ASM beats own Q2 revenue guidance, sees stronger second half

Investing.com -- ASM International posted record second-quarter revenue above the midpoint of its own guidance and forecast higher third-quarter sales, buoyed by strong demand for equipment used in advanced AI chip production.

The Dutch chip equipment maker posted second-quarter revenue of €1.003 billion, up 20% from a year earlier and above the midpoint of its guidance of €980 million, plus or minus 5% at constant currency. Growth was driven by strong demand from leading-edge logic and foundry customers, robust high-bandwidth memory (HBM) DRAM sales, and continued strength in China's mature logic/foundry market.

The company said AI-related investments continued to accelerate during the quarter as chipmakers expanded advanced manufacturing capacity to support growing compute workloads. Demand was particularly strong for leading-edge logic technologies, including the 2-nanometre node, while the 1.4nm node remains on track to make its first meaningful revenue contribution in the second half of 2026.

Gross margin remained strong at 51.9%, while adjusted operating margin was 33.0%, broadly unchanged from the previous quarter as operating leverage and disciplined cost management offset continued investment in research and development.

Adjusted net earnings rose to €292.9 million from €173.0 million a year earlier, helped by stronger operating performance and favourable currency movements. Free cash flow reached a record €355 million, reflecting strong profitability and an improvement in working capital.

Looking ahead, ASM expects third-quarter revenue of €1.1 billion, plus or minus 5%, at constant currency. It also expects second-half revenue to rise by more than 20% from the first half, supported by continued growth in leading-edge logic, memory demand and initial contributions from the 1.4nm technology node.

The company also upgraded its longer-term outlook, saying it now expects 2027 revenue to exceed the upper end of its previously announced target range of €3.7 billion to €4.6 billion, citing strong order intake, improving visibility from customers and higher expectations for wafer fabrication equipment spending.

Separately, ASM reiterated that Chris Figee is expected to join as chief financial officer on Dec. 1, 2026, succeeding Paul Verhagen following shareholder approval expected in March 2027.

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