UPDATE 1-ASML has 16 orders for new tools, sees Japan deal
Thu Nov 17, 2005 12:07 PM ET
(Adds CEO comment on fourth quarter forecast, new orders, Japanese customer win, rivals)
By Lucas van Grinsven, European Technology Correspondent
BARCELONA, Nov 17 (Reuters) - Dutch chip equipment maker ASML Holding NV received more orders for its latest and most expensive machines, its chief executive said on Thursday, adding he expects a sixth Japanese customer.
ASML (ASML.AS: Quote, Profile, Research) (ASML.O: Quote, Profile, Research) , the world's largest maker of chip lithography machines which map out electronic circuits on silicon wafers, has eight firm orders in backlog for its latest immersion lithography machines that cost up to 30 million euros ($35 million) each.
There are orders pending for eight more, signed up in the last four to six weeks, Chief Executive Eric Meurice said.
ASML said order intake was on track with its forecast for stable units in the fourth quarter compared with the third, on the back of immersion and a cautious recovery of the chip sector fuelled by strong demand for cell phones, computers and other consumer electronics items.
In a presentation at a Morgan Stanley investor conference in Barcelona, Meurice said he expected to ship the first of the latest systems to a customer in the first quarter of 2006.
The system is the only chip lithography machine commercially available that can produce chips in the 45 nanometre specification, which enables much thinner circuits and hence smaller chips, or same-sized chips with more functionality.
Immersion refers to a water-like liquid between the lens and the silicon wafer, which allows higher depth of focus. This is the reason the circuits can be thinner than with traditional chip making lithography that uses no water.
As flash memories become more powerful, chip makers such as Samsung Electronics (005930.KS: Quote, Profile, Research) expect they will be used in new applications. These include personal computers, where they will enable instant switching on, because flash memory chips remember their data even when power is off.
"This is the gold rush, or the flash rush. Everyone in flash needs to go to 45 nanometres (and) if you want to play in immersion you have to come to ASML," Meurice said.
ASML reiterated it expects to ship 20 to 25 immersion tools in 2006, which are in great demand from makers of flash memory now used in cellphones and digital music players.
"We're getting more optimistic about the 20 to 25 immersion systems shipped in 2006," Meurice said.
There are still teething problems with the new technology that need to be ironed out.
NEW JAPANESE CUSTOMER
The lead in immersion over its two main rivals from Japan, Nikon Corp. (7731.T: Quote, Profile, Research) and Canon Inc. (7751.T: Quote, Profile, Research) , is delivering ASML new customers in Japan, a bastion where it has a market share of less than 10 percent, compared with its global share of more than 50 percent.
"Hopefully we can announce our sixth customer in Japan in the first quarter," Meurice said.
"We were astonished to receive a letter of intent without negotiations," he added. He declined to name the firm.
He said the accelerated penetration of Japan pointed to weakness of its rivals, but he could not gauge the magnitude. In any case, ASML would have to stop signing up new customers after number six as it could not support more, he said.
"We're going to fairly soon close our capability to do more in Japan," Meurice said.
The lens is the heart of a lithography machine and Meurice said that the first lens of the so-called Twinscan XT:1700 machine had been received and installed and that the first chip images were exposed just a day earlier. They delivered the big improvement that was hoped for.
ASML's customers include the world's largest chip maker Intel Corp. (INTC.O: Quote, Profile, Research) and Taiwan Semiconductor Manufacturing Co. Ltd. (2330.TW: Quote, Profile, Research) , the world's largest contract chip maker.
ASML shares closed 1.1 percent down at 15.38 euros, underperforming 0.2 percent higher Eurotech index .
Though it's probably premature for conclusions the 20% up quoted by Splinter appears to be in contrast to general consensus.
The very low portion of Korea (8% Samsung and Hynix) should leave room for growth.
Yahoo KLIC board pointed out MaxPain @ 17 for AMAT |
