Great. Well, hi, everyone. I'm Alex Duval. I head up the Europe Semis coverage for Goldman in London. Delighted to be here with Pete Convertito, VP of IR ASML. Thanks so much all for joining. We'll have some time at the end for Q&A. I think we'll get straight into questions from me. Once again, thanks a lot, Pete, for joining. Oh, great to be here. Great. Perhaps we could just start off with a quick recap of how you see the broad high-level trends. Perhaps you could help us understand a bit, the high level of supply and demand dynamics, and then we'll get into more specifics. Sure. You know, we had our Q1 results, and we talked about, you know, we're seeing the same dynamic market as everyone else with a bit of weakness in the memory market, as customers try to work through supply-demand imbalances in memory. Logic continues to be strong, particularly areas like automotive and industrial and mature logic continue to be healthy and strong. Strong demand from China. In total, if you do all that, we said it's about 25% growth in our top line. If you break that up across markets, you know, we said, you know, EUV continues to grow at about 40% over last year, non-EUV, about 30%. Our Installed Base Management, which is a combination of service and upgrades, grows about 5%. A bit of a headwind on that this year. Our service business continues to grow with the installed base, but the upgrade business is a bit muted this year as, you know, customers wait for the cycle to work through and the recovery to come back. You know, take that all together, we see that about 25% growth this year on the top line. In a dynamic market, with things like memory cycle and inflation, still a positive year for us. Super helpful. Perhaps we can dive in a little bit on EUV. We saw in the last quarter, obviously, orders for EUV came in a bit below what people may have expected, down slightly quarter-on-quarter. Can you help put that in context a little bit? What should we be expecting in the coming quarters and months? Any color there, much appreciated. Sure. you know, we don't guide on our bookings, but we've certainly had a good eight or nine quarters of strong bookings through last year. I think we've, you know, indicated coming out of last year that in the environment we're in, it would be not unreasonable to see bookings come down, which we did see them come down to EUR 3.8 billion from a peak of about EUR 8 billion in the Q3. Keep in mind, we're also now booking tools, especially some last year, High NA tools that are EUR 350 million a piece plus. Orders will continue to be lumpy when you're booking tools of that ASP as well as, you know, EUR 170 million a piece on Low NA EUV. Keep in mind, it wasn't unreasonable to see bookings come down. If you look at our backlog, we have a backlog of EUR 39 billion, which is roughly, you know, 2x what we'll ship this year. Not all of that is deliverable next year. Some of that, again, is High NA tools, of which some of those won't ship until 2025. Peter Wennink, on our call, was asked about next year, right out of the chute on the earnings call, and he said, "Well, it's only Q1. It's a bit early to guide next year. With EUR 39 billion, that's double what we'll ship this year." There's still some slots to fill in the second half of next year. You know, there's still time for those bookings to come in to fill out next year. Demand from our customers is certainly. They're asking for more tools to ship, be shipped next year than what we're shipping this year, but there's still some slots to be filled with bookings, and there's a couple quarters for that to still be filled out as, you know, our supply chain improves, which means our lead times improve a bit. You know, I think Peter Wennink described it as we expect the supply chain to be back in the shadow of ZEISS, as ZEISS is our longest lead time supplier, sometime through this summer. There's still a couple quarters to be able to fill out next year, that'll be, you know, basically a function of where our customers think they are in this supply-demand balance. Their calendar, you know, Q1 results, they were, you know, cautiously optimistic. You know, I think we think in the next quarter, we'll see bookings come back. Super helpful. I think you saw in Q1, your order backlog, at EUR 39 billion, roughly. To what extent could there be a risk that there's some kind of push out there that could perhaps put at risk your guidance for next year, which is that both DUV and EUV would grow? How plausible is that kind of scenario for next year? Well, again, it comes down to this, you know, where they think they are in the supply-demand balance. If they get back to that, and throughout the summer, we were confident we'll see bookings to fill out, you know, next year, although we haven't guided how many we'll do next year and what that is. Certainly the demand is there. If it's a quarter, where another quarter, they probably will still book it because of the lead times of our tools. If they think we're in a, you know, longer term recession or the cycle is several quarters, then they'll have to make a decision around that. Those are kind of the factors that'll go into that. Brilliant. I'd like to talk about logic demand. One of the themes we've seen in semi cap land is more demand from mature nodes. Absolutely. We've seen that on the analog side, the power semi side, et cetera. How do you feel about the sustainability of that? Well, if you followed us and you followed our Investor Day the last two years, typically, we do them every two years. We did one in 2021. We did another one in 2022 because we were seeing very strong demand and looked at the drivers of what were driving that and had to up our capacity plans to support that. You know, one of the significant growth drivers there, particularly for DUV tools, was this mature logic market. You know, we underestimated that in 2021. We talked about a bit in the 2022 Investor Day. You know, things like distributed compute or edge compute, as enabled by 5G and connectivity, is driving a lot more of these devices, Ring doorbells, Nest thermostats, more and more ICs in household appliances. We think there's a lot of growth in that area, enabled by leading edge. On top of that, you have the conversion to electric vehicles, which has quite a lot of IC content to it, and we're, you know, in the early innings of that transition, and we see that consuming a lot of mature devices. You know, we see secular growth there, and we see this continuing for years to come. We don't see this as a transient thing. Frankly, that market in the past has been served by quite a bit of used equipment, especially when it was on eight inch, but now that a lot of that has moved to 300mm, there's not really any used equipment out there to support it. There's been capacity adds all along, but now that it's, you know, transitioning or primarily in 300mm, there's not much used equipment. The capacity adds have kind of gone under the radar, and now they have to buy new equipment to support that. We see that in Europe and U.S. as well as China. Great. Another key discussion point, of course, is AI. No discussion will be complete at this conference without it. You know, obviously had the very clear commentary and guidance from the likes of NVIDIA. Can you just help us understand how much upside ASML could have from this? How are you geared into it, and how do you think about that in the near term, specifically, as well as the longer term? Sure. You know, that was another area of the mega trends we talked about in our Investor Day in 2022, that was incremental over 2021. Not specific to AI, but leading edge logic. We underestimated in our 2021. You know, the way our long-term model works is we take end market semi forecasts and demand, and apply knowledge we have around die size and logic and bit growth and memory and knowledge of layer stacks, and can calculate number of tools from that. One of the areas we were a bit conservative on in 2021 was die size. In talking with customers, our assumption need to be slightly bigger, which means for the same number of devices, you need to process more wafers, which is driving more equipment demand and leading-edge logic in our model. Is all of that AI? Not saying that, certainly some of it is probably AI. We haven't. You know, I don't think we've revealed specifically what portion of it is attributed to AI, certainly we see that as a long-term trend that's driving demand for leading-edge logic tools longer term. You know, I'd say we're positive on that for equipment spend longer term. Short term, I think our customers are cautiously optimistic about it. They're still in the learning phases of it. Are we in the ramp or are we in a bit of the hype cycle? I think that's still a little bit TBD, but I think in general, you'd say, you could say ASML is positive on AI and capital spend attribute associated with it. Great, if we spend a bit of time on leading-edge Logic and Foundry, you know, we saw talk of lower utilization on 7 nm and 5 nm. Still strong demand on 2 nm and 3 nm. You know, how does that sort of impact your expectations for Logic Foundry as we go into the second half of the year and into next year as well? You know, as I said in the earlier comments, you know, we still see, obviously, mature logic running strong, you know, most advanced nodes, say, 3 nm, ramping, strong demand for equipment there. Frankly, you know, leading-edge logic and memory as well as they plan their technology transitions and the tools they need for that EUV, with its long lead time, they continue to order and buy that equipment. You know, on the utilization of, say, you know, second-tier nodes or not lagging edge, but, you know, larger than 3 nm, you know, a customer of ours commented on a bit of weakness in utilization because of the smartphone and PC market, but, they expect that to return as the market comes back. You know, we still see, you know, demand and shipments to leading-edge logic as well as memory for technology buys, and, as they work through this supply-demand imbalance, they expect that to come back. Got it, talking of supply-demand imbalances, I think on DUV, the company's talked about a delta of about 20% between supply and demand at the latest results. What's your sort of latest update on where the gap is? As we look forward in future quarters, do you see that increasing, or could that close a little bit? I think it's worthwhile going back and first talking about where we were coming out of 2021. On DUV, Peter Wennink had commented that we were undersupplying by 40%-50% on a unit basis on DUV systems to the market, which was another driver to step up our capacity, which we're growing to 600 units in 2025 on DUV and 90 units on EUV. You know, throughout the year, as this, you know, cycle started, we saw some players, majority being memory, pushing demand on DUV out a bit, but still exiting the year 2022, undersupplying by about 30% on a unit basis. That was to, you know, the. All customers, certainly, you know, China was included in that. We were undersupplying to them, when they see others pushing out, they said, "If they don't want it, we'll take it." If you saw in our results, we're stepping up shipments to China this year because they're willing to take those tools, and now we're undersupplying by about 20%. That's a combination of the demand of undersupply being satisfied and us also growing our capacity. We said we'll do about 375 DUV tools this year, of which about 25% is immersion. We're at about 20%, undershipping to the demands of the market right now. Very helpful. I think you referenced China, we know that now roughly 20% of backlog is represented by China, and I think that's supposed to be roughly where sales will be for this fiscal year. You know, some investors have just asked, you know, to what degree does that represent real demand? To what degree could that represent sort of rush orders before some kind of incremental change in terms of regulation vis-a-vis the U.S. comes in? How should we put that in context? Yeah, like I mentioned, we were undersupplying to everybody last year to demand, including China. You know, if you've followed us and you've listened to the commentary of our management over the last year and a half, you know, Peter Wennink talked about we added nearly a dozen customers almost a year ago in DUV, and they were, you know, some China customers that you've probably never heard of, and they're building things like power devices, analog devices, microcontrollers, CMOS image sensors, things that go into these mature logic markets of, you know, edge or distributed compute, consumer electronics, and even automotive. I mean, China's got a big market share of automotive ICs, and, you know, that's a growing area. We see these going to, you know, the big customers in China, but also a long tail of these smaller customers ordering, you know, a handful of dry tools here and there. It's real demand, and, you know, if you follow our Capital Markets Day or Investor Day, this is an area that we see of strong secular growth. You know, like I said earlier, it's not just China, it's Europe and U.S. that are putting capacity in to serve that market. We see this, you know, carrying on going forward. Great, if you were to see a sort of ratchet, further ratchets and restrictions from the U.S., you know, what impact would that have? Maybe you can sort of recap where we've got to and what you think will happen with the next layer of restrictions. Sure. I mean, I think we were the first ones to be affected by restrictions, four or five years or so ago with EUV. We were restricted from shipping EUV tools there. We've been unable to get a export license for that. In October, there was another round of restrictions around advanced processes in logic and memory. It was on U.S. suppliers, but we took a look at that time at our backlog and what processes those tools could be shipping to, and said: Well, there's probably about an indirect impact of about 5% of our backlog. As if they can't get other parts of the process, they might not want to take the litho. They've continued to take their litho. In March, was announced, there would be a trilateral agreement between Europe and Japan and the U.S. around advanced immersion tools. I think Peter Wennink talked to that a bit on our Q1 results and said, it's around advanced immersion. You know, if we look at advanced immersion, we interpret that as our NXT:2000i and beyond, so NXT:2050i and NXT:2100i. Because those would be able to be used for advanced processes, which, you know, are trying to be restricted. So we'll have to apply for an export license there. You know, there's still mature processes like 28 nm node and 45, that do require immersion, single pass. We think, you know, the more mature immersion tools will be able to get a license and ship. There'll be more clarification on the restrictions, you know, in the coming months, as I think Peter put it, in another month or so. If you look at the, you know, what those restrictions could be or will be, our long-term modeling and the current demand environment, you know, we think there won't be any material effect on our business, short or long term in our model. Very helpful. I'd like to also talk about average selling prices. you know, clearly, there was some discussion about potentially getting higher ASPs to help compensate for inflationary impacts. Where are we on that? To what extent is there more upside to come through from that? Equally, given the weakening macro environment we've seen, is there any downside risk on the selling prices? Yeah. Roger Dassen talked about that quite a bit over the last couple of quarters. you know, we saw some impact last year, as we, headwinds on our margins as, inflation, you know, crept into our costs. you know, some of those costs we don't add value to. For instance, shipping and transportation costs, and, you know, that's an area where we've been going back to our customers and, saying: "Hey, you know, it's an area we don't add value. It's pretty much passed along. you know, can you help with that?" we're seeing some success in that and improved ASP. we've seen some of that, and we'll probably see a bit more going forward. Roger comment about that in terms of gross margins, we think, we've neutralized that for this year in terms of impact on gross margins, as long as inflation doesn't continue to go up. Great. I think another topic we've had questions on a bit is on sort of lead times. If you think across EUV and DUV, the argument, I guess, a few quarters ago, was that these lead times are so long, that it insulates you to quite a significant degree, from, you know, macro risks, because the customer knows they have to wait a long time to get the tool, and therefore, they don't want to go to the back of the queue. I think the numbers quoted were one year on DUV, two years on EUV. To what extent does that dynamic still hold? To what extent has it perhaps changed? You know, to what degree does it still help insulate a bit from risks? Sure. You know, litho is still quite a long lead time item in the fab compared to the other equipment. You know, pre-pandemic, you know, if you came to us and hadn't given us any forecast for tools or hadn't included forecast for incremental tools that you wanted, it was about six-nine months for a DUV tool. Six months on the, on the, say, a dry tool, and more like nine months for an immersion tool. You know, 12-15 months, a Low-NA EUV tool. Through the pandemic, that grew as supply chain grew and our capacity was well below what demand was out there. You know, you had Low-NA that was more like 18 months to two years. You know, across the board, DUV was settling at more like a year if you hadn't given us a advanced forecast. You know, now those, as we've worked through supply chain issues and increased our capacity, those have come down, not to pandemic levels, but pre-pandemic levels, but as Peter Wennink put it, the supply chain is probably throughout the summer, we'll get back to, in the shadow of ZEISS, which is our longest traditionally, our longest lead time supplier on optics. You know, getting much better. There's still a couple quarters for customers to put orders in to fill out next year. It's still a long lead time item, so from the insulating factor standpoint, you know, you're still a year plus on Low-NA EUV tools and, you know, some here between, you know, nine months and one year on DUV. If you think, if you're a customer and you think, you know, the supply-demand gets back in balance in a quarter or two, you're not gonna get out of line for, say, an EUV tool. You're gonna wanna, you know, put orders in, 'cause what you're putting orders in, if it's second half of next year delivery, it's about outputting wafers in the second half of 2025. You know, that's why we say things like, you know, technology tools are insulated from this a bit. On the DUV tools, you know, if they think it's back in balance within a quarter, they'll put orders in. If they think it's a couple quarters out, they may hold off a bit to see where they're at, but still, relatively insulated. Makes total sense, Pete. I'd like to now talk a bit longer term. We've talked a lot about Low-NA. Let's talk about High- NA. Could you give us the latest snapshot on the situation on High- NA orders? If we look at your 2025 plan, your 2030 plan, you obviously updated those relatively recently. How much of the High- NA unit targets within that is actually covered by current backlog, and how should we be thinking about the High- NA orders going forward? Sure. Well, you know, we certainly started booking High- NA tools, the EXE:5000, which will be the first version of it, you know, development tools for customers, you know, several years ago. We initially booked, I think we talked about four tools to three customers. We've booked a couple more since then, but last year, we started booking orders for what would be the production or high volume manufacturing tool of the EXE:5200, and, you know, we booked several of those. I think we even commented that at least every customer has at least one in the backlog of the EXE:5200s in both logic and memory. You know, we have a good backlog of those tools. We'll start shipping the EXE:5000 late this year, first tools. you know, that EXE:5200 doesn't really start to go out till late next year into 2025. If you look at our modeling that we showed at Investor Day, I think we show, on a high scenario revenue of five systems in 2025. you know, we'll start shipping those tools again late this year and the EXE:5200s in 2025. You'll see the revenue from those in there, but we'll plan to ship more than that. It'll take a while to revenue these tools, as it's a new platform, and we have to ship them and install them in our customers' fabs and prove they meet spec before we get revenue on those, as with any new platform. You know, I think we're working towards those numbers. We talked about growing the capacity to 20 units in the, you know, 2027 timeframe at our Capital Markets Day, we're still working towards that plan. Super helpful, and just maybe as a follow-up, could you help put in context a bit their applicability to logic versus memory? How should we be expecting the order trends there? Yeah, I think in our backlog, you know, EUV in total is high 70%, low 80% logic, and the remainder, memory. I think, it's, you know, that's representative of EUV in general. Very clear. I think we've got 15 minutes left. I'd like to leave some time, at the end for audience questions, but maybe just one more from me. How should we think about, you know, scope for High- NA to cannibalize Low-NA over time? How will the dynamic play out? Because obviously, you're getting high productivity, you're getting all these extra bells and whistles and efficiency from High- NA, so these are very expensive tools. How should we think about how they coexist with Low-NA as they ramp up towards 20 tools et cetera per year? Sure, sure. Just like with, as EUV came in for D UV, it's there to mitigate the need to go to multi-pass patterning. Frankly, on EUV, we were late to it when we initially thought it would go in. Multi-pass patterning grew, which allowed our customers to continue to shrink, but not in a cost-effective manner. If you went back to one of our investor days when we started seeing EUV actually go into volume manufacturing, we thought we'd see some cannibalization of the immersion business as it ramped. Frankly, we didn't. We're shipping just as much now, if not more, immersion tools because the nodes that it applies to are continuing to grow longer and stronger. Certainly, it did cannibalize some of that on a specific application when you go from one node to the next. On Low-NA to High-NA, it's there to, you know, negate the need to go to multi-pass patterning on Low-NA EUV. It'll be used on the additional critical layers that would need multi-pass patterning if you didn't have High-NA. I don't think we see a lot of cannibalization there. You'd see more Low-NA if High-NA weren't there, but, as it comes in, you know, you'll see Low-NA kind of stay on the layers it's on, and the more critical layers will move to High-NA. Some, but not as much as you saw as the transition from immersion to Low-NA, because we were a bit delayed on that, and multi-pass patterning grew quite a bit. Great. Maybe one final question from me before we go to the audience questions. If we look across the semi cap landscape, you know, we've got some of these new trends, chiplets and new materials, and also Gate-All-Around. Sometimes we get asked by investors, you know, what does that mean for EUV? What does it mean for ASML? Can you help put that in context a little bit? Sure. We see gate-all-around as a good thing. The reason they go to Gate-All-Around is because if you don't, if you try to shrink FinFET, the performance of the tools or the power consumption gets worse, you need to go to a different architecture, just as they did going from planar to FinFET. FinFET allowed shrink to continue, and performance to continue to improve. We see the same thing happening when you go from FinFET to gate-all-around. You're going to gate-all-around because you want to allow performance to improve, and frankly, it allows shrink to continue. We think the transition will be very similar to the transition from planar to FinFET, which took place at the 20 nm node, and subsequently to the 16. At 20, they were planar. At 16, they brought FinFET in. There really wasn't any shrink because it's highly risky to do shrink and an architecture change at the same time. They introduced 16 FinFET on 16, put an amount of capacity in that let them pipe clean out that process, once that was working, then you go to a sub-node of 14 and 12, where you have more shrink and frankly, required more litho. We consider that all one node, meaning 20, 16, 14, 12. We think you'll see the same thing at Gate-All-Around. Regardless of what node you're doing at, you know, the first incarnation, you'll bring Gate-All-Around, you probably won't really shrink. After you pipe clean that initial introduction of it, then that enables shrink, and we'll see more litho or more EUV as you do sub-nodes of that. In general, we'll see more EUV for the whole node. We've talked about, in general, you see about 30% more litho spend per logic node as you go forward, and DRAM, it's about 20%, and NAND, it's about 10%-15% spend per node. You know, Gate-All-Around, we see as a positive. Certainly, materials benefit from that, and our CTO in the past has talked about, there's four ways to continue to improve cost on the semiconductor roadmap. There's shrink, which we're the shepherds of, if you will, and certainly going to Gate-All-Around enables more shrink to happen, we see that as a positive. There's materials, you need those materials for Gate-All-Around, that's a positive. Packaging is a positive. Things like chiplets make the ability to do this more affordable. Anything that improves cost or affordability for our customers has the ability to spur demand. We see that as a positive as well, and last is architecture, which we just talked about. You know, we see any of these that are improve the cost per function equation for our customers as beneficial for all of us in the equipment business. Super helpful, Pete. I'd like to go to audience questions. If anyone has a question, be most grateful if you could raise your hand. Shy crowd. Thank you for taking my question. At the beginning of your remarks, you said that in your long-term model, you maybe did not correctly think about the die size, and die sizes were a bit bigger than what you initially thought in advanced logic. What I'm interested in is also trying to understand how you came up with your long-term $1 trillion model for 2030, and in particular, how you think about volume versus price of semiconductors. I think over the past two years, we've seen a very strong ASP for some semiconductor areas, and I was wondering if in your long-term model, you assume, you know, normalization of price growth, price declines versus volume? Like, if you had any thoughts around that? Yeah, it's a good question. You know, our, again, our long-term model is built off, again, to your point, a third-party forecast, and I think even in that Investor Day slide deck, if you look at it, there's a couple of different ones that are anywhere from a $1 trillion-$1.2 trillion or so, semi end market in that timeframe. You know, we use that and apply things like die size and bit growth and our knowledge of which we have pretty good knowledge on layer stack and roadmaps and can calculate a number of tools from that. If our CEO, Peter Wennink, were here, was here, he'd say, the industry in total, us and forecasters, always get that long-term model wrong to the conservative side, because we're always thinking of the current drivers, not the future drivers, right? In 2014, we did an Investor Day, and we made some assumption about node sizes. Did anybody know in 2014, what a Ring doorbell or a Nest thermostat was? Probably not. They were thinking about things like PCs and mobile phones and saw that flattening and were concerned that maybe we were, you know, overestimating a mid-market scenario. You know, frankly, they weren't thinking about some of these things, nor were we. You know, he'd say we probably, if anything, are always wrong to the conservative side. In terms of ASPs, yeah, I'm sure our marketing people that do the modeling, you know, made rational decisions about ASPs. They're not using peak ASPs, but kind of long-term average ASPs in there, so. I'd say, you know, our CTO and our CEO and CFO would say, if anything, the industry always gets it wrong to the conservative side. Great. I think we've got two more minutes for this off-the-record discussion. I don't know if anyone else has a question. Hey, Pete. How are you? EUV installed base revenues based on some operating variables at the customer sites, how have those trended versus expectation? Do you expect the same algorithm, which, again, we don't know exactly, but do you expect the same terms on future shipments or an adjustment in installed base revs? Yeah, we talked about our Installed Base Management model. As you know, we went to a different type of model on EUV, a more output-based model. In our, in our DUV, we talked about, you know, roughly a 2% of the ASP of the tool in revenue on what has been a break-fix model on DUV or, you know, parts and parts and labor type of model. But under that model, you know, we can meet the contractual obligations that we signed up to, but there could still be, you know, long downs in that. If a tool goes down and a field service engineer goes in and say he needs a part, maybe he has it on hand, and he can get it back up and running quick, but maybe he needs something out of Wilton or Veldhoven or San Diego, and it's a day or two or maybe a week. That's a long down, and that's unpredictable output for our customers. On EUV, we went to more of an output-based model where we agree on, say, a price per or cost, service cost per wafer, and agree on an output they want to get, and we're responsible for maintaining the tool and providing good uptime and availability of the tool. If we exceed the agreed number of wafers, we get paid for that. If we short them, you know, they pay less. The win-win is they get more predictable output, and we get paid for the value we're offering in service, and we think we can get about 5% of the ASP of a tool per year under that type of model. And that's after the tool comes out of warranty, so roughly 18 months. Some tools are one year, some are two years, but if you say 18 months, that probably captures it. We've seen EUV service business grow over the last couple of years, in line with what we've expected in terms of revenue. I think Roger talked about the margins being, coming out of 2021, roughly, say, high 20s% gross margin on that business, and that grew to probably 30% last year, and that grows towards, you know, corporate margins in the 2025 time frame. I think we're seeing the revenue we expected, and we see margins continue to grow as more tools are installed per location, and we continue to work on the cost of parts for that as well. Great. Well, Pete, thank you very much for the very illuminating discussion. I think we're out of time. Thanks for having me. Appreciate everyone joining, and speak very soon.