Over the course of 50 years we have grown to become a global company that develops innovative solutions for our customers, and manages the best interests of our investors, our employees, society and other stakeholders. Read on to discover what we achieved in 2018.
The demand for smaller, faster and cheaper semiconductor chips continues to rise, driven by advancements in cloud computing, artificial intelligence, smartphones and the Internet of Things.
Our technology is the first step towards making it all possible, as our R&D investment in new materials, new products and new processes means we can help our customers develop their technology roadmap, and further extend Moore’s Law.
In 2018, this led to the introduction of the Synergis ALD tool, which leverages the core technologies from our Pulsar and EmerALD ALD products for high productivity thermal ALD applications. The new Synergis tool allows us to address more ALD applications and therefore increases our served market. Together with our other products and services, this contributed to our strong financial results, which included:
We operate in a fast-paced industry that continues to reshape the world, and our innovative technology enables the semiconductor industry to achieve advancements in computing, communications, energy, transportation, medicine and beyond.
To ensure that we can continue to make a difference to our customers, employees, and company stakeholders, in 2018 we concentrated on the following three key elements of our strategy.
In addition to our fundamental R&D efforts, we continuously expand and deepen our strategic cooperation with key customers, suppliers, chemical manufacturers, and research institutes. This approach enables us to remain innovative and swiftly meet the changing demands of our customers.
We are a key player in the deposition equipment segments for ALD and epitaxy, and a focused niche player for PECVD and vertical furnaces. As a leader in the segment, ALD has turned into a key growth driver for our business, from which we support virtually all of the leading customers in the semiconductor industry. Our newest ALD tool, Synergis, is designed to address a wide range of existing and new ALD applications, effectively increasing the market we serve.
In addition to our internal optimization programs, we are working with our suppliers to improve fundamental quality through statistical methods and process controls. In addition to addressing the technology needs of our customers, we also focus on further increasing equipment throughput and equipment reliability, thereby lowering the cost per wafer of our wafer processing systems.
In 2018, we achieved revenue growth of 11% reaching a record high revenue of €818 million, with sales increasing mainly in the logic, DRAM and analog segments. By industry segment, our 2018 revenue stream was led by memory, closely followed by the logic and foundry segments.
While our ALD product lines continued to be our key sales driver in 2018, accounting for more than half of total equipment revenue, our other product lines also contributed strongly. In our epitaxy product line we increased sales, following the strong growth we achieved in 2017, and we saw additional sales increases in PECVD and vertical furnaces.
Our industry experienced continued growth in 2018, with worldwide semiconductor industry sales increasing by around 14%. This was driven by high memory prices and broad-based electronics demand for cloud services, mobile devices, automotive and industrial applications. These drivers helped the wafer fab equipment market grow by around 10% in 2018.
Our 2018 sales grew to record levels, reaching €818 million. ALD continued to be the key driver, although the other product lines also made a strong contribution.
We benefited from a further increase in wafer fab equipment spending following the very strong market growth in 2017. Our operating profit increased to €124.3 million from €113.2 million in 2017, while the operating profit margin remained stable.
New bookings increased by 22% in 2018 to €942 million, with equipment bookings for ASMI as a whole led by logic, followed by foundry and then memory. Total research and development (R&D) expenses, excluding impairment charges, decreased by 1% in 2018 compared to 2017, mainly as a result of higher capitalization of development expenses.
Our 2018 sales grew to record levels, reaching €818 million. ALD continued to be the key driver, although the other product lines also made a strong contribution.
We benefited from a further increase in wafer fab equipment spending following the very strong market growth in 2017. Our operating profit increased to €124.3 million from €113.2 million in 2017, while the operating profit margin remained stable.
New bookings increased by 22% in 2018 to €942 million, with equipment bookings for ASMI as a whole led by logic, followed by foundry and then memory. Total research and development (R&D) expenses, excluding impairment charges, decreased by 1% in 2018 compared to 2017, mainly as a result of higher capitalization of development expenses.
During 2018, we returned approximately €607 million to shareholders in the form of dividends, share buybacks and the capital return. This was up from €281 million in 2017 and €140 million in 2016.
Over the 2010-2018 period, we returned more than €1.6 billion to the financial markets through dividends, share buybacks, return of capital, and buyback of convertible bonds.
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In 2018, we paid a dividend of €0.80 per common share and we will propose to the forthcoming AGM to declare a dividend of €1.00 per share for 2019. The proposed 2019 dividend will mark the ninth consecutive year that we have paid a dividend.
In 2007, ASMI licensed Hitachi Kokusai Electric Inc (now called Kokusai Electric Company and hereafter referred to (including its affiliates) as Kokusai) under certain of its patents in the field of Atomic Layer Deposition. The license agreement was renewed in 2012.
On August 30, 2017, ASMI initiated an arbitration with the American Arbitration Association against Kokusai for breach of the license agreement between the parties. At this point of time it is unpredictable when the arbitration will be completed but the current expectation is in the first half of 2019.
Following the expiration of the parties’ patent license agreement, ASMI filed, on December 1, 2017, a suit for patent infringement against Kokusai and its US subsidiary in the US District Court for the Northern District of California. ASMI has asserted infringement of three of its patents and is seeking both an injunction and monetary damages.
Kokusai filed suit on December 1, 2017 for alleged patent infringement against ASMI in the US District Court for the Northern District of California. Kokusai has asserted seven patents and also seeks an injunction and monetary damages. No specific monetary amount has been requested to date. On December 5, 2018, ASMI asserted in the same proceeding counterclaims which included infringement of three additional patents by Kokusai.
On February 20, 2018, Kokusai initiated litigation in the District of Oregon asserting four patents against ASMI. Both parties have filed for Inter Partes Reviews (IPR) at the U.S. Patent and Trademark Office on the U.S. Patents asserted in the various US jurisdictions. The outcomes of those IPRs are currently unknown but are anticipated to be completed in twelve to eighteen months.
On September 21, 2018 ASMI filed two lawsuits in Tokyo District Court against Kokusai asserting infringement of two patents and requesting a preliminary injunction to prevent the continued infringement of our patents in Japan.
On February 8, 2019 Kokusai filed seven lawsuits in Tokyo District Court against ASMI asserting infringement of nine patents in total and requesting a preliminary injunction to prevent the alleged continued infringement of their patents in Japan.
ASMI will vigorously defend its position in each suit asserted by or against Kokusai. Litigation concerning intellectual property rights is complex and usually takes a protracted period of time. Therefore in connection with these lawsuits ASMI may incur substantial legal fees and costs, and it is not certain that ASMI will prevail in the suits. If ASMI would not be successful in its suits as plaintiff or as defendant, then the potential outcomes may include, without limitation, payment of significant monetary damages, injunctive relief prohibiting sales (in the USA or Japan), and/or settlement involving significant costs. At this stage it is not possible to predict the outcome of the above mentioned suits, or whether other suits will be started by Kokusai. The final outcome could potentially have a material adverse effect on our business, results and financial condition.