<SEC-DOCUMENT>0001193125-20-147189.txt : 20200622
<SEC-HEADER>0001193125-20-147189.hdr.sgml : 20200622
<ACCEPTANCE-DATETIME>20200520150903
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001193125-20-147189
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20200520

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ASML HOLDING NV
		CENTRAL INDEX KEY:			0000937966
		STANDARD INDUSTRIAL CLASSIFICATION:	SPECIAL INDUSTRY MACHINERY, NEC [3559]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		DE RUN 6501
		CITY:			DR VELDHOVEN
		STATE:			P7
		ZIP:			5504
		BUSINESS PHONE:		31402683000

	MAIL ADDRESS:	
		STREET 1:		P.O. BOX 324
		CITY:			AH VELDHOVEN
		STATE:			P7
		ZIP:			5500

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ASM LITHOGRAPHY HOLDING NV
		DATE OF NAME CHANGE:	19950215
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<TYPE>CORRESP
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<TD VALIGN="bottom" COLSPAN="5" ALIGN="center">S<SMALL>KADDEN</SMALL>, A<SMALL>RPS</SMALL>, S<SMALL>LATE</SMALL>, M<SMALL>EAGHER</SMALL> &amp; F<SMALL>LOM</SMALL> (UK) <SMALL>LLP</SMALL></TD></TR>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center">40 BANK STREET</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
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<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">CANARY WHARF</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">LONDON E14 5DS <U></U></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></P>
<P STYLE="font-size:8pt; margin-top:0pt; margin-bottom:0pt" align="left">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">TEL: (020) 7519-7000</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">FAX: (020) 7519-7070</P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">www.skadden.com</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">AFFILIATE&nbsp;OFFICES</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></P>
<P STYLE="font-size:8pt; margin-top:0pt; margin-bottom:0pt" align="left">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">BOSTON</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">CHICAGO</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">HOUSTON</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">LOS ANGELES</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">NEW YORK</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">PALO ALTO</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">WASHINGTON, D.C.</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">WILMINGTON</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U></P>
<P STYLE="font-size:8pt; margin-top:0pt; margin-bottom:0pt" align="left">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">BEIJING</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">BRUSSELS</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">FRANKFURT</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">HONG KONG</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">MOSCOW</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">MUNICH</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">PARIS</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S&Atilde;O PAULO</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">SEOUL</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">SHANGHAI</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">SINGAPORE</P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">TOKYO</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">TORONTO</P></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:56%; font-size:10pt; font-family:Times New Roman" ALIGN="center">May 20, 2020 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Via EDGAR </I></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Securities and Exchange Commission </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Division of Corporation Finance </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">100 F Street, NE </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Washington, D.C. 20549 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">U.S.A. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Attention: Melissa Kindelan, Senior Staff Accountant; Eiko Yaoita Pyles, Staff Accountant </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">Re:</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><U>ASML Holding N.V. <FONT STYLE="white-space:nowrap">20-F</FONT> Filed February 12, 2020 (File No:
001-33463)</U> </P></TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Dear Ms.&nbsp;Kindelan and Ms.&nbsp;Pyles: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On behalf of ASML Holding N.V. (&#147;<B>ASML</B>&#148; or the &#147;<B>Company</B>&#148;), we are writing to respond to the comments received
from the staff of the Division of Corporate Finance (the &#147;<B>Staff</B>&#148;) of the Securities and Exchange Commission by letter to Mr.&nbsp;Roger&nbsp;J.M. Dassen, dated May 7, 2020, with respect to the Company&#146;s Annual Report on Form <FONT
STYLE="white-space:nowrap">20-F</FONT> for the year ended December 31, 2019 (the &#147;<B>Annual Report</B>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Set forth below are
the responses to the Staff&#146;s comments, which for the convenience of the Staff have been provided in each case following the text of the comment in the Staff&#146;s letter. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Form 20-F for the Fiscal Year ended December 31, 2019 </U></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>Notes to the Consolidated Financial Statements </U></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>Revenue
from contracts with customers, page 141 </U></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">Comment 1:</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><I>You disclose that transfer of control and recognition of revenue occurs for new system sales upon either delivery or acceptance of the system. Please tell us how you considered whether control transfers over time as these
systems appear to include specialized equipment and it is unclear whether you have an enforceable right to payment for performance completed to date. Further, expand your disclosures to clarify these terms. Refer to ASC <FONT
STYLE="white-space:nowrap">606-10-25-27.</FONT></I></TD></TR></TABLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Securities and Exchange Commission </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">May 20, 2020 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"> Page
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<TD VALIGN="top">Response:</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">When ordering a new system, ASML&#146;s customers choose certain factory options from ASML&#146;s product catalogue to add to ASML&#146;s base system, creating their desired configuration. Throughout most of the production cycle
the new systems are standardized and interchangeable, until a point in the final stages where the system starts to be configured for a specific purchase order. Once completed, the system goes through a Factory Acceptance Test for the customer to
verify whether the system meets its standard specifications and any additional technical and performance criteria agreed with the customer., as well as to grant approval for ASML to ship the system. If after configuring a system for a specific
purchase order the customer was to cancel, ASML can rework the system configuration without significant costs relative to the total costs of the system and sell the system for a similar profit. Additionally, ASML is not restricted contractually from
readily directing a system for another use until transfer of legal title. ASML continually reallocates its inventory production to best match the changing requested delivery dates of its customers. As a result, the systems are determined to have an
alternative use, in accordance with ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">606-10-25-28</FONT></FONT></FONT> and ASC 606-
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">10-55-8</FONT></FONT> through 10. As the systems have an alternative use, it was determined control does not transfer over time in accordance with ASC
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">606-10-25-27(c).</FONT></FONT></FONT> ASML will enhance its disclosure in future filings by including its determination that systems are concluded to
have alternative use.</TD></TR>
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<TD VALIGN="bottom">ASML also acknowledges the Staff&#146;s comment to expand its disclosure to address whether ASML has an enforceable right to payment for work completed to date. In an effort to provide more clear disclosure on contract terms,
ASML will also disclose in its future filings that ASML&#146;s contracts with customers typically contain cancellation penalties that provide economic protection from the risk of customer cancellation.</TD></TR>
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<TD VALIGN="top">Comment 2:</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><I>You indicate that time based software licenses and related services are sold together, not considered individually distinct, and the transfer of control takes place over the license term. Please tell us the nature of these
related services and explain why they are not distinct from the software license. Further, tell us the amount of revenue recognized for these arrangements for each period presented and, to the extent material, revise your disclosures accordingly.
Refer to ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">606-10-25-21.</FONT></FONT></FONT></I></TD></TR>
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<TD VALIGN="top">Response:</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">ASML acknowledges the Staff&#146;s request to understand the revenue recognized in accordance with its accounting policy for time-based software licenses and related services, as well as if this revenue recognized is material.
ASML has one product offering that is sold through a time- based license agreement, for which revenue is recognized under this accounting policy. The amount of revenue recognized for these arrangements for the years ended December&nbsp;31 2019, 2018
and 2017 was &#128;105&nbsp;million, &#128;107&nbsp;million and &#128;96&nbsp;million, respectively, which is approximately 1% of each year&#146;s total revenue. ASML considers the revenues from these arrangements, and any potential allocation among
the promises of these contracts, to be immaterial.</TD></TR>
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<TD VALIGN="bottom">ASML also acknowledges the Staff&#146;s request to better understand the nature of these arrangements and its conclusion that the related services are not distinct from the software license. A customer enters into these
arrangements for ASML to assist the customer in optimizing its chip designs through a combination of using ASML&#146;s software and the related services from ASML&#146;s engineers. The agreements contain a right to use a software product, through a
time-based license, and related support services, for a period ordinarily between 2 to 5 years. The related support services include continuous customization of the software to meet customer technical requirements, consulting advice, providing
available software updates, assistance in using the software, troubleshooting and general customer service support. ASML has expert engineers continuously available to support the customer throughout the license period.</TD></TR>
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<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">As the customers chip designs change over the license term, the software requires adaptation to meet the desired use of the customer, which can only be performed by ASML. The support services thus significantly modify and
customize the software and its functionality throughout</TD></TR></TABLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Securities and Exchange Commission </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">May 20, 2020 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"> Page
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<TD VALIGN="bottom">the license term, adapting to rapidly changing customer requirements over time. As a result, the support services are integral to the customer&#146;s ability to continue to use the software license in the rapidly changing
technological environment, and the benefit the customer can derive from the software license on its own is thus limited. This is further supported by ASML&#146;s experience that a customer would not purchase the software without the related support
services.</TD></TR>
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<TD VALIGN="bottom">In accordance with ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">606-10-25-19(b),</FONT></FONT></FONT> ASC
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">606-10-25-21</FONT></FONT></FONT> through 22 and ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">606-10-55-364</FONT></FONT>
through 366, ASML has concluded the benefit that the customer could obtain from the software license over the contract term without the support services would be significantly limited. As a result, ASML&#146;s promises to grant the software license
and to provide the expected support services are, in effect, inputs that together fulfil a single promise to deliver a combined item to the customer, in the context of the contract.</TD></TR>
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<TD VALIGN="bottom">ASML will enhance its disclosure in future filings by including its basis for concluding the promises are not individually distinct, stating: &#147;The licenses and the related service are not considered to be individually
distinct as the support services are integral to the customer&#146;s ability to continue to use the software license in the rapidly changing technological environment.&#148;</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">***** </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Please
send a copy of any additional correspondence to the undersigned at 40 Bank Street, Canary Wharf, London E14 5DS, United Kingdom, facsimile +44 20 7072 7183. If you would like to discuss any aspect of the Company&#146;s response, please call me on
+44 777 962 2129. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">Sincerely, </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">/s/ James A. McDonald </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">James A. McDonald </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left">cc:</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><I>ASML Holding N.V.</I> </P></TD></TR></TABLE>
<P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Roger J.M. Dassen </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Robert Roelofs
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