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17 Dec 2024
Continued strength of semiconductor lithography sector pushes sales to another new record.
Optics giant Zeiss has posted another record-breaking annual sales figure, with the latest total of €10.9 billion up 8 per cent on last year’s milestone of topping €10 billion for the first time.
The historic Germany-headquartered firm now employs some 46,385 people - up nearly 3500 from a year ago - and continues to plow 15 per cent of its sales revenues into research and development efforts.
Despite that rise, the company's earnings before interest and taxes (EBIT) dropped around 15 per cent year-on-year to €1.44 billion for the 12 months ending in September, as CEO Karl Lamprect warned of multiple macroeconomic challenges faced by the firm - and stressed that the company’s answer, as always, was to focus on its innovation pipeline.
EUV impetus
As has been the case for the past few years, it was the requirements of semiconductor manufacturers - and lithography applications in particular - that provided most of the impetus for the latest rise in sales.
Zeiss’ “semiconductor manufacturing technology” (SMT) division delivered annual sales of just over €4.1 billion, up 16 per cent year-on-year in real terms as the requirements of the extreme ultraviolet (EUV) systems sold to major chip makers by key customer (and investor) ASML continued to grow in scale and complexity.
Orders were also up 11 per cent for the SMT business unit, suggesting that the sector remains on course for growth despite the wider macroeconomic concerns.
“The SMT segment was able to decouple itself from the market thanks to special circumstances such as strong demand for semiconductor production equipment in China,” Zeiss added.
“In the past year, Zeiss SMT supplied its customer ASML with the latest EUV product generation (high numerical aperture EUV lithography) for the first time.
“In order to meet growing customer demand and handle order backlogs, the SMT segment is expanding capacity at all its sites, but is doing so with caution in view of the uncertain global economic situation and the volatility of the semiconductor sector.”
Consumer caution
Each of Zeiss’ other three business division recorded currency-adjusted sales growth at a significantly slower rate, with “industrial quality and research” and “consumer markets” both up 3 per cent, and “medical technology” rising by 4 per cent.
The company highlighted strong sales of electron microscopy equipment, its April 2024 acquisition of Dutch Ophthalmic Research Center (DORC), and the expansion of its digital portfolio for eye care professionals as significant positives as consumers remained somewhat subdued in their spending.
“Despite a noticeable reluctance on the part of consumers to spend, the strategic Vision Care segment generated profitable growth with innovations for all age groups,” Zeiss stated.
“The reluctance to buy was further reflected in optics for hunting, sport and nature observation. Digital revenue, for example from game cameras for hunters, grew significantly.
“The share of digital services for production, visual effects and post-production also continued to increase in the cinematography business. Zeiss is an innovation driver for film productions and streaming services worldwide. The brand partnerships for mobile imaging and smartphone photography developed very positively.”
Looking ahead, Lamprecht, who is set to step down in April after five years in the CEO role, observed: “The business environment is becoming increasingly challenging. We are nevertheless creating the economic scope for strategically important investments through our broad and future-oriented portfolio.
“This also includes enhancing our innovative strength and transforming ourselves into a data- and process-driven organization.”
Overall, the company is anticipating a “moderate” increase in sales for the current financial year, suggesting that revenues would be likely to exceed €11 billion when reported next December.
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