ASM International N.V.

Q2 revenue was €1 billion, above the €980 million guidance level on a constant-currency basis, and increased 24% year over year and 15% versus Q1 26. Equipment sales rose 22% year over year at constant currency; spares and services grew 34% year over year at constant currency. Gross margin was 51.9%, adjusted operating margin was 33%, SG&A was 7.9% of revenue, net R&D was 11.1% of revenue, and free cash flow was a record €355 million. The company ended the quarter with €1.2 billion of cash, days of working capital improved to 50 from 69 at the end of March, and CapEx was €63 million. For Q3, ASM expects revenue to increase to €1.1 billion; for 2H26, revenue is projected to be up more than 20% versus 1H26 at constant currency. Full-year gross margin is expected to be around 51%, SG&A below 8.5%, net R&D in a low-double-digit percentage range, and CapEx to be above the high end of the €150 million to €250 million guidance range.

Hichem M'Saad emphasized that demand remains very favorable, supported by AI infrastructure spending, semiconductor capacity expansion, and customers prioritizing equipment to support growth plans. He highlighted strong momentum in leading-edge logic/foundry, early 1.4nm engagement, improving DRAM demand, and a gradual recovery in power/wafer/analog. His tone was notably upbeat on 2027, saying customer discussions and early equipment plans give ASM confidence that the business can grow at least in line with, and likely above, WFE.

Paulus Verhagen walked through a quarter with €1 billion of revenue, 51.9% gross margin, 33% adjusted operating margin, and record €355 million free cash flow. He said margin strength came from favorable product/customer mix, including China, plus improved efficiency and productivity, while SG&A improved to 7.9% of sales and CapEx was €63 million. He also flagged €22 million of currency translation gain versus a €60 million loss last year, and said the company ended with €1.2 billion of cash; he reiterated a roughly €150 million share buyback program starting in 2H and said ASM continues to scan for M&A.

Analysts focused on the size and timing of 2027-2028 growth, the durability of mature logic/foundry in China, whether customer ordering is being pulled forward by export-control risk, and the potential contribution of 1.4nm, molybdenum metallization, DRAM, and 4F². Management repeatedly said 2027 looks very strong, with Hichem stating that if WFE grows 30%, ASM should at least grow at that level, and Paulus saying the company expects to outperform WFE thanks to mix and new wins. On China and export controls, Paulus said there has been some accelerated ordering but not excessively so, while also acknowledging low visibility. On 4F², Hichem said there are some customer hiccups but that the transition is not consequential for ASM because even 6F² still needs ALD and epitaxy; on supply chain, Paulus said stress is increasing but manageable and that order book coverage is typically 6 to 9 months.