Dutch semiconductor equipment maker ASML announced third-quarter results that beat expectations, giving hope to analysts who think the industry is bottoming out and may be primed for a recovery next year.
The company, the world’s largest maker of lithography machines for manufacturing computer chips, said it earned €1.459bn ($2bn) in the third quarter, well above analysts’ consensus expectation of €1.39bn. Net profits were €335m, also beating expectations.
Bookings of new orders in the third quarter reached €514m, the company said. That represented a sharp drop from the second-quarter results, but was in line with company guidance and better than analysts had expected.
Growth in demand for computer chips has slowed, and orders for the equipment to manufacture the chips tend to be more sharply cyclical than the chip market itself.
Victor Bareno, an analyst at SNS Securities, said in a note that the results announcement “fully delivers on [ASML’s] reputation of being a defensive play in the sector,” but that it does “not necessarily call a bottom for the semiconductor equipment industry”.
ASML said it expects new orders to increase in the fourth quarter, and was well on target to meet its annual revenue target of €5.5bn. But it said the overall picture for the industry remained cloudy.
“It is too early to understand how overall demand for semiconductors will contribute to our business in 2012,” said Eric Meurice, chief executive, in a statement.
ASML’s shares rose 1.33 per cent to €26.91 in morning trading on the Amsterdam exchange, while the AEX index of shares stayed virtually flat.