{"text":[[{"start":12.26,"text":"Does a new chip cycle beckon? "},{"start":14.427,"text":"Record fourth-quarter orders of €9.2bn at ASML, the Dutch manufacturer of chipmaking equipment, suggests a new boom may be on the horizon at long last. "}],[{"start":24.96,"text":"The $304bn company has successfully navigated the post-pandemic chip glut and east-west tensions. "},{"start":31.489,"text":"ASML makes the advanced lithography machines used to manufacture high-end semiconductors. "},{"start":36.882000000000005,"text":"In a year in which smartphone and PC inventories are slowly being sold down, and utilisation of other semiconductor manufacturing capacity depressed, ASML increased sales 30 per cent, to €27.6bn. "}],[{"start":50.29,"text":"That reflects its privileged market position. "},{"start":53.219,"text":"With long-lead orders for its machines far outstripping its capacity to manufacture them, ASML could boost its shipments even in a soft year. "}],[{"start":61.96,"text":"Strong demand from China helped. "},{"start":64.31400000000001,"text":"Despite US-led efforts to limit the country’s access to the most advanced chips, China still accounted for 39 per cent of ASML’s fourth-quarter sales. "},{"start":72.757,"text":"China is importing older equipment as it positions itself to compete on less complex chips. "},{"start":77.699,"text":"Increasingly stringent regulations mean that ASML expects to lose about 10-15 per cent of its sales to China in 2024, contributing to a flattish forecast for the year ahead. "}],[{"start":88.75,"text":"Nevertheless, the company is betting — and investing — for a renewed chip boom in 2025. "},{"start":94.917,"text":"Fourth-quarter intake was about three times larger than analysts had expected. "},{"start":99.084,"text":"That underpins about half of 2025 revenues, thinks Andrew Gardiner at Citigroup. "},{"start":104.077,"text":"The majority of new orders relate to ASML’s newest “EUV” machines. "},{"start":108.032,"text":"These should expand gross margins by about 300 basis points to between 54 per cent and 56 per cent in 2025. "}],[{"start":116.41,"text":"ASML’s order boom will cheer investors eyeing the next cyclical upswing in the chip sector. "},{"start":121.777,"text":"Its customers believe they will need more capacity some 18 months from now. "},{"start":125.869,"text":"TSMC, the giant Taiwanese chipmaker, also sees the cycle turning. "},{"start":130.774,"text":"It reckons 2024 revenues will rise by up to 25 per cent — higher than analysts had been expecting — as demand for smartphones and PCs picks up. "}],[{"start":140.37,"text":"Not all chipmakers are created equal, though. "},{"start":143.58700000000002,"text":"America’s Texas Instruments still sees a soft market ahead for its automotive and industrial semiconductors. "}],[{"start":150.41,"text":"At the foothills of a cyclical boom, its valuation looks attractive. "},{"start":154.777,"text":"On 25 times 2025 earnings, that multiple could well improve as the outline of the recovery comes into focus. "}],[{"start":161.97,"text":"Moreover, ASML’s near-monopolistic position in advanced lithography surrounds it with a considerable moat, protecting profitability. "},{"start":169.862,"text":"Its kit is also essential to manufacture advanced AI-enabling chips, which gives it a strong long-term growth outlook. "},{"start":176.454,"text":"Even after a strong run, the shares have promise. "}],[{"start":179.45,"text":""}]],"url":"https://creatives.ftacademy.cn/album/139456-1706149707.mp3"}