One method to track the speed of the AI boom is to trace the hardware supply chain. Nvidia is the classic example: As AI corporations construct data centers, they buy billions value of GPUs every month, making Nvidia the most respected company on the planet. But Nvidia also has suppliers, and looking out at them may give us a fair longer-term view of the market.
That's why it's essential to us ASMLa Dutch photolithography company that has grow to be a serious hub within the semiconductor industry. ASML is the only supplier of the EUV equipment required to provide state-of-the-art chips, making it a key supplier for your complete industry. If ASML does well, it's because the businesses expect to sell a variety of semiconductors.
And based on The quarterly results were released on Wednesday morningThe company is doing very well.
Net sales are 32.7 billion euros, which is a variety of money by any standards. However, an important number for our purposes is the “recent bookings”, i.e. the brand new orders received on this quarter. A have a look at these orders tells us how much capability chipmakers are prone to need based on the orders they expect for data center expansion in the approaching years.
By this metric, the AI infrastructure boom remains to be going strong. In the last quarter, ASML recorded recent orders value 13 billion euros, a brand new record for the corporate and greater than twice as many orders as within the previous quarter.
In an earnings release, ASML CEO Christophe Fouquet made it clear that the extra demand is coming from AI.
“Many of our customers have provided a significantly more positive assessment of the medium-term market situation in recent months, based totally on more robust expectations concerning the sustainability of AI-related demand,” Fouquet wrote. In non-CEO English, which means their customers are assuming that AI labs really want all the info centers they're constructing and are spending money now so that they're able to ship the chips.
To be clear, none of that is guaranteed to occur. The future is unwritten! It may take years for all of those orders to be fulfilled and a few customers may withdraw before the delivery time. The dreaded lemon predictions could still come true and produce the whole lot crashing down.
But when you're waiting for corporations to back down on trillions of dollars in planned infrastructure spending, you might have to attend some time.
