Story
ASML Signals Potential Price Hikes for Chip Equipment Amid Strong Demand
Summary
ASML's CFO indicated the company has room to raise prices on its semiconductor manufacturing tools, citing a nearly full order book for its advanced EUV systems through 2027.
ASML Holding N.V. (AS:ASML) has room to increase the prices of its semiconductor manufacturing equipment, the company's chief financial officer said Wednesday, citing robust demand that has nearly filled its production capacity for cutting-edge tools through the end of 2027.
Citing Strong Pricing Power
Speaking to analysts on a call following an earnings report, CFO Roger Dassen stated that the current market environment affords the company "better pricing power." He described "a pretty strong runway for potential price improvements going forward."
This confidence stems from the high demand for ASML's most advanced Extreme Ultraviolet (EUV) lithography machines, which are essential for producing next-generation microchips. Dassen confirmed that discussions regarding price adjustments are currently underway with customers.
AdCustomer Negotiations
While ASML projects confidence, negotiations with key clients may be complex. A report from tech news site The Information on Wednesday, citing people familiar with the matter, suggested that ASML was encountering resistance from major customer Taiwan Semiconductor Manufacturing Co. (TSMC) regarding price increases.
The same report indicated that some customers in China had already accepted a 10% price hike for ASML's less advanced Deep Ultraviolet (DUV) tool lines. ASML holds a near-monopoly on the high-end lithography systems required by the world's leading chipmakers, giving it significant leverage in supply negotiations.
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