“Of all the competitive advantages that I’ve ever come across, I can’t think of one as more significant as ASMLs”
This podcast is interesting as it goes through a business that is difficult to understand on its face, but is mission critical. What makes the story interesting is that ASML, a Dutch business specialising in the manufacture of machines which are used to produce computer chips, started as a spin out of Phillips. At the time, in the mid-1980s, ASML had no revenue, was last in its competitor set, had no commercially viable product or even an office.
“ASML was spun out by Phillips, was a problem child and that failed to succeed ….A good portion of the workers didn’t want to be there, expecting the company to die”
Going forward from the 1980s to today:
“In2022 they produced Revenue of ~$21 billion (Euro) and a ~$6.5 billion (Euro)profit, after only selling 345 photo-lithography machines. It’s a low volume item, which is very very specialised, with their most expensive piece of equipment selling for north of $150 million euros a piece.”
Phillips sold half of their stake at the IPO and the rest in the years following ASMLs listing, with ASML now capitalised at $220 billion Euros. The podcast runs through ASMLs margin profile, capital-light model, integration with suppliers, the nature of the product, machine explanations, the industry itself and more.
Join our investment community. Be the first to receive NAOS News, Podcasts, Insights and Invitations.
By subscribing, you consent to NAOS using your personal information in accordance with its Privacy Policy, a copy of which is available here.
Join our investment community. Be the first to receive NAOS News, Insights and Invitations.
