Geoffrey Smith 

ASML (NASDAQ 🙂 posted another solid quarter, as global semiconductor bottlenecks continue to impede production. This led to ASML (NASDAQ :), a Dutch-based lithographer, to announce plans for increasing its capacity to produce high-end chipsmaking equipment.

ASML has a monopoly in machinery to make the best silicon chips. It stated that by 2025 it plans to increase its capabilities for deep ultraviolet (DUV), and extreme UV machines. Details will be provided in the second part. ASML’s stock rose by 2.7% after the announcement, making it one among the most successful local companies.

“We continue to see that the demand for our systems is higher than our current production capacity,” CEO Peter Wennink said in a statement. “In light of the demand and our plans to increase capacity, we expect to revisit our scenarios for 2025 and growth opportunities beyond.”

ASML is in an advantageous position due to the explosion in demand for semiconductors following the pandemic. There has been a surge of orders for new equipment. The net bookings for the quarter was 6.98 billion euro ($7.55billion), a fraction lower than the quarter before. The gross margin also fell slightly due to higher input costs but at 49% was in line with the company’s previous guidance.

ASML’s full-year guidance for 20% sales growth was reiterated. Current quarter sales are expected to be between 5.1 billion to 5.3 billion euro. A constant gross margin of 49% or 50% is anticipated. ASML expects to incur high research-and-development costs, with 790 million euros going towards research and the rest being spent on selling, general, and administrative expenses.

The quarter ended at 695 million euro, which is equivalent to 1.73 Euros per share.