(Bloomberg) — ASML Holding NV, awash in demand as countries race to build chip plants to prevent future supply issues, sees little impact from possible geopolitical disruptions in the Chinese semiconductor market.
(Bloomberg) — ASML Holding NV, awash in demand as countries race to build chip plants to prevent future supply issues, sees little impact from possible geopolitical disruptions in the Chinese semiconductor market.
In the unlikely event that “China would absolutely be excluded from any growth,” there’s still enough demand elsewhere, Chief Executive Officer Peter Wennink said Friday during the chip-equipment manufacturer’s Investor Day presentation.
“There could be a temporary hiccup but ultimately, those chips need to be made.”
Wennink said that any curbs on China wouldn’t significantly change the company’s 2030 outlook.
Propelled by surging global demand for chips, the Dutch manufacturer announced Thursday that it targets sales of as much as €40 billion ($41 billion) by 2025 and as much as €60 billion by 2030.
ASML is one of the very few producers of the sophisticated lithography machines needed to make midgrade semiconductors, and the manufacturer of an one-of-a-kind equipment needed to make the most cutting-edge chips.
In early October, Washington unveiled sweeping regulations to curb the sales of advanced semiconductors and chipmaking equipment to China, sending shockwaves through the $550 billion industry.
For now, ASML and other non-US chip production equipment companies face fewer hurdles in doing business in China.
ASML hasn’t been able to sell its most advanced extreme ultraviolet lithography machines to China as the Dutch government refused to give it a license to do so, but the company has been able to sell its other machinery to the country.
The Dutch company sees the total indirect impact from the new US measures to be about 5% of its backlog, it said on a call with investors in October.
Meanwhile, major governments around the world have come up with subsidies and incentives to expand chip production capacities at home to avoid another round of semiconductor shortages that shaved off hundreds of billions from their economies during the pandemic.
Even though the global chip industry is now facing a severe downturn, countries including the US and Japan have not slowed their pace in readying new plants to prepare for the next boom cycle.
Taiwan Semiconductor Manufacturing Co. is even considering adding another advanced facility next to a $12 billion dollar plant that’s under construction in the US state of Arizona.
Efforts by governments to build chip plants at home have just started and will accelerate, Wennink said Friday.
“The drive for technological sovereignty is going to be very important driver for our business going forward.”
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