015 Propose to increase dividend by 50% to 1.05 per ordinary share Announcing new plan for share buyback program of 1.5 billion over 2016/2017, which includes approx. 500 million remaining of our prior program Slide 27 Dividend Share buyback proposed The dividend for a year is paid in the subsequent year Numbers have been rounded for readers convenience

28 All top semiconductor manufacturers rely on ASML Company Segment 2016 capex (est., $B) Foundry + Memory 11.0 Foundry 9.5 Integrated Devices 9.5 Memory 5.4 Memory 5.2 Foundry 3.8 Memory 2.8 Foundry 2.2 Others 1.5 Foundry 1.3 Others 14.6 Slide 28 Source: VLSI Research (2 February 2016) Total 66.8

29 ASML value is recognized by our customers Slide 29 Source: VLSI Research The Chip Insider (October 15, 2015) * Net Promotor Scoreˢ is a service mark of Bain & Company, Satmetrix System Inc., and Fred Reicheld Source: 2015 VLSI Research Customer Satisfaction Survey