UPDATE 7-ASML Q3 profit beats forecasts, sees record orders

* Q3 net profit 269 million euros, vs forecast 246 million

* Sees Q4 sales of 1.3 billion euros

* Q3 new bookings short of forecasts

* CFO sees 2010 sales at 4.2-4.3 billion euros

* Share up 3.9 percent

(Adds Commerzbank price target cut, updates shares)

By Marcel Michelson

AMSTERDAM, Oct 13 (BestGrowthStock) – Dutch chip-equipment maker
ASML (ASML.AS: ) beat forecasts with a big rise in third-quarter
profit after riding a surge in demand and said it should end the
year with a record order book, boosting its shares.

“We will end 2010 with a record backlog. That is a good
starting point, 2011 has the potential to be another growth
year,” chief financial officer Peter Wennink said on Wednesday.

He expected the world’s largest maker of semiconductor
lithography machines used to put electronic circuits on chips to
have 2010 sales of 4.2-4.3 billion euros ($5.8-$6.0 billion).

Overnight, the world’s biggest chipmaker Intel (INTC.O: ), a
major ASML customer, forecast upbeat fourth-quarter sales and
margins. [ID:nN11136922]

ASML said third-quarter net income jumped to 269 million
euros from 20 million a year earlier to beat all forecasts in a
poll in which the average was 246 million euros. [ID:nLDE696134]

ASML, which has a world market share of over 70 percent and
Japanese groups Nikon Corp (7731.T: ) and Canon Inc (7751.T: ) as
main rivals, said net bookings totalled 60 units versus an
expectation for 63, while bookings for new systems, at 42, was
below an expected 50 units. [ID:nBw127744a]

Its shares were up 3.9 percent to a nine-week high at 22.94
euros by 0915 GMT, while the STOXX Europe 600 Technology Index
(.SX8P: ) was up 1.9 percent.

Commerzbank cut its price target to 25 euros from 30.


Graphic on ASML net bookings vs. share price:



For the fourth quarter, ASML saw sales of 1.3 billion euros
and expected a gross margin of 44 percent, with research and
development spending of 140 million and selling, and general and
administrative costs of 50 million.

Analyst Jos Versteeg at Theodoor Gilissen said while new
orders fell short, the selling prices were good and the
fourth-quarter guidance positive. He said there would be further
growth in 2011 but he expected a sales decline in 2012.

ASML’s earnings before interest and tax (EBIT) surged to 309
million euros from 290 million in the second quarter and 38.6
million a year ago, and ahead of a forecast 301 million.


ASML’s biggest customers include Intel Corp and Taiwan
Semiconductor Manufacturing (2330.TW: ). ASML said the average
selling price was 20.1 million euros versus an expected 23.1
million and the 19.1 million of the third quarter of 2009.

The order backlog was 2.69 billion euros, or 110 systems, up
from a second-quarter backlog of 2.40 billion or 101 systems.

Due to a drop in investment in chipmaking facilities during
the downturn there was a supply bottle-neck during the start of
the recovery and some industries, like the automobile sector,
lacked the complex chips needed to meet consumer demand.

The growing popularity of mobile phones such as the iPhone
of Apple (AAPL.O: ), the BlackBerry from Research in Motion
(RIM.TO: ) and e-readers such as the Amazon (AMZN.O: ) Kindle or
Ipad, also demanded a fresh stream of chips.

Samsung Electronics (005930.KS: ) gave weaker-than-expected
earnings guidance amid falling prices. [ID:nSGE6950NV]

Chief executive Eric Meurice said the group had shipped the
first of a second-generation extreme ultraviolet (EUV) exposure
system with an imaging capability close to 20 nanometres and
allowing for smaller, faster, cheaper and more energy-efficient
semiconductors. Five more of these will be shipped by mid-2011.

A third genereration EUV tool and infrastructure was to be
shipped in 2012 with eight agreed orders and more expected in
the fourth quarter. A nanometre is a millionth of a millimetre,
or a hair’s width divided by 100,000.

ASML has a market capitalisation of $13 billion, compared
with Nikon’s $7.8 billion and the $62 billion of Canon.
(Additional reporting by Gilbert Kreijger; Editing by Dan
($1 = 0.7214 euro)

UPDATE 7-ASML Q3 profit beats forecasts, sees record orders