Company Reports

ASM reported phenomenal results. Sales of EUR 1 billion were above the midpoint of guidance; revenue will accelerate 20% sequentially in the second half, and the medium-term demand outlook remains strong.

ASM International provides deposition wafer fab equipment. Despite lacking the product breadth and scale of peers like Applied Materials or Lam Research, ASM has carved out a strong position in atomic layer deposition, the fastest-growing, most advanced type of deposition, where it has more than 50% market share.

We raise our medium- and long-term revenue forecasts for ASM after a bullish first quarter provided more evidence that the semiconductor equipment upcycle is here to stay. The ceiling keeps being pushed higher, with artificial intelligence demand the core driver.

ASM International provides deposition wafer fab equipment. Despite lacking the product breadth and scale of peers like Applied Materials or Lam Research, ASM has carved out a strong position in atomic layer deposition, the fastest-growing, most advanced type of deposition, where it has more than 50% market share.

ASM International's fourth-quarter results brought a lot of positive read-throughs, including strong 2026 guidance, a China reacceleration, and management changing its wording on market share gains.

ASM International provides deposition wafer fab equipment. Despite lacking the product breadth and scale of peers like Applied Materials or Lam Research, ASM has carved out a strong position in atomic layer deposition, the fastest-growing, most advanced type of deposition, where it has more than 50% market share.

ASM management's comments confirmed our view that second-half 2025 will simply be a softer period due to order timing patterns, and bookings should gradually grow from here into 2026.

ASM International provides deposition wafer fab equipment. Despite lacking the product breadth and scale of peers like Applied Materials or Lam Research, ASM has carved out a strong position in atomic layer deposition, the fastest-growing, most advanced type of deposition, where it has more than 50% market share.

ASM’s investor day reaffirmed the company’s position as a structural winner, with management reiterating growth ambitions through 2027 and introducing new long-term guidance through 2030.

Wide-moat Nvidia and no-moat Intel announced a long-term collaboration for data center and PC products. European chip equipment shares were up on hopes this would be a step to revamping Intel’s foundry business. Arm Holdings’ shares are down 4%, given that this deal strengthens the x86 ecosystem.

ASM International's second-quarter results were below expectations, with weaker-than-expected orders of EUR 703 million, down 7% and 16% on a year-on-year and sequential basis, respectively. Investors were hoping for stronger orders and are now figuring out if 2026 revenue expectations are too high.

ASM International is a provider of deposition wafer fab equipment. Despite lacking the product breadth and scale of other wafer fab equipment providers like Applied Materials or Lam Research, ASM has carved out a strong position in atomic layer deposition, the most advanced type of deposition where it enjoys more than 50% market share. ASM has done this through more than two decades of research and development, which is now paying off as semiconductor transistors adopt new 3D structures and require more atomic layers. ASM’s management knows the deposition market is its strength and has made clear it will continue reinvesting in it, both through R&D and mergers and acquisitions, and stay away from other areas where the firm might lack competitive advantages. Fabricating advanced semiconductors becomes more complicated with each new generation, so we believe firms with high focus will have an edge.

The 2025 investor day confirmed our belief that Besi is a well-run, competitively advantaged company with a bright future ahead.

ASM International delivered EUR 839 million in revenue in first-quarter 2025, in line with the EUR 810 million-EUR 850 million guidance. New orders were EUR 834 million, up 14% sequentially and 19% year on year.

We have updated our view on semiconductor equipment makers ASM International and BE Semiconductor. Both firms have significant exposure to leading-edge semiconductors and are leaders in their respective segments.

ASM International is a provider of deposition wafer fab equipment. Despite lacking the product breadth and scale of other wafer fab equipment providers like Applied Materials or Lam Research, ASM has carved out a strong position in atomic layer deposition, the most advanced type of deposition where it enjoys more than 50% market share. ASM has done this through more than two decades of research and development, which is now paying off as semiconductor transistors adopt new 3D structures and require more atomic layers. ASM’s management knows the deposition market is its strength and has made clear it will continue reinvesting in it, both through R&D and mergers and acquisitions, and stay away from other areas where the firm might lack competitive advantages. Fabricating advanced semiconductors becomes more complicated with each new generation, so we believe firms with high focus will have an edge.

On April 2 the Donald Trump administration announced 20% tariffs on EU products, which sent shares of Dutch chip equipment makers ASML, ASM International, and Besi down 5%.

Narrow-moat ASM International met 2024 guidance reaching EUR 2.93 billion in revenue, but emphasized uncertainty heading into 2025. Management maintained its outlook and expects sales of EUR 3.2 billion to EUR 3.6 billion in 2025. The EUR 3.4 billion midpoint, where our estimate sits, would imply 16% year-on-year growth. We lift ASM’s fair value estimate to EUR 590 per share as we update our forecasts, with our fair value estimate representing a forward PE ratio of 37 and 31 times for 2025 and 2026, respectively. We see a compelling multiyear story in ASM, driven by above-average industry growth in the next decade. The shift to new 3D transistor structures will boost demand for atomic layer deposition in advanced logic and memory applications, benefiting ASM, which is the leader in ALD. Our 10-year revenue CAGR is 12.7%.

ASM International is a niche provider of wafer fab equipment. The firm has carved out a narrow moat and a solid competitive position in the semiconductor deposition market, more concretely in atomic layer deposition, or ALD, despite lacking the product breadth and scale of other wafer fab equipment providers like Applied Materials or Lam Research. ASM has done this through more than two decades of research and development, which is now paying off as semiconductor transistors keep shrinking and require more atomic layers. ASM’s management knows the deposition market is its strength and has made clear it will continue reinvesting in it, both through R&D and mergers and acquisitions, and stay away from other areas where the firm might lack competitive advantages.

We have consolidated our recent DeepSeek-related coverage in this note. Artificial intelligence affects companies across much of our coverage, including semiconductors, cloud infrastructure, software, utilities, and energy.