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Semiconductor Equipment Maker ASML 4Q Profit Quadruples

ASML Holding NV, the supplier of semiconductor equipment to chipmakers, reported Wednesday that fourth-quarter net profit almost quadrupled from a year earlier, crediting strong demand from clients and an increase in market share.

Net profit was 205.5 million euros ($265.2 million), up from 51.6 million euros, while sales almost doubled from 547.9 million euros to 1.07 billion euros ($1.38 billion). For the full year 2006, net profit was 624.7 million euros ($806.3 million), doubling from 311.5 million euros, while sales increased 42% to 3.60 billion euros($4.65 billion).

That 42% increase came "within an overall semiconductor lithography equipment market, which grew by an estimated 34%," evidence the company was winning market share, Chief Executive Eric Meurice said in a statement.

Shares rose 4.9% to 19.73 euros ($25.47) in early trading in Amsterdam.

ASML makes lithography machines, which are used to map out the circuitry of semiconductors. Customers of the Veldhoven, Netherlands-based company include Intel Corp. and Samsung Electronics, among others.

"We expect 2007 to be another year of increased sales," Meurice said. "Our optimism is supported by our strong backlog and the expected industry ramp-up."

He said clients would be stocking up on machines to make flash memory chips in the first half of the year.

At year-end 2006, ASML's order backlog stood at 2.15 billion euros ($2.78 billion), up less than one percent from 2.13 billion euros the previous quarter.

But not all analysts were as enthusiastic about prospects as ASML. "The company didn't provide a clear outlook for the order intake in the first quarter, which might point towards increased uncertainty within the semiconductor industry," ING analyst Marcel Achterberg said. He rates the shares at hold.