Welcome everyone. This is Jim Kavanagh, Vice President of Investor Relations at ASML. Joining me today on the call are ASML CEO Christophe Fouquet and her CFO Roger Dasset. The subject of today's call is ASML's fourth quarter and full year results 2024. The length of this call will be 60 minutes and questions will be taken in the order that they received. This call is also being broadcast live over the internet on www.asml.com. A transcript of management's opening remarks and a replay of the call will be available on our website shortly following the conclusion of this call. Before we begin, I would like to caution listeners that comments made by management during this conference call will include forward-looking statements within the meaning of the Federal Security Laws. These forward-looking statements involve material risks and uncertainties. For a discussion of risk factors, I encourage you to review the safe harbor statements contained in today's press release and presentation found on our website at www.asml.com and in ASML's annual report on Form 20F and other documents as filed with the Securities and Exchange. With that I would like to turn the call over to Christophe Fouquet for a brief introduction.

Thank you Jim, welcome everyone and thank you for joining us for fourth quarter and full year 2024 Resource Conference Corps. Before we begin the Q&A session, Roger and I would like to provide an overview and some commentary on the fourth quarter and full year 2024 resource, as well as provide some additional comments on the current business environment and on our future business outlook. Roger? Thank you, Christophe, and welcome, everyone.

I will first review the fourth quarter and full year 2024 financial accomplishments and then provide guidance on the first quarter of 2025. Let me start with our fourth quarter accomplishments. In the fourth quarter of 2024, total net sales were 9.3 billion euros, which is above the high end of our guidance, primarily due to install base revenue. As expected, it also includes revenue recognition on two high NA systems. Net system sales were at 7.1 billion euros, which includes 2.9 billion euros from EUV sales and 4.2 billion euros from non-EUV sales. Net system sales was driven by logic at 61% with the remaining 39% coming from memory. Insole base management sales for the quarter were above guidance at 2.1 billion euros, primarily driven by additional upgrade business. Gross margin for the quarter was above guidance at 51.7% due to a combination of additional upgrade business and lower than plan costs associated with the new product introduction of high name systems in the field on operating expenses R&D expenses came at 1.116 billion euros in line with guidance while SG&A expenses came in above guidance at 318 million euros due to year-end payroll adjustments and a pull-in of IT costs the effective tax rates Q4 was 21.5% as a result of a one-off tax expense related to a historic tax position bring the full year etr to 18.6 percent 2025 we expect an annualized effective tax rate of around 17 percent net income in q4 was 2.7 billion euros representing 29.1 percent of total net sales and resulting in an eps of 6.85 euros Turning to the balance sheet, we ended the fourth quarter with cash, cash equivalents and short-term investments at a level of 12.7 billion euros. We ended Q4 with a free cash flow of 8.839 billion euros, which is significantly higher relative to last quarters, with the majority of cash coming in at the very end of the quarter. Moving to the order book, Q4 net system bookings came in at 7.1 billion euros, which is made up of 3 billion euros of EUV and 4.1 billion euros of non-EUV. Net system bookings in the quarter were driven by logic with 61% of the bookings with memory accounting for the remaining 39%. At this point I would like to briefly comment on the reporting of our bookings going forward. As we have said in the past, our order flow on a quarterly basis can be lumpy and does not necessarily reflect our business momentum accurately. Our sales guidance is primarily based on with all our customers as part of our planning cycle. With this in mind we will continue to report bookings on a quarterly basis through 2025 but will no longer report on bookings thereafter. As of 2026 we will report the total systems backlog on an annual basis. Looking at the full year Net sales came in at 28.3 billion euros, with a gross margin of 51.3%. EUV system sales realized from 44 systems, including high NA, were 8.3 billion euros, 9% lower compared to 2023. BPV system sales grew 4% to 12.8 billion euros. Ormetrology and inspection system sales increased 20% to 646 million euros. Looking at the market segments for 2024, logic system revenue was 13.2 billion euros, 17% lower than 2023. Memory system revenue was 8.6 billion euros, 44% higher than 2023. And install base management sales were 6.5 billion euros, 16% higher than 2023. We concluded 2024 with a net systems backlog of around 36 billion euros. In 2024, we continue to invest in innovation across our full product portfolio, increasing R&D spending to 4.3 billion euros in 2024, or about 15% of sales. SG&A increased to 1.2 billion euros in 2024, which was about 4% of sales. Net income for the full year was 7.6 billion euros, 26.8% of net sales, resulting in an earnings per share of 19.25 euros. In 2024, we generated free cash flow of 9.1 billion euros. We returned 3 billion euros to shareholders through a combination of dividends and share buybacks in 2024. With that, I would like to turn to our expectations for the first quarter of 2025. We expect Q1 total net sales to be between 7.5 billion euros and 8 billion euros. We expect our Q1 installed base management sales to be around 2.1 billion euros. Gross margin for Q1 is expected to be between 52 and 53%. This is primarily driven by a positive effect from no high NA revenue recognition in the quarter, partly upset by lower emergent volume. The expected R&D expenses for Q1 are around 1.14 billion euros, and FG&A is expected to be around 290 million euros. In Q4, ESML paid the second quarterly interim dividend over 2024 of 1.52 euros per ordinary share. Ismail intends to declare a total dividend for the year 2024 of €6.4 per ordinary share. The third interim dividend of €1.52 per ordinary share will be made payable on February 19, 2025. Recognizing this third interim dividend and the two interim dividends of €1.52 per ordinary share paid in 2024, This leads to a final dividend proposal to the general meeting of 1.84 euros per ordinary share. In Q4, 2024, no shares were purchased. With that, I would like to turn the call back over to Christophe.

Thank you, Roger. As Roger has highlighted, we finished 2024 with a strong quarter. We are extremely thankful to the whole ISML team that worked very hard to realize this In 2024, we have also successfully achieved a number of technology milestones, including the release of a number of new products critical for our customer technology on us. On our low NA EUV technology, the NXE3800E, we demonstrated the full system specification in our factory with 220 wifers per hour's throughput at a new record overlay. We are on track to deliver a new system at full specification and start upgrades for the system already at our customer during the first half of 2025. We continue to work with our customer to drive the maturation of the system to support their ramp to high volume manufacturing. On INA EUV, we completed installation and customer acceptance on two systems in Q4. Customers have now run over 10,000 wafers on INA systems, and their feedback has been very positive. They are seeing major performance benefit in imaging, overlay, and contrast, which also provides significant cost reduction opportunities for both logic and NIRAM processes. We continue to work with our customers to define the exact insertion point for INA in their processes. We also shipped a third system in Q4 that is now undergoing install and qualification. On Deep UV, we shipped the first NXT 870B, the latest generation KRF system, capable of throughput of over 400 wafer per hour, and the NXT 2150i, the latest generation immersion immersion DPUV system capable of achieving throughput over 310 with first per hours and overlay performance of equal or less than 1 nanometer. Finally, in application, after close collaboration with multiple customers, we have successfully completed the evaluation and recognized first revenue from a number of e-scan 1100 multi-beam inspection system. All in all, our product pipeline is really strong, supporting the roadmap requirements of our customer and driving our overall competitiveness. We will share more performance data at the SPIE lithography conference in February. Looking to 2025, we see full-year revenue between €30 billion and €35 billion, and gross margin between 51% and 53%. Consistent with our view from last quarter, artificial intelligence has become the key driver for growth in our industry at this moment. As we have witnessed in 2024, AI has created a shift in the market dynamics that is not benefiting all customers equally in the short term. If AI demand continues to be strong and customers are successful in bringing on additional capacity online to support the demand there is a potential opportunity towards the upper end of our ranch on the other hand there are also risks related to customers and geopolitics that could drive reserves towards the lower hand of the ranch looking at market segments we currently expect logic to be up versus 2024 with the ramp of leading-edge nodes while we expect memory to remain strong similar to 2024. With respect to our install base business we expect revenue to grow versus 2024 driven by both service and upgrades as part of a growing install base to which EUV contribution is continuing to grow. Our China business in 2023 and 2024 was relatively high because of our ability to execute on the backlog that was created after low order fill rates in previous years for 2025 and beyond we expect our china business to go back to a more normalized percentage of ourselves looking longer term overall the semiconductor market remains strong with artificial intelligence creating growth but also a shift in market dynamic as i highlighted earlier These dynamics will lead to a shift in the mix of end market products towards more HPC and HBM, which requires more advanced logic and DRAM. For ISML, we anticipate that an increased number of critical lithography exposure for these advanced logic and memory processes will drive increasing demand for ISML products and service. As a result, we see a 2030 revenue opportunity between €44 billion and €60 billion, with gross margin expected between 56% and 66%, as we presented in the Investor Day 2024. With that, we would be happy to take your question.

Thank you, Jose and Christoph. Operator will now instruct you all momentarily on the protocol for the Q&A session. Before, I would like to ask you to kindly limit yourself to one question with one short follow-up if necessary. This will allow us to get through as many calls as possible. Operator, could we have your final instructions and then the first question, please?

Thank you. As a reminder, to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We will now go to the first question. One moment, please. And the first question comes from the line of Joe Kittraki from Wells Fargo. Please go ahead.

Yeah, thanks for taking the question. I had a question on your 2025 outlook. You mentioned that if customers are able to build a capacity for AI, then you think you can hit the high end of your revenue guide. How do we think about that relative to your lead times? I know you've pre-built some EUV tools, but shouldn't we have a pretty decent idea kind of in the first half of this year if that high end of the target guide is possible?

Well, I think, you know, as we go into the year, I think that we'll have indeed more visibility on what the final expectation is going to be. I think right now we are in our supply plan taking into account some of the upside we see. So we are preparing for that. And I think you're getting it right. As time goes and these opportunities become more concrete or less concrete, we will decide to build or not build those stores.

Okay, that's helpful. And then in terms of the gross margin dynamics, you know, the cost of high NA installs this past quarter was a bit lower than expected. You know, as we look in the second half, and you talked about, you know, gross margin maybe being a little bit higher in the first half. How do we think about the expectations of just the cost of installing those tools in the first half relative to the kind of outperformance that you saw this past quarter? Is there any kind of update there?

Yeah, Joe. So, indeed, the costs were a little bit lower in the last quarter. But, you know, in coming up with our projections for, you know, for 2025, I would say that those learnings are also embedded in there. So we are recognizing in 2025 that we have lower costs. So I would still see that as a one-off benefit to the quarter. I wouldn't necessarily read into that that we're going to have significant savings that were not recognized when we provided the 51 to 53 percent guidance. But you are right. In the second half, we did say that we expect the gross margin to be a little bit lower because the revenue recognition on high A is to be skewed towards the second half.

Thank you.

Thank you. Your next question comes from the line of Tammy Q from Berenberg. Please go ahead.

Hi, thank you for taking my question. So, firstly, on high NA, since CMD, you have been mentioning that the progress at customers has been ahead of where you were expecting. So currently, of course, you are negotiating with them the timeframe, et cetera, but can you comment if there is any potential for them to use it quicker, because that helps them saving the cost of manufacturing?

Well, Tammy, this is Christophe. So I think that, you know, there's a few conditions for customers to use a new tool. like INA. The first one is the one you you repeated which is you know the performance have to be attractive, have to be good. I think that's most probably one requirement we check at this point of time. The second one is going to be the the maturity of the platform and there as you know we typically try to ship a few early tools. These are our 5,000 so that we can start to work aggressively on maturity. We are going to start shipping the 5200, which is a tool more fit to high-volume manufacturing. And then we'll have to spend a bit of time to demonstrate that the maturity of the tool is such that customers are comfortable to use it in production. So that process typically takes 12, 18 months. It depends a bit on where we start with the tool. And, you know, the discussion is a discussion we have, I would say, on a regular basis because, again, depending on the progress, of course, the appetite to move faster or slower is going to be adjusted.

Okay, okay, thank you. I guess I will circle back in the last month's time. And also, just in terms of China, so China, I noticed now they have been kind of pulling in some of the orders maybe because of the pending U.S. restriction, which is supposed to be implemented quite soon, I mean, a new wave. Do you actually see your customer pulling in their order? As a result, do you see China order decline quicker in the coming months because of everything has been pulled in? And also, I know that you mentioned in the pre-record video that China's expectation on U.S. and has been falling into expectation. So do you think there is potential for China to have some downside or upside in this year as you have everything clearer to you versus three months ago?

I think to be honest, our view on China hasn't really changed in comparison to when we last spoke. So when we last spoke, we said the key dynamic on China is that and why China was so very strong in 2023 and 2024 now. Because for a number of years, we have been building up a very significant backlog because of all the fill rates for China was so low. That is the reason why why the China sales in 2023 and 2024 was so high. And that is also the reason now that around this point in time where we have eaten significantly into that backlog, we say that backlog is being normalized. And that also means that we believe that the sales to China will be a more normalized percentage. And as we said, we think that it's a low 20% number that China will represent in 2025 in our total sales numbers. So that is what is going on. You know, the order intake that we received from China in the fourth quarter, I would call it healthy, but it's not, you know, an order intake that is, you know, in any way dramatic or skewed or whatever. That's not the case. It is, again, a relatively normal order intake for China. And therefore, I think the expectation that we articulated last time, China to be a more normalized percentage of our sales. I think that's what you will see in 2025 and, frankly, beyond.

Thank you.

You're welcome.

Thank you. Your next question comes from the line of Sarah Russo from Bernstein. Please go ahead.

Thank you very much for taking my question. So we've had quite a few conversations around your decision to phase out bookings information. And as we understand, it only provided backlog of you annually. can you talk us through the decision to do that and well I guess what are you expecting to be the reaction from investors and and and yeah you know is this a response to the increased focus you've been seeing on bookings that seems to be taking place over the last 12 to 18 months I think we we explained it in the in the video and just to recap where we are and the way we come up with our with our annual guidance is really based on on the review process that we have with our customers.

We have ongoing dialogues with our customers, and based on that, that gives us the insight into their business, and that gives us the basis to then articulate at the start of the year what we think the total sales level for the year is going to be. As you've seen in previous quarters, and as we have highlighted multiple times, order intake can be very lumpy, and that is because you know the the the total size of the orders per customers are pretty significant you know given the tool prices for high in a tools for low in a tools which as you know are pretty substantive you know if if orders if if customers take on a number of tools which they typically do you get to very very high numbers and that means that you have if you have a few large customers that plays an order in one quarter you know they typically wouldn't do it in one quarter and then get another massive order intake in the quarter thereafter. So as a result of that, you see sometimes very high order intake in one quarter and then lower order intake in other quarters. That does not necessarily reflect the business momentum that we enjoy. And that's why we think that the market is better off with us having a robust discussion and the robustly underpinned guidance that we provide at the beginning of the year, we think that is more meaningful than these swings in the order pattern that you've seen before. If you look at the past quarters, you do see that the market looks at these orders, and sometimes the reactions, both in terms of positive and in terms of negative order intake, the reactions can be quite significant. And that has been the reason that we say we have been telling the market that order intake is lumpy. We have been saying that it doesn't necessarily reflect the business momentum accurately. But we do see very significant market response to it. And as a result of that, we have reached a conclusion that maybe the market is better off with what I just gave you, including an annual update of the backlog. So from that regard, we came to the conclusion that less is actually more. You know, this is something that we discussed with quite a few of you. When we had the Investor Day, we discussed this quite extensively with many investors. And, you know, the conversations that we had there gave the confidence to Christophe, myself, and the full team that the decision that we just took is the right decision for the company and for its stakeholders.

Great. Really appreciate the additional context there. And then maybe just a quick follow-up. One of the pieces of guidance that you were talking about in the last of the results was, you know, you were probably at the bottom end for EUV bookings to see the low end of guidance. And since you've had a very strong quarter of bookings now, $3 billion of EUV, are you sort of more confident in the midpoint of guidance, or are you starting to see 2026 EUV orders come through as well, given the typical 18-month lead time?

Yeah, what we said last time is indeed that we needed about 2 billion of EUV orders to get covered for EUV on the midpoint of 2025. So, you know, with the 3 billion that we have in there, you know, we've reached that point. So it's clear that, you know, that we're either starting to build on 26, you know, or we're starting to build, you know, into the higher end of the guidance. But that really is the timing, is really that timing question that is dependent on it. But you are right. We said we need to get 2 billion order intake for EUV. And the fact that we, you know, that we have been recording three gives us, I would say, good confidence on the, at least for the EUV part on the midpoint.

On the EUV, we're not yet fully covered, but I think, you know, the coverage there is quite high for the midpoint of the guidance as well.

But, you know, as also Christoph mentioned, of course, there are always timing issues. And customers always have the ability, you know, during a year to either pull in or push out from the last quarter.

Great. Thank you very much.

Welcome.

Thank you. Your next question comes from the line of Francois Beauvigny from UBS. Please go ahead.

Thank you very much. My first question is, you see a strong demand for EUV logic driven by AI. Christophe, you mentioned in your video. presumably mainly from one last customer how do you think about the the capacity of two nano you know given it's going to be potentially a very significant node could we see a front loaded you know capacity build in a way that 25 will be a big build to prepare for 26 so in other words i mean how do you think about the phasing of this strong node as first year could be bigger and then you add on you know a bit less in 26 27 or is it going to be a really a granular build up well I think first was you know we don't have the details of

our customer ramp fully I think we we don't see any strange pattern in the ramps I think we we shared in the past the ramp is definitely starting in 25 will extend into 26 most probably into 2027 in fact with potentially you know a mix of two nanometer and some nodes. That's what we see, so no normal pattern. The other thing we mentioned in our commentaries is we see that maybe there is an opportunity to ramp a bit faster if the demand remains strong. So I think that's another discussion we're having with the advanced logic customer. But I think we don't see any kind of pattern that you described.

And, Francois, this was actually also confirmed by CCUA on the call that they had. So, he made specific comments on the RAM profile of N2. So, you might want to refer to that as well. That's what Christophe just said.

Thank you, Claire. I was wondering on the lead to maybe, but given the lead times. But, I mean, that's totally fair. Thank you for that. On the second question is, I mean, AI is very strong. Although, I mean, the market might have some doubts in the recent, you know, days. I'm not going to ask you, you know, the impact on DeepSeek on the demand for AI, but, you know, you described some upside on the AI potential if we get, you know, the capacity in the second half or, you know, if the demand still remains strong. But similarly, I mean, if you look at the iPhone or Apple or iPhone, which supposedly is a very significant part of your demand on the leading-edge nodes, But do you think AI is big enough to offset some downside in the, you know, if we see downside on the iPhone, at least in the short term? Because in the long term, you described at your CMD that, you know, it's centralizing. But I was more wondering in the short term, so 25, 26, you know, the dynamic of high AI and slower smart.

Well, I think in the short term, I think that we try to explain also with the upside. I think that the demand is strong to really drive, I would say, the utilization of whatever capacity would be built initially on advanced logic. I think, by the way, this will not be fully or so, mostly dedicated to AI. So I think, yes, the rest of the market is not doing spectacular, but it's still there. I think that I will also refer to the TSFC call where they were pointing also for the first time to some recovery on mobile. So I think nothing is spectacular there, but as you go for the ramp and you know that the ramp will build up capacity over time, so you don't get the peak capacity before quite a bit, I think we think this part is solid at this point of time. So we see more upside than risk, at least with all the elements we have at hand. Great. Thank you very much. You're welcome.

Thank you. Your next question comes from the line of Chris Sankar from TD Cowan. Please go ahead.

Yeah, thanks for taking my question. Christopher, Roger, the first question on the decline in China sales from 47% in September to 27% in December, is that all a function of digestion by Chinese customers since I'm assuming that the incremental export control rules did not impact you last quarter so I'm curious when do you expect this digestion to probably like you know meet a steady state or like you know bottom-out yeah I think rich we were already signaling in Q3 I think that that's that's you know that this trend might happen and I repeat what I just said on China I think this is the main reason why we're looking at a normalized percentage for China is the reason that I gave it that I gave

before so yes expert controls are a part of that but the lion's share of the reason for the normalization of the demand is what I said earlier which is that the eating into the backlog that was built up all the way through 22 is now coming to an end and now we're really seeing a normalized pattern got it got it another question on memory you kind of said that this here logic would be up but memory kind of flattish.

On the memory front you're more exposed to DRAM than NAND and you keep hearing about HBM capacity increase but it seems like you're not seeing better DRAM dynamics this year. Can you just tell us a little bit about what you're seeing in the memory ecosystem?

Well I think you're more surprised in your question. I think that high bandwidth memory is driving today I would say also an aggressive capacity addition at least for some of the customer. I think on the normal DRAM, I would say my comment is similar to the one on mobile for Phologi before. I think there was nothing spectacular, but there's some recovery, which also called for more capacity. So that's why we still see DRAM pretty strong in 2025.

Thanks, Roger.

Thank you. Your next question comes from the line of Chris Cazzo from Wolf Research. Please go ahead.

Yes, thank you. Good morning. I guess, and, you know, as I listened to you this morning, it sounds like a situation perhaps similar to how you started out last year, and correct me if I'm wrong, with, you know, some pretty good backlog coverage to start the year, and, you know, last year there were some changes at backlog in middle year, so I understand your prudence. I guess, one is that accurate depiction of what we're seeing here. And then secondly, what are the sort of plausible things that we should be watching for and concerned about that would justify the lower end of guidance? Is it export control restrictions? Is it China? Is it perhaps some of the concerns about AI? What are some of the scenarios which would sort of point you to the lower end.

Chris, let me take the first part and then Christoph can look at the second part. I'm not entirely sure I follow your logic on that we are today where we were a year ago. And also I would point out that a year ago we gave a guidance that I think we pretty much nailed during the year, right? So I think we delivered last year on exactly on the guidance that we provided in the year the reason why i think the situation is also not comparable is because last year we started the year saying we we think this year will be comparable to uh to 2020 to 2023 i think this year we start the year with you know with uh with a clear growth perspective uh at the midpoint uh somewhere somewhere around 15 so i don't think the situation is similar yes we have a strong yes we have a strong backlog yes we had a strong order intake in the last but I think you know Christophe discussed it on the call and he will provide the color and context now we see a clear path within that you

know within that within that guidance maybe you can yeah and I think on the the law and I think even Roger mentioned it already I mean we we have seen last year this was one of the low light of Q3 we've seen major push out of some of the capacity for some of the customer I think you know through our guidance this year we see that this risk is a lot lower in term of you know in term of volume but I think what you said it that's always possible so I think we are very transparent and we share with you the fact that you know if we look at the total dynamic that some of those push out may not be completely excluded that's what the final range so I think that's that's not more than that I would say geopolitics we also mentioned that there it's it's even more difficult of course to quantify because you know we just had a new export control being released so you know there's no expectation of anything on our side but this is also out of experience this this call a bit for prudence on our side so that that's a bit what we try to reflect in the lower hand of the guidance not more than that sure it's very helpful context thank you the inevitable you know kind of follow-on to that is you know how that affects the view for for

26 and you know given the lead times and the customer forecast you know imagine you have some degree of visibility now although it's very early um at this point would you expect 26 to be a growth year and and and you know what are the the variables that you're thinking about with regard to 26. yeah chris that's as much as we said you know we we are looking at 26 as a as a potential growth year for for a smell that that's that's how we look at it but it is exactly as you said it's way too early to provide any any direction or magnitude magnitude on that that's great. Thank you. You're welcome.

Thank you. Your next question comes from the line of Didier Simama from Bank of America. Please go ahead.

Yes, good afternoon, gentlemen. Thank you for taking my question. I wanted to go back to the order intake in EUV and DUV. So maybe first on DUV, can you maybe just help us understand how much of the DUV orders was related to DUV capacity build for the non-critical layers, e.g. non-China, or any color you can give us. And I'll have a follow-up on the EUV order breakout. Thank you.

Yeah, we typically don't disclose that, DG, as you know. We don't break down between customers or between regions.

But a significant part of the DPV order intake for the quarter was indeed related to larger customers and for larger customers for the non-critical layers as you mentioned it but i'm not we're not putting a percentage on that yeah perfect that's good to hear that it's confirmed on on the euv order intake uh obviously largely driven by uh by foundry logic well i think you said 50 50 perhaps earlier on um on the on the DRAM side and on the foundry side maybe any color you can give so um obviously on the foundry side you've got three major customers on the DRAM side you've got three major customers can you just obviously can't discuss the various customers sort of health but is there is there any change with regards to the trajectory of the various buckets e.g. is there any bucket looking a bit better it looks like DRAM is looking a bit better given the diversity of the of the of the customers in there would be sound really not changing very much but you know would be much more interesting hearing your views Well, I think we're looking at each other, but I don't know which one of us have to tell you first that, well, these are not the type of detail we share, because we would be even adding speculation on some of the market situation.

So the only thing I would say is, again, no major change compared to what we have discussed in the previous quarter. That would be my input to that question.

Okay. Well, I'll allow myself to follow up then. fair enough cannot blame you for trying you know French people on high NA just maybe give us a little bit of insight into that third shipment is that for a North American customer or is that also for maybe a Taiwanese or Korean customer that would be helpful I think we said it's not for the North American customer but we have not said and will not say where it went. Okay, I'll go back to the question. Thank you. I've tried. You did.

Thank you. Your next question comes from the line of CJ Muse from Cantor Fitzgerald. Please go ahead.

Yeah, good afternoon, good morning. Thank you for taking the question i guess first question in the video when you discussed your your 2025 outlook you talked about obviously ai supporting the high end other markets low end i would have thought you would have completely de-risked the other markets so can you touch on the level of de-risking embedded in your assumptions for those customers where you've seen pushouts to 26 and for the high end is there sufficient clean room space at those foundry and hbm customers to actually take tools by the Q4 time frame?

Yeah, I think on the first part, I think Roger indicated when it comes to booking, I think that mostly we have the risk, the large part of EOE. So the risk, I think I'm going to repeat myself on this one, but the risk is just on some potential push-out. I think that's what it is. So we're just a bit cautious based, again, on some of the experience we all went through last year. So that's the first part to your question. The second part, I think that's the right question. I think, you know, most probably today, you know, we're looking at opportunity to get more clean room space. I think that's what we mean by building up additional capacity. And if this is possible and if this happens, then we can most probably put some of our tools there. But that's exactly what we're looking at with our customers.

Very helpful. And I guess as a follow-up, you talked about the ongoing shift led by AI across HPC and HBM. And curious, you know, in your discussions with your customers across both those fronts, can you comment on kind of what you're seeing in terms of EUV layer counts, you know, whether it's A16 or whether it's going HBM 3E4, et cetera? I would love to hear kind of your thoughts on the trajectory there.

Well, I think we tried to explain that in November. So the need for a high-power computer, the need for a high-bandwidth memory, so basically the AI-driven chips are more demanding when it comes to advanced process. And I think what we said is we see those new products mostly calling for a bit of an acceleration of more slow, and therefore our customer being more aggressive when it comes to technology transition. I think in some extent, you see a bit of that already with two nanometers and mostly what will come after that. And I think we also said in November that historically, this has always driven more demand for advanced rethought. That's, of course, part of the discussion we are having as we speak with our customers. So, you know, part of the shift we see, I think that's one that we described as a positive one for us back in November. And I think when it comes to the trend, the trend is there. And, well, you're asking a very detailed question on, you know, future node. We don't have the detailed answer yet, but the trend is definitely there. Thanks so much. You're welcome.

Thank you. Your next question comes from the line of Andrew Gardner from City.

Please go ahead Good afternoon. Thanks for taking the question. I had another one on the customer visibility side of things It's encouraging obviously to see that you finished 2024 strongly in terms of orders But if I look at 2024 overall, you've had a fairly low level of orders from the logic community lowest since 2020 now i understand the multiple reasons why it's been weak in recent quarters so really i'm sort of interested in a more forward-looking view you've already explained that 2025 is essentially fully booked um but as i look to 2026 assuming growth as you've described loosely roger um is something like 30 to 40 percent booked for next year depending on one's assumptions And so then if I think of your lead times and the points you were making about the stated customer plans for their CapEx, the two nanometer migration, and in particular, the high volume ramp in the first part of next year, don't you need to see order commitments come in for EUV over the first half of this year in order to be able to meet those customer needs on time?

Yeah, Andrew, I think that's fair. So we should be seeing, you know, order intake in the first two quarters, particularly when it comes to EUV. I think that would be logical. As Christophe described, we do have flexibility, obviously, in the way we approach 2026. So we do have flexibility in our supply chain and also in our manufacturing capability. So it's not like, you know, at a certain point in time, that's where the music stops. But definitely we should continue to see good order intake in the first two quarters. I think that's a fair assumption.

I mean, related to your answer there, Roger, the strategy of pre-building, is that continuing? Have you changed that at all, given the shift in customer dynamics we've seen over the last six to nine months?

So really, we're doing this also, Andrew, to make sure that we have a level loading of our factory. And that's one. And second, in order to create sufficient flexibility for us. So we're reviewing that. We're obviously reviewing that based on the latest insights that we get from customers. I reiterate, you know, the ongoing discussions that we have with customers rather than just the POs. And based on what we get there and based on the insights that we get there for this year and for next year, that also determines what our pre-built strategy is. But, you know, that is an option that we continue to have and that we continue to use in order to, you know, to better optimize the loading of our factory.

Thank you very much. thank you your next question comes from the line of Mehdi Hussaini from SIG please go ahead yes sir thanks for taking my question two follow-ups Roger can you give me an update where we are with the throughput for NXE 3800E and where is it today and how are you going to close the year And then for the team, I want to better understand how you're planning internal capacity, especially looking beyond the 2025. When we had a strong cycle a couple of years ago, your backlog was in the $40 billion range. Do you see more flexibility with your capacity to bringing the lead times down, especially with higher EUV mix and concentration of customers, or would you be more prudent and try to build a longer backlog? I'm just trying to understand and balance your internal planning for the next couple of years versus your ability to get customers committed, especially given there is more concentration of customers for EUV.

Yeah, Matty, so on the throughput, the systems that we shipped in last year were all on a better throughput than the throughput of the 3,600, but not yet at the maximum throughput. That maximum throughput has been demonstrated, and we're now in the process of rolling that out. So the newer tools that we're now shipping to customers will gradually meet that specification. And for the tools that have been installed with the customers, we're going to make sure that in the course of this year, that those tools also meet that higher expectation. So, therefore, you will continue to see, you know, also us reporting on the improvement and also the revenue that we recognize from the fact that we get those higher throughputs achieved with customers and also get recognized for that. So, that's the status. So, the 220 has been demonstrated now in the process of holding that out for the new tools and also, you know, backporting that to the 3800s that are currently in the field. In terms of capacity beyond 2025, the key thing that we're doing is to make sure that what we call is the long lead time items that they are in place, i.e. that we have the flexibility to respond to higher demands and that we have the long lead time items that we have those in place. you know if you look at what we're projecting in terms of growth for the second half of this of this decade including what we're projecting for 2030 and it's clear that capacity needs to be built so the infrastructure um you know we we have already built and continue to do that so that the long that the infrastructure is in place and that then together with live chain and with our head count we can respond once we get the very clear signals from our customers that demand is is accelerating that's the way we that's the way we approach it so does that mean that the backlog would be kind of in the 18 month range or would you be are we going to go back to like 22 23 when backlog was extended due to supply constraints no that would that would not be I think a normal backlog is ultimately what we want to be able to offer to our customers we want to be able to offer to our customers a normal backlog because that will also help them respond to their business I mean that's ultimately what you want to get that customers have a backlog that is and they orderly time that is manageable for them and that allows them to respond you know in a good and flexible way to their demands of fluctuations and that's that's our ultimate goal and that's why we want to be as flexible as we can and that's why we we put in the infrastructure such that we are able to to give our customers a normal orderly time that's that's the objective that we are that we are driving good thank you for details you're welcome thank you your next question comes from the line of Stefan or II from Odo BHF please go ahead yes good afternoon I would like to

come back on the guidance for 2025 last quarter I think you gave us some some elements to rationalize how you could get to the to the middle of the range and you gave notably two elements one was on the non-uv non-china that was supposed to grow you know largely by the double digit let's say 50 percent so can you maybe come back on that and confirm if that's still what you expect and the second element was about the installed base management revenues that you said could be at about 7.5 billion but if you take the the first quarter where you

get for 2.1 billion it gives a run rate if you multiply by four of you know much much bigger than 7.5 8.4 8.5 so 1 billion above so is there any seasonality we should have in mind about installed base management thank you so let's take the last one first so the the 7.5 that's the number that we still include in or in our guidance and of course you know over the quarters you've also seen that last year there can be some fluctuation to a very large extent that's dependent on on on upgrades and so that fluctuates from one quarter to the other i would also say you know that or visibility into the upgrades is is of course less than than than the services than the service business but i think for now i would encourage to still use the seven and a half billion as the right as the right number when it comes to the non-china euv business i think you mentioned 50 i think that's on the higher end i think that's that's that's a little higher than than what i had in my model when we were having the when we were having the conversation so 50 is a little too high i think i think you probably want to i think we said it's sort of on par uh with uh with what you would see in the euv business and that would get you to approximately 40 to increase and and that's sort of where I think you're going to land.

And this isn't change, right?

What was that?

No, it's not a change. It's not changed. No, that has not changed. That is still consistent with the analysis that we provided to F2Q3.

Thank you very much.

You're welcome.

Thank you. Your next question comes from the line of Michael Rourke from Digoff Pertacam. Please go ahead.

Yes, good afternoon. um can i ask a question about one of your slides from the investor day 2024 we do all okay well now you're still up now you're still laughing um it's whoa it's a presentation by mr hartson danny slide number 13 and that is the slide with the seven end markets and the total semiconductor sales i'm sure you'll be able to visualize that one correct I have it in mind yeah yeah okay good well well first of all it's a pity that you no longer show the historical data which you did in the past so now my whole model is missing a few years but now my question is the following do you believe that your customers will be able to generate 1 trillion in sales in 2030 it's not a customers right that when you talk about the semi-conductor for customers there and that is precisely the answer I want to hear because the gardener market definition doesn't represent your customers it represents your customers the IDMs and the fabulous companies that are customers of your foundry customers yeah however if I look at these seven end markets then my perception is that the difference between vendor sales and manufacturer sales which is a huge gap for the total market that that difference is biggest for smartphone and data centers because that's where the IDMs have the smallest positions so you've changed all your scenarios with data center scenarios going up most other markets scenarios going down which optically looks great but from a manufacturer perspective I don't know if anything has changed actually to be honest I think you're losing a bit of the audience here and you're looking at a slide that no one else is looking at so I would I would suggest that we have a follow-on conversation on this perfect perfect however I you know what I'm talking about I'm surprised that everybody keep showing the Gartner data which are not a reflection of the equipment customers yeah I appreciate it but I think we have a we have a right we have the right follow-up action let's let's take it off like that then to one tiny follow-up then a whole different topic that's on the you will no longer show the quarterly bookings is perhaps a 12-month rolling booking figure or something that would be, you know, smoothing out all those lumpy intakes.

But to be honest, I think a backlog per annum gets you awfully close to that, right? Because if you have the backlog and you have the sales numbers for the quarters, I think it doesn't take you too much to kind of recalculate that. So I think by our- We only see it once a year, don't we? Yes, you do, yeah, yeah. And I think, as I explained before, we believe that's an important data point for you and good enough. Okay.

We'll take it offline. And then more questions about these slides will be in the next quarter and the one thereafter, because I've got many more questions.

Thank you. Appreciate that. We've got time for one last question. If you've been unable to get through on this call and fill up questions, please feel free to contact ASML Investor Relations with your question. Now, operator, can we have the last caller, please?

Thank you. Your last question today comes from the line of Sandeep Deshpande from J.P. Morgan. Please go ahead.

Yeah, hi. Good afternoon, and thanks for letting me on. I have a quick question as a follow-up on high NA. Christophe, you talked to a response to an earlier question that you will know in 12 to 18 months the timing of the insertion of high NA, but in terms of your backlog, I believe you already do have high NA tools in your backlog for shipment in 2026. So how do you put the two and two together that you will know whether the customer is going to use these tools in high-value manufacturing only later in the year or next year, but you're already possibly building these tools for the customer. So is there a risk that the customer says to you at the end of the year that, well, actually, we're not going to implement the tools into production next year and that these orders don't happen in 2026, which are there in the backlog today?

Well, I think you mentioned the backlog, and I think you know that indeed in our backlog we have quite a few tools that are not EXE 5000, which was a tool basically planned for R&D. So, indeed, our customers have, up front, already ordered some 5200, which are tools intended to be used in high-volume manufacturing. So, this means that the logic of insertion has been there for quite a while. You start with R&D, then you plan for, I would say, a reasonable insertion. So, those tools in the backlog are, indeed, going to support that. and I think we look at a few tools per customer which are sufficient basically to start going and that's what we call you know usually the first node insertion and after that of course when we look at new booking on INA we'll be most probably looking at the bigger insertion in the node after that which is a bit later but the logic you describe is the logic customer have put in place together with us already, in fact, a couple of years ago, and I think they are sticking to that logic today.

Since we've run out of time, I will leave it at that. Thank you so much.

Thank you. All right. And so now on behalf of ASML, I'd like to thank you all for joining us today. Operator, if you could formally close the call, that would be much appreciated.