ASML Holding (ASML) 20-F/A 26 Feb 10 2009 FY Annual report (foreign) (amended) Financial data

Document and Company Informatio

Document and Company Information (EUR €)
	12 Months Ended Dec. 31, 2009
Document and Company Information [Abstract]
Entity Registrant Name	ASML HOLDING NV
Entity Central Index Key	0000937966
Document Type	20-F
Document Period End Date	2009-12-31
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float	$10,369,424,640
Entity Common Stock, Shares Outstanding	433,638,976

Consolidated Statements of Oper

Consolidated Statements of Operations (EUR €)
In Thousands, except Per Share data	12 Months Ended Dec. 31, 2009		12 Months Ended Dec. 31, 2008		12 Months Ended Dec. 31, 2007
Statements of Operations [Abstract]
Net system sales	$1,174,858		$2,516,762		$3,351,281
Net service and field option sales	421,205		436,916		416,904
Total net sales	1,596,063		2,953,678		3,768,185
Cost of system sales	852,417		1,631,069		1,943,779
Cost of service and field option sales	285,254		307,095		274,747
Total cost of sales	1,137,671		1,938,164		2,218,526
Gross profit on sales	458,392		1,015,514		1,549,659
Research and development costs	466,761	[1]	516,128	[1]	486,141	[1]
Amortization of in-process research and development costs	0		0		23,148
Selling, general and administrative costs	156,644		212,341		225,668
Income (loss) from operations	(165,013)		287,045		814,702
Interest income	42,766		72,497		78,165
Interest expense	(49,303)		(49,898)		(44,714)
Income (loss) from operations before income taxes	(171,550)		309,644		848,153
(Provision for) benefit from income taxes	20,625		12,726		(177,152)
Net income (loss)	($150,925)		$322,370		$671,001
Basic net income (loss) per ordinary share	-0.35		0.75		1.45
Diluted net income (loss) per ordinary share	-0.35		0.74		1.41
Number of ordinary shares used in computing per share amounts (in thousands)
Basic	432,615		431,620		462,406
Diluted	432,615		434,205		485,643
[1]As of January 1, 2009, research and development credits are presented as part of research and development costs. The comparative figures for 2007 and 2008 have been adjusted accordingly.

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (EUR €)
In Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Statements of Comprehensive Income [Abstract]
Net income (loss)	($150,925)	$322,370	$671,001
Loss on foreign currency translation, net of taxes	(8,592)	(12,734)	(23,294)
Gain (loss) on derivative instruments, net of taxes	6,494	(43,579)	(3,450)
Comprehensive income	($153,023)	$266,057	$644,257

Consolidated Balance Sheets

Consolidated Balance Sheets (EUR €)
In Thousands	Dec. 31, 2009	Dec. 31, 2008
Assets
Cash and cash equivalents	$1,037,074	$1,109,184
Accounts receivable, net	377,439	463,273
Finance receivables, net	21,553	6,225
Current tax assets	11,286	87,560
Inventories, net	963,382	999,150
Deferred tax assets	119,404	71,780
Other assets	218,746	236,077
Total current assets	2,748,884	2,973,249
Finance receivables, net	0	31,030
Deferred tax assets	133,263	148,133
Other assets	77,054	88,197
Goodwill	131,462	131,453
Other intangible assets, net	18,128	26,692
Property, plant and equipment, net	618,706	540,640
Total non-current assets	978,613	966,145
Total assets	3,727,497	3,939,394
Liabilities
Accounts payable	206,226	193,690
Accrued and other liabilities	817,361	789,788
Current tax liabilities	15,032	20,039
Provisions	2,504	4,678
Deferred tax liabilities	3,047	148
Total current liabilities	1,044,170	1,008,343
Long-term debt	663,102	647,050
Deferred and other tax liabilities	188,404	209,699
Provisions	12,694	15,495
Accrued and other liabilities	44,359	70,038
Total non-current liabilities	908,559	942,282
Total liabilities	1,952,729	1,950,625
Shareholders' Equity
Cumulative Preference Shares; EUR 0.02 nominal value; 3,150,005,000 shares authorized; none issued and outstanding at December 31, 2008 and 2009	0	0
Ordinary Shares; EUR 0.09 and EUR 0.01 nominal value; respectively 700,000,000 and 10,000 shares authorized; respectively 432,073,534 and none issued and outstanding at December 31, 2008; respectively 433,638,976 and none issued and outstanding at December 31, 2009	39,028	38,887
Share premium	476,261	474,765
Treasury shares at cost	(218,203)	(253,436)
Retained earnings	1,450,156	1,698,929
Accumulated other comprehensive income	27,526	29,624
Total shareholders' equity	1,774,768	1,988,769
Total liabilities and shareholders' equity	$3,727,497	$3,939,394

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (EUR €)
	Dec. 31, 2009	Dec. 31, 2008
Shareholders' Equity
Cumulative Preference Shares, Nominal value	0.02	0.02
Cumulative Preference Shares, Authorized (actual number of shares)	3,150,005,000	3,150,005,000
Cumulative Preference Shares, Issued (actual number of shares)	0	0
Cumulative Preference Shares, Outstanding (actual number of shares)	0	0
Ordinary Shares, Nominal value	0.09	0.09
Ordinary Shares, Authorized (actual number of shares)	700,000,000	700,000,000
Ordinary Shares, Issued (actual number of shares)	444,480,095	444,480,095
Ordinary Shares, Outstanding (actual number of shares)	433,638,976	432,073,534

Consolidated Statements of Shar

Consolidated Statements of Shareholders Equity (EUR €)
In Thousands, except Share data	Issued and outstanding Share s		Share Premium		Treasury Share s at cost		Retained Earnings		Accumulated Other Comprehensive Income	Total
Shares, Beginning Balance at Dec. 31, 2006	477,099,000
Beginning Balance at Dec. 31, 2006	$10,051		€1,195,034		(€401,000)		€1,231,237		€112,681	$2,148,003
Components of comprehensive income:
Net income (loss)							671,001			671,001
Foreign Currency Translation, net of taxes									(23,294)	(23,294)
Gain (loss) on derivative instruments, net of taxes									(3,450)	(3,450)
Share-based payments			16,506							16,506
Cumulative effect of applying the provisions of ASC 740							(7,648)			(7,648)
Purchase of shares in conjunction with conversion rights of bond holders and share-based payment plans	(970)	[2]			(358,886)	[2]				(359,856)	[2]
Purchase of shares in conjunction with conversion rights of bond holders and share based payment plans, Shares	(17,000,000)	[2]
Issuance of shares in conjunction with convertible bonds	718		288,360		130,317		(35,366)			384,029
Issuance of shares in conjunction with convertible bonds, shares	26,232,000									26,232,275
Capital repayment	29,748	[3]	(1,041,605)	[3]						(1,011,857)	[3]
Capital repayment, shares	(55,093,000)	[3]
Cancellation of treasury shares	(509)		(48,563)		401,000		(351,928)
Tax benefit from stock options			9,006							9,006
Issuance of shares and stock options	168		45,108		29,676		(6,388)			68,564
Issuance of shares and stock options, shares	4,388,000
Shares, Ending Balance at Dec. 31, 2007	435,626,000
Ending Balance at Dec. 31, 2007	39,206		463,846		(198,893)		1,500,908		85,937	1,891,004
Components of comprehensive income:
Net income (loss)							322,370			322,370
Foreign Currency Translation, net of taxes									(12,734)	(12,734)
Gain (loss) on derivative instruments, net of taxes									(43,579)	(43,579)
Share-based payments			13,535							13,535
Purchase of shares in conjunction with share based payment plans	(450)				(87,155)					(87,605)
Purchase of shares in conjunction with share based payment plans, Shares	(5,000,000)
Dividend paid							(107,841)			(107,841)
Tax benefit from stock options			2,144							2,144
Issuance of shares and stock options	131		(4,760)		32,612		(16,508)			11,475
Issuance of shares and stock options, shares	1,448,000
Shares, Ending Balance at Dec. 31, 2008	432,074,000	[1]
Ending Balance at Dec. 31, 2008	38,887		474,765		(253,436)		1,698,929		29,624	1,988,769
Components of comprehensive income:
Net income (loss)							(150,925)			(150,925)
Foreign Currency Translation, net of taxes									(8,592)	(8,592)
Gain (loss) on derivative instruments, net of taxes									6,494	6,494
Share-based payments			13,394							13,394
Dividend paid							(86,486)	[4]		(86,486)	[4]
Tax benefit from stock options			1,954							1,954
Issuance of shares and stock options	141		(13,852)		35,233		(11,362)			10,160
Issuance of shares and stock options, shares	1,565,000
Shares, Ending Balance at Dec. 31, 2009	433,639,000	[1]
Ending Balance at Dec. 31, 2009	$39,028		€476,261		(€218,203)		€1,450,156		€27,526	$1,774,768
[1]As of December 31, 2009, the number of issued shares was 444,480,095. This includes the number of issued and outstanding shares of 433,638,976 and the number of treasury shares of 10,841,119. As of December 31, 2008, the number of issued shares was 444,480,095. This includes the number of issued and outstanding shares of 432,073,534 and the number of treasury shares of 12,406,561.
[2]In 2007, 17,000,000 shares were repurchased, some of which were re-issued in order to cover exercised stock options and to satisfy the conversion rights of holders of our 5.50 percent Convertible Subordinated Notes. See Note 26 for further information.
[3]In 2007, as part of a capital repayment program, EUR 1,012 million of equity was repaid to our shareholders and the number of outstanding ordinary shares was reduced by 11 percent. See Note 26 for further information.
[4]In 2009, ASML paid out a dividend of EUR 86 million to its shareholders, see Note 25 for further information.

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (EUR €)
In Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Cash Flows from Operating Activities
Net income (loss)	($150,925)	$322,370	$671,001
Adjustments to reconcile net income (loss) to net cash flows from operating activities:
Depreciation and amortization	140,201	119,190	126,344
Impairment	15,896	25,109	9,022
Loss on disposals of property, plant and equipment	4,053	4,257	14,210
Share-based payments	13,394	13,535	16,506
Allowance for doubtful debts	1,889	188	(178)
Allowance for obsolete inventory	86,636	139,628	79,592
Deferred income taxes	(49,423)	(34,155)	106,403
Changes in assets and liabilities:
Accounts receivable	97,540	132,147	42,410
Inventories	(158,024)	(87,804)	(438,746)
Other assets	4,893	(76,342)	(86,053)
Accounts payable	10,430	(94,375)	(38,944)
Current income taxes	71,267	(158,277)	(74,428)
Other liabilities	9,937	(24,725)	273,872
Net cash provided by operating activities	97,764	280,746	701,011
Cash Flows from Investing Activities
Purchases of property, plant and equipment	(104,959)	(259,770)	(179,152)
Proceeds from sale of property, plant and equipment	6,877	0	5,011
Purchases of intangible assets	0	(35)	0
Acquisition of subsidiary (net of cash acquired)	0	0	(188,011)
Net cash used in investing activities	(98,082)	(259,805)	(362,152)
Cash Flows from Financing Activities
Capital repayment	0	0	(1,011,857)
Purchase of shares in conjunction with conversion rights of bondholders and share-based payments	0	(87,605)	(359,856)
Net proceeds from issuance of shares and stock options	11,073	11,475	63,307
Dividend paid	(86,486)	(107,841)	0
Net proceeds from issuance of bond	0	0	593,755
Net proceeds from other long-term debt	32	0	0
Repayment of debt	(17)	(2,411)	(9,718)
Tax benefits from stock options	1,954	2,144	9,006
Net cash used in financing activities	(73,444)	(184,238)	(715,363)
Net cash flows	(73,762)	(163,297)	(376,504)
Effect of changes in exchange rates on cash	1,652	845	(7,717)
Net decrease in cash and cash equivalents	(72,110)	(162,452)	(384,221)
Cash and cash equivalents at beginning of the year	1,109,184	1,271,636	1,655,857
Cash and cash equivalents at end of the year	1,037,074	1,109,184	1,271,636
Supplemental Disclosures of Cash Flow Information:
Interest paid	40,235	40,247	38,936
Taxes paid (received)	(36,705)	167,360	167,268
Supplemental non-cash investing and financing activities:
Conversion of bonds into 26,232,275, 0 and 0 ordinary shares respectively in 2007, 2008 and 2009	$0	$0	$378,413

1_Consolidated Statements of Ca

Consolidated Statements of Cash Flows (Parenthetical) (EUR €)
	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Supplemental non-cash investing and financing activities:
Conversion of bonds into ordinary shares	0	0	26,232,275

General information Summary of

General information Summary of significant accounting policies
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
General information / Summary of significant accounting policies [Abstract]
General information / Summary of significant accounting policies	1. General information / Summary of significant accounting policies ASML Holding N.V., with its corporate headquarters in Veldhoven, the Netherlands, is engaged in the development, production, marketing, sale and servicing of advanced semiconductor equipment systems exclusively consisting of lithography systems. ASMLs principal operations are in the Netherlands, the United States of America and Asia. The Companys shares are listed for trading in the form of registered shares on NASDAQ Global Select Market (New York shares) and in the form of registered shares on Euronext Amsterdam (Amsterdam Shares). The principal trading market of the Companys ordinary shares is Euronext Amsterdam. The accompanying consolidated financial statements include the financial statements of ASML Holding N.V. headquartered in Veldhoven, the Netherlands, and its consolidated subsidiaries (together referred to as ASML or the Company). Basis of preparation The accompanying consolidated financial statements are stated in thousands of Euros (EUR) unless indicated otherwise. ASML follows accounting principles generally accepted in the United States of America (U.S.GAAP). ASMLs reporting currency is the euro. Use of estimates The preparation of ASMLs consolidated financial statements in conformity with U.S.GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities on the balance sheet dates, and the reported amounts of revenue and expenses during the reported periods. Actual results could differ from those estimates. Principles of consolidation The consolidated financial statements include the accounts of ASML Holding N.V. and all of its majority-owned subsidiaries. All intercompany profits, balances and transactions have been eliminated in the consolidation. Subsidiaries Subsidiaries are all entities over which ASML has the power to govern financial and operating policies generally accompanying a shareholding of more than one-half of the voting rights. As from the date that these criteria are met, the financial data of the relevant company are included in the consolidation. Acquisitions of subsidiaries are included on the basis of the purchase accounting method. The cost of acquisition is measured as the cash payment made, the fair value of other assets distributed and the fair value of liabilities incurred or assumed at the date of exchange, plus the costs that can be allocated directly to the acquisition. The excess of the costs of an acquired subsidiary over the net of the amounts assigned to assets acquired and liabilities incurred or assumed is capitalized as goodwill. Foreign currency translation The financial information for subsidiaries outside the euro-zone is generally measured using local currencies as the functional currency. The financial statements of those foreign subsidiaries are translated into Euros in the preparation of ASMLs consolidated financial statements. Assets and liabilities are translated into Euros at the exchange rate in effect on the respective balance sheet dates

Fair value measurements

Fair value measurements
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Fair value measurements [Abstract]
Fair value measurements	2. Fair value measurements Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement hierarchy prioritizes the inputs to valuation techniques used to measure fair value as follows: Level1:Valuations based on inputs such as quoted prices for identical assets or liabilities in active markets that the entity has the ability to access. Level2:Valuations based on inputs other than level1 inputs such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. Level3:Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level1)and the lowest priority to unobservable inputs (Level3). A financial instruments fair value is based on the lowest level of any input that is significant in the fair value measurement hierarchy. Financial assets and financial liabilities measured at fair value on a recurring basis Cash and cash equivalents include short-term deposits, investments in money market funds and interest-bearing bank accounts for which fair value measurements are all based on quoted prices for similar assets or liabilities. The principal market in which ASML executes its derivative contracts is the institutional market in an over-the-counter environment with a high level of price transparency. The market participants usually are large commercial banks. The valuation inputs for ASMLs derivative contracts are based on quoted prices and quoting pricing intervals from public data sources; they do not involve management judgment. The valuation technique used to determine the fair value of forward contracts (used for hedging purposes) is the Net Present Value technique which is the estimated amount that a bank would receive or pay to terminate the forward contracts at the reporting date, taking into account current interest rates and current exchange rates. The valuation technique used to determine the fair value of forward contracts approximates the net present value of future cash flows. The valuation technique used to determine the fair value of interest rate swaps (used for hedging purposes) is the Net Present Value technique which is the estimated amount that a bank would receive or pay to terminate the swap agreements at the reporting date, taking into account current interest rates. The valuation technique used to determine the fair value of interest rate swaps approximates the net present value of future cash flows. The carrying amount of the Eurobond consists of its principal amount adjusted for fair value changes in interest rate swaps. The Eurobond serves as a hedged item in a fair value hedge relationship in which ASML hedges the variabi

Market risks and derivatives

Market risks and derivatives
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Market risks and derivatives [Abstract]
Market risk and derivatives	3. Market risks and derivatives The Company is exposed to a variety of financial risks: market risks (including foreign currency exchange risk and interest rate risk), credit risk, liquidity and capital risk. The overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potentially adverse effects on the Companys financial performance. The Company uses derivative instruments to hedge certain risk exposures: None of the transactions are entered into for trading or speculative purposes. ASML believes that market information is the most reliable and transparent means of measurement for its derivative instruments that are measured at fair value. Foreign currency risk management The Company uses the euro as its invoicing currency in order to limit the exposure to foreign currency movements. Exceptions may occur on a customer by customer basis. To the extent that invoicing is done in a currency other than the euro, the Company is exposed to foreign currency risk. It is the Companys policy to hedge material transaction exposures, such as forecasted sales and purchase transactions and accounts receivable and payable. The Company hedges these exposures through the use of currency contracts (foreign exchange options and forward contracts). In 2009, the Company identified four ineffective cash flow hedges related to forecasted sales transactions. This resulted in a loss recognized in sales for an amount of EUR10.7million (2008: loss of EUR18.0million). The effectiveness of all outstanding hedge contracts is monitored on a quarterly basis throughout the life of the hedges. As of December31, 2009 other comprehensive income includes EUR56.1million loss (net of taxes: EUR41.8million loss; 2008: EUR49.2million loss) representing the total anticipated loss to be released to sales, and EUR0.7million gain (net of taxes: EUR0.5million gain; 2008: EUR1.4million gain) to be charged to cost of sales, which will offset the higher EUR equivalent of foreign currency denominated forecasted sales and purchase transactions. It is anticipated that an amount of EUR34.7million loss will be charged to sales and EUR0.7million gain will be released to cost of sales over the next twelve months, as the forecasted sales and purchase transactions occur. The remainder of the loss is anticipated to be charged to sales between one and two years, as the forecasted sales transactions occur. It is the Companys policy to hedge material remeasurement exposures. These net exposures from certain monetary assets and liabilities in non-functional currencies are hedged with forward contracts. In 2009, the Company decided to change its hedging policy of managing material currency translation exposures resulting predominantly from ASMLs U.S.dollar net investments by hedging these partly with forward contracts. The Company decided to no longer hedge these U.S.dollar translation exposures. The related foreign currency translation amounts included in cumulative translation adjustment for the year 2009 was EUR13.1million loss (2008: EUR12.7million gain). The cumulative gain included in cumulative translation adju

Cash and cash equivalents

Cash and cash equivalents
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Cash and cash equivalents [Abstract]
Cash and cash equivalents	4. Cash and cash equivalents Cash and cash equivalents at December31, 2009 include short-term deposits of EUR652million (2008: EUR833million), investments in money market funds of EUR303million (2008: EUR201million) and interest-bearing bank accounts of EUR82million (2008: EUR75million). Cash and cash equivalents have insignificant interest rate risk and remaining maturities of three months or less at the date of acquisition. No further restrictions on usage of cash and cash equivalents exist. The carrying amount of these assets approximates their fair value.

Accounts receivable

Accounts receivable
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Accounts receivable [Abstract]
Accounts receivable	5. Accounts receivable Accounts receivable consist of the following: As of December 31 2008 2009 (in thousands) EUR EUR Accounts receivable, gross 464,703 380,678 Allowance for doubtful receivables (1,430 ) (3,239 ) Accounts receivable, net 463,273 377,439 The carrying amount of the accounts receivable approximates the fair value. The maximum exposure to credit risk at December31, 2009 is the fair value of the accounts receivable mentioned above. ASML has taken additional measures to mitigate credit risk when considered appropriate by means of e.g. letters of credit, down payments and retention of ownership, which is intended to enable ASML to recover the systems in the event a customer defaults on payment. Movements of the allowance for doubtful receivables are as follows: 2008 2009 (in thousands) EUR EUR Balance at beginning of year (1,385 ) (1,430 ) Utilization of the provision 143 80 Addition for the year1 (188 ) (1,889 ) Balance at end of year (1,430 ) (3,239 ) 1 Addition for the year is recorded in cost of sales.

Finance receivables

Finance receivables
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Finance receivables [Abstract]
Finance receivables	6. Finance receivables Finance receivables consist of the net investment in sales-type leases. The sales-type leases transfer ownership of the systems to the lessee by the end of the lease term. The average lease term is two years. The following table lists the components of the finance receivables as of December31, 2009: As of December 31 2008 2009 (in thousands) EUR EUR Finance receivables, gross 40,866 22,444 Unearned interest (3,611 ) (891 ) Finance receivables, net 37,255 21,553 Current portion of finance receivables, gross 6,781 22,444 Current portion of unearned interest (556 ) (891 ) Non-current portion of finance receivables, net 31,030 At December31, 2009, the finance receivables due for payment in each of the next five years and thereafter are as follows: (in thousands) EUR 2010 22,444 2011 2012 2013 2014 Thereafter Total 22,444

Inventories

Inventories
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Inventories [Abstract]
Inventories	7. Inventories Inventories consist of the following: As of December31 2008 2009 (in thousands) EUR EUR Raw materials 140,615 175,045 Work-in-process 655,505 799,390 Finished products 392,910 214,248 Total inventories, gross 1,189,030 1,188,683 Allowance for obsolescence and/or lower market value (189,880 ) (225,301 ) Total inventories, net 999,150 963,382 A summary of activity in the allowance for obsolescence is as follows: 2008 2009 (in thousands) EUR EUR Balance at beginning of year (129,045 ) (189,880 ) Addition for the year (139,628 ) (86,636 ) Effect of exchange rates (17 ) (260 ) Release of the provision 2,113 Utilization of the provision 76,697 51,475 Balance at end of year (189,880 ) (225,301 ) In 2009, the addition for the year is recorded in cost of sales for an amount of EUR68.1million and RD costs for an amount of EUR18.5million (2008: cost of sales EUR139.6million). As of December31, 2009, the allowance for inventory obsolescence amounted to EUR225.3million (2008: EUR189.9million). The increase in the allowance for inventory obsolescence is mainly due to a reassessment by the Company in 2009 of expected future demand based on the unexpected customers response to the financial and economic crisis. This resulted in an increase in allowance for inventory obsolescence for different types of non-leading-edge systems compared to prior year and additional parts which management believes cannot be sold. Utilization of the provision mainly relates to sale and scrap of impaired inventories. At the end of 2008, customers in the market segment for Logic technology underestimated the ramp-up of 45 nm technology used in, among others, advanced internet devices and smart phones, which unexpectedly increased demand for our non-leading-edge immersion systems in 2009 (mainly XT:1700i). As a result we made EUR64.8million profit on the sale of inventories that had been previously written down.

Other assets

Other assets
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Other assets [Abstract]
Other assets	8. Other assets Other current assets consist of the following: As of December 31 2008 2009 (in thousands) EUR EUR Advance payments to Zeiss 103,798 73,759 Prepaid expenses 57,471 46,808 Derivative instruments 39,240 47,436 VAT 18,693 25,211 Other 16,875 25,532 Total other current assets 236,077 218,746 Zeiss is the Companys sole supplier of lenses and, from time to time, receives non-interest bearing advance payments from the Company that assist in financing Zeiss work-in-process and thereby secure lens deliveries to the Company. Amounts owed under these advance payments are repaid through lens deliveries. Prepaid expenses include a tax prepayment on intercompany profit, not realized by the group of EUR25.4million in 2009 (2008: EUR26.2million). Derivative financial instruments consist of currency contracts and the current part of the fair value of interest rate swaps which includes accrued interest. Other non-current assets consist of the following: As of December 31 2008 2009 (in thousands) EUR EUR Derivative instruments 53,206 55,948 Loan to Micronic 13,000 Compensation plan assets1 7,103 8,520 Prepaid expenses 5,542 5,893 Subordinated loan granted to lessor in respect of Veldhoven headquarters2 5,445 5,445 Other 3,901 1,248 Total other non-current assets 88,197 77,054 1 For further details on compensation plan see Note16. 2 For further details on loan granted to lessor in respect of Veldhoven headquarters see Note15. Derivative instruments consist of the non-current part of the fair value of interest rate swaps which includes accrued interest. The loan to Micronic related to a license agreement between Micronic Laser Systems AB and ASML, which was fully repaid in 2009.

Goodwill

Goodwill
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Goodwill [Abstract]
Goodwill	9. Goodwill Changes in goodwill are summarized as follows: 2008 2009 (in thousands) EUR EUR Cost Balance, January 1 128,271 131,453 Effect of exchange rates 3,182 9 Balance, December 31 131,453 131,462 Carrying amount, December 31 131,453 131,462 The goodwill relates to the acquisition of Brion in March 2007. Goodwill is tested for impairment annually on September 30 and whenever events or changes in circumstances indicate that the carrying amount of the goodwill may not be recoverable. For the purpose of impairment testing, goodwill is allocated to the reporting unit Brion. The fair value of the reporting unit Brion is calculated based on the discounted cash flow method (income approach). These calculations use after-tax discounted cash flow projections based on the strategic plan approved by management. The material assumptions used by management for the fair value calculation of the reporting unit are: Cash flow projections for the first six years are based on a significant growth scenario, reflecting the start-up nature of Brion. The projections are built bottom-up, using estimates for revenue, gross profit, RD costs and SGA costs. Brion would reach maturity in the final year of this six year start-up period and grow at a weighted average growth rate of three percent, which Management believes is a reasonable estimate that does not exceed the long-term historical average growth rate for the lithography business in which Brion operates. A discount rate of 14.7percent representing Brions weighted average cost of capital (WACC) is determined using an adjusted version of the Capital Asset Pricing Model. Since Brion is not financed with debt, WACC is assumed to equal Brions cost of equity. The discount rate increased compared to the prior year reflecting the increased market uncertainty. Management believes that the fair value calculated reflects the amount a market participant would be willing to pay. Based on this analysis management believes that the fair value of the reporting unit substantially exceeded its carrying value and that, therefore, goodwill was not impaired as of December31, 2009 and December31, 2008.

Other intangible assets

Other intangible assets
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Other intangible assets [Abstract]
Other intangible assets	10. Other intangible assets Other intangible assets consist of the following: Intellectual Developed Customer In-process property technology relationships RD Other Total (in thousands) EUR EUR EUR EUR EUR EUR Cost Balance, January1, 2008 47,215 23,901 8,063 23,148 2,141 104,468 Additions 35 35 Effect of exchange rates 593 200 54 847 Balance, December31, 2008 47,250 24,494 8,263 23,148 2,195 105,350 Additions Effect of exchange rates 1 1 2 Balance, December31, 2009 47,250 24,495 8,263 23,148 2,196 105,352 Accumulated amortization and impairment Balance, January1, 2008 37,797 3,765 839 23,148 724 66,273 Amortization 5,780 3,840 1,005 867 11,492 Impairment charges 552 552 Effect of exchange rates 249 50 42 341 Balance, December31, 2008 43,577 8,406 1,894 23,148 1,633 78,658 Amortization 3,436 4,019 1,075 254 8,784 Impairment charges Effect of exchange rates (157 ) (42 ) (19 ) (218 ) Balance, December31, 2009 47,013 12,268 2,927 23,148 1,868 87,224 Carrying amount December31, 2008 3,673 16,088 6,369 562 26,692 December31, 2009 237 12,227 5,336 328 18,128 Developed technology, customer relationships, in-process RD and other were obtained from the acquisition of Brion.

Property, plant and equipment

Property, plant and equipment
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Property, plant and equipment [Abstract]
Property, plant and equipment	11. Property, plant and equipment Property, plant and equipment consist of the following: Land, Machinery Furniture, buildings and and Leasehold fixtures and other constructions equipment improvements equipment Total (in thousands) EUR EUR EUR EUR EUR Cost Balance, January1, 2008 183,159 466,930 149,117 257,102 1,056,308 Additions 172,002 107,093 12,319 30,625 322,039 Disposals (382 ) (91,024 ) (8,037 ) (99,443 ) Effect of exchange rates 752 399 425 570 2,146 Balance, December31, 2008 355,531 483,398 153,824 288,297 1,281,050 Additions 74,135 179,050 3,484 7,258 263,927 Disposals (2,247 ) (127,152 ) (2,403 ) (9,457 ) (141,259 ) Effect of exchange rates 360 (2,162 ) 61 386 (1,355 ) Balance, December31, 2009 427,779 533,134 154,966 286,484 1,402,363 Accumulated depreciation and impairment Balance, January1, 2008 47,049 336,989 92,839 198,537 675,414 Depreciation 6,604 54,081 14,961 31,918 107,564 Impairment charges 266 22,324 423 1,544 24,557 Disposals (558 ) (59,671 ) (7,201 ) (67,430 ) Effect of exchange rates 548 (255 ) 80 (68 ) 305 Balance, December31, 2008 53,909 353,468 101,102 231,931 740,410 Depreciation 22,611 63,614 15,851 27,568 129,644 Impairment charges 11,185 155 4,556 15,896 Disposals (2,247 ) (88,815 ) (2,191 ) (9,298 ) (102,551 ) Effect of exchange rates (30 ) 41 12 235 258 Balance, December31, 2009 74,243 339,493 114,929 254,992 783,657

Accrued and other liabilities

Accrued and other liabilities
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Accrued and other liabilities [Abstract]
Accrued and other liabilities	12. Accrued and other liabilities Accrued and other liabilities consist of the following: As of December 31 2008 2009 (in thousands) EUR EUR Deferred revenue 262,209 219,378 Costs to be paid 190,225 208,684 Advances from customers 169,250 274,074 Personnel related items 130,651 114,255 Derivative instruments 67,794 17,471 Standard warranty reserve 35,225 23,208 Other 4,472 4,650 Total accrued and other liabilities 859,826 861,720 Less: long-term portion of accrued and other liabilities 70,038 44,359 Short-term portion of accrued and other liabilities 789,788 817,361 Deferred revenue mainly consists of prepaid extended and enhanced (optic) warranty contracts and award credits regarding free or discounted products or services. Cost to be paid mainly relate to accrued cost for unbilled services provided by vendors including contracted labor, outsourced services and consultancy. Advances from customers consist of down payments made by customers prior to shipment for systems included in ASMLs current product portfolio or systems currently under development. Personnel related items mainly consist of accrued management bonuses, accrued vacation days, accrued vacation allowance, accrued wage tax, social securities and accrued pension premiums. Derivative financial instruments consist of currency contracts and the fair value of interest rate swaps which includes accrued interest. Changes in standard warranty reserve for the years 2008 and 2009 are as follows: 2008 2009 (in thousands) EUR EUR Balance, January 1 73,198 35,225 Additions of the year 30,322 15,047 Utilization of the reserve (35,233 ) (19,360 ) Release of the reserve (33,409 ) (7,666 ) Effect of exchange rates 347 (38 ) Balance, December 31 35,225 23,208 The release of the reserve is due to a change in accounting estimate based on lower than expected historical warranty expenses as a result of an improved learning curve concerning ASMLs systems. The release has been included in cost of sales. In 2009, the reassessments of the warranty reserve, and resulting change in accounting estimate, did not have a material impact. For 2008, the impact of the change in accounting estimate on the consolidated statements of operations and per-share amounts was as follows: Year ended December 31 2008 (in thousands, except per share data) EUR % Income from operations 33,409 11.6% Net income 24,890 7.7% Basic net income per ordinary share 0.06 8.0% Diluted net income per o

Provisions

Provisions
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Provisions [Abstract]
Provisions	13. Provisions Provisions consist of the following: Employee contract Lease contract termination benefits termination costs Total (in thousands) EUR EUR EUR Balance at January1, 2009 2,265 17,908 20,173 Utilization of the provision (2,244 ) (2,747 ) (4,991 ) Unwinding of discount 136 136 Effect of exchange rates (21 ) (99 ) (120 ) Balance at December31, 2009 15,198 15,198 Less: current portion of provisions 2,504 2,504 Non-current portion of provisions 12,694 12,694 In December 2008, ASML announced a restructuring that resulted in the discontinuation of its training center in the United States, downsizing of the United States headquarters and closure of several other locations, reflecting the continuous migration of the semiconductor manufacturing activities to Asia which was accelerated by the financial and economic crisis. The total restructuring costs consisted of employee contract termination benefits and lease contract termination costs. Provision for employee contract termination benefits relates mainly to the reduction of approximately 105 jobs and comprises only personnel costs. The provision for employee contract termination benefits was fully utilized in 2009. Provision for lease contract termination costs relates to an operating lease contract for a building for which no economic benefits are expected. The provision for lease contract termination costs is expected to be utilized by 2017. The restructuring in 2008 resulted in cost savings of EUR9.2million in 2009, consisting of a EUR2.7million decrease in rental expenses and EUR6.5million decrease in employee expenses. The actual savings are in line with the savings that the Company anticipated at the end of 2008. These actions resulted in an approximately similar positive effect on cash flows from operating activities.

Long-term debt

Long-term debt
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Long-term debt [Abstract]
Long-term debt	14. Long-term debt The Companys obligations to make principal repayments under the Eurobond and other borrowing arrangements as of December31, 2009, for the next five years and thereafter and excluding interest expense, are as follows: (in thousands) EUR 2010 14 2011 2012 2013 2014 Thereafter 600,000 Total 600,014 Less: current portion of long-term debt 14 Non-current portion of long-term debt 600,000 Eurobond The following table summarizes the carrying amount of the Companys outstanding Eurobond, including fair value of interest rate swaps used to hedge the change in the fair value of the Eurobond: As of December 31 2008 2009 (in thousands) EUR EUR 5.75percent Eurobond Principal amount 600,000 600,000 Fair value interest rate swaps1 47,050 63,088 Total 647,050 663,088 1 The fair value of the interest rate swaps excludes accrued interest. In June 2007, ASML completed an offering of EUR600million principal amount of its 5.75percent notes due 2017, with interest payable annually on June 13 of each year. The notes are redeemable at the option of ASML, in whole or in part, at any time by paying a make whole premium, and unless previously redeemed, will be redeemed at 100percent of their principal amount on June13, 2017. The Eurobond serves as a hedged item in a fair value hedge relationship in which ASML hedges the variability of changes in the market value of fixed loan coupons payable on the Companys Eurobond due to changes in market interest rates; the fair value changes of the interest rate swaps are recorded on the balance sheet under derivative financial instruments (within other current and non-current assets). Therefore, the carrying amount is only adjusted for fair value changes in interest rate swaps. The following table summarizes estimated fair value of ASMLs Eurobond: 2008 2009 Principal Carrying Principal Carrying As of December 31 Amount Amount Fair Value Amount Amount Fair Value (in thousands) EUR EUR EUR EUR EUR EUR 5.75 percent Eurobond 600,000 647,050 345,585 600,000 663,088 599,232 (Source: Bloomberg Finance LP) The fair value of the Companys Eurobond is estimated based on the quoted market prices as of December31, 2009. The fair value of the Eurobond is lower than the principal amount as a result of an increased implied credit spread. Lines of credit As of December31, 2009, the Company has available credit facilities for a total amount of EUR700million (2008: EUR500million). The EUR700million of available credit facilities consis

Commitments contingencies and g

Commitments contingencies and guarantees
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Commitments contingencies and guarantees [Abstract]
Commitments, contingencies and guarantees	15. Commitments, contingencies and guarantees The Company has various contractual obligations, some of which are required to be recorded as liabilities in the Companys consolidated financial statements, including long- and short-term debt. Others, namely operating lease commitments, purchase obligations and guarantees, are generally not required to be recognized as liabilities on the Companys balance sheet but are required to be disclosed. Lease Commitments and Variable Interests The Company leases equipment and buildings under various operating leases. Operating leases are charged to expense on a straight-line basis. See the Tabular Disclosure of Contractual Obligations below. In December 2003, the FASB issued ASC 810, Consolidation of Variable Interest Entities. Under ASC 810, an enterprise must consolidate a variable interest entity if that enterprise has a variable interest (or a combination of variable interests) that will absorb a majority of the entitys expected losses if they occur, receive a majority of the entitys expected residual returns if they occur, or both. In 2003, ASML moved to its current Veldhoven headquarters. The Company is leasing these headquarters for a period of 15years from an entity (the lessor) that was incorporated by a syndicate of three banks (shareholders) solely for the purpose of leasing this building. The lessors shareholders equity amounts to EUR1.9million. The shareholders each granted a loan of EUR11.6million and a fourth bank granted a loan of EUR12.3million. ASML provided the lessor with a subordinated loan of EUR5.4million and has a purchase option that is exercisable either at the end of the lease in 2018, at a pre-determined price of EUR24.5million, or during the lease at the book value of the assets. The total assets of the lessor entity amounted to approximately EUR54million at inception of the lease. ASML believes that it holds a variable interest in this entity and that the entity is a variable interest entity (VIE) because it is subject to consolidation in accordance with the provisions of ASC 810-10-15-14. The total equity investment at risk is approximately 3.6percent of the lessors total assets and is not considered and cannot be demonstrated, qualitatively or quantitatively, to be sufficient to permit the lessor to finance its activities without additional subordinated financial support provided by any parties, including the shareholders. ASML determined that it is not appropriate to consolidate the VIE as it is not the primary beneficiary. To make this determination, the expected losses and expected residual returns of the lessor were allocated to each variable interest holder based on their contractual right to absorb expected losses and residual returns. The analysis of expected losses and expected residual returns involved determining the expected negative and positive variability in the fair value of the lessors net assets exclusive of variable interests through various cash flow scenarios based upon the expected market value of the lessors net assets. Based on this analysis, ASML determined that other variable interest holders will absorb the maj

Employee benefits

Employee benefits
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Employee benefits [Abstract]
Employee benefits	16. Employee benefits Deferred compensation plans In February 1997, SVG (a company that merged with ASML in May 2001)adopted a non-qualified deferred compensation plan that allowed a select group of management and highly compensated employees and directors to defer a portion of their salary, bonus and directors fees. The plan allowed SVG to credit additional amounts to participants account balances, depending on the amount of the employees contribution, up to a maximum of 5.0percent of an employees annual salary and bonus. In addition, interest is credited to the participants account balances at 120percent of the average Moodys corporate bond rate. For calendar years 2007, 2008 and 2009, participants accounts were credited at 7.16percent, 7.34percent and 9.07percent respectively. SVGs contributions and related interest became 100percent vested in May 2001 with the merger of SVG and ASML. During fiscal years 2007, 2008 and 2009, the expense incurred under this plan was EUR0.1million, EUR0.2million and 0.2million, respectively. As of December31, 2008 and 2009 the Companys liability under the deferred compensation plan was EUR2million and EUR2million respectively. In July 2002, ASML adopted a non-qualified deferred compensation plan for its United States employees that allows a select group of management or highly compensated employees to defer a portion of their salary, bonus, and commissions. The plan allows ASML to credit additional amounts to the participants account balances. The participants divide their funds among the investments available in the plan. Participants elect to receive their funds in future periods after the earlier of their employment termination or their withdrawal election, at least three years after deferral. There were minor plan expenses in 2007, 2008 and 2009. On December31, 2008 and 2009, the Companys liability under the deferred compensation plan was EUR5million and EUR7million, respectively. Pension plans ASML maintains various pension plans covering substantially all of its employees. The Companys approximately 3,600 payroll employees in FTEs in the Netherlands participate in a multi-employer union plan (Bedrijfstakpensioenfonds Metalektro) determined in accordance with the collective bargaining agreements effective for the industry in which ASML operates. This multi-employer plan spans approximately 1,250companies and 156,000 contributing members. The plan monitors its risks on a global basis, not by company or employee, and is subject to regulation by Netherlands governmental authorities. By law (the Netherlands Pension Act), a multi-employer union plan must be monitored against specific criteria, including the coverage ratio of the plans assets to its obligations. This coverage ratio must exceed 100percent for the total plan. Every company participating in a Netherlands multi-employer union plan contributes a premium calculated as a percentage of its total pensionable salaries, with each company subject to the same percentage contribution rate. The pension rights of each employee are based upon the employees average salary during employment. ASMLs net periodic pension cost for

Legal contingencies

Legal contingencies
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Legal contingencies	17. Legal contingencies ASML is party to various legal proceedings generally incidental to its business. ASML also faces exposure from other actual or potential claims and legal proceedings. In addition, ASML customers may be subject to claims of infringement from third parties alleging that the ASML equipment used by those customers in the manufacture of semiconductor products, and/or the methods relating to use of the ASML equipment, infringes one or more patents issued to those third parties. If these claims were successful, ASML could be required to indemnify such customers for some or all of any losses incurred or damages assessed against them as a result of that infringement. The Company accrues for legal costs related to litigation in its statement of operations at the time when the related legal services are actually provided to ASML. From 2001 through late 2004, the Company was party to a series of civil litigations and administrative proceedings in which Nikon alleged ASMLs infringement of Nikon patents relating to lithography. ASML in turn filed claims against Nikon. Pursuant to agreements executed on December10, 2004, ASML, Zeiss and Nikon agreed to settle all pending worldwide patent litigation between the companies. The settlement included an exchange of releases, a cross-license of patents related to lithography equipment used to manufacture semiconductor devices and payments to Nikon by ASML and Zeiss. In connection with the settlement, ASML and Zeiss made settlement payments to Nikon from 2004 to 2007.

Income taxes

Income taxes
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Income taxes [Abstract]
Income taxes	18. Income taxes The components of income (loss) before income taxes are as follows: Year Ended December 31 2007 2008 2009 (in thousands) EUR EUR EUR Netherlands 461,682 141,418 (269,374 ) Non-Netherlands 386,471 168,226 97,824 Total 848,153 309,644 (171,550 ) In addition to the income tax benefit recognized in the consolidated statements of operations, income tax benefits of EUR1.1million have been recognized in equity in the year 2009 related to share-based payment plans and derivative financial instruments (2008: EUR18.2million benefit; 2007: EUR4.5million benefit). The Netherlands statutory tax rate amounted to 25.5percent in 2009, 2008 and 2007. Taxation for other jurisdictions is calculated at the rates prevailing in the relevant jurisdictions. The reconciliation between the (provision for) benefit from income taxes shown in the consolidated statements of operations, based on the effective tax rate, and expense based on the Netherlands tax rate, is as follows: Year Ended December 31 2007 2008 2009 (in thousands) EUR % EUR % EUR % Income (loss) from operations before income taxes 848,153 100.0 309,644 100.0 (171,550 ) 100.0 Income tax (expense) benefit based on Netherlands rate (216,279 ) 25.5 (78,959 ) 25.5 43,745 25.5 Change in statutory tax rate 6 Different tax rates 16,538 (1.9 ) 26,764 (8.6 ) 18,482 10.8 Other credits and non-taxable items 22,583 (2.7 ) 64,921 (21.0 ) (41,602 ) (24.3 ) (Provision for) benefit from income taxes shown in the consolidated statements of operations (177,152 ) 20.9 12,726 (4.1 ) 20,625 12.0 Income tax (expense) benefit based on Netherlands rate reflects the tax (expense) benefit that would have been applicable if all of the Companys income (loss) was derived from its Netherlands operations and there were no permanent book tax differences. A portion of ASMLs results are realized in countries other than the Netherlands where different tax rates are applicable. Different tax rates mainly reflect the adjustment necessary to give effect to the different tax rates applicable in these non-Netherlands jurisdictions. Other credits and non-taxable items reflect the impact on statutory rates of permanent non-deductible and non-taxable items such as non-deductible taxes, non-deductible interest expense, and non-deductible meals and entertainmen

Segment disclosure

Segment disclosure
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Segment disclosure [Abstract]
Segment disclosure	19. Segment disclosure Segment information has been prepared in accordance with ASC 280, Segment Reporting (ASC 280). ASML operates in one reportable segment for the development, manufacturing, marketing and servicing of lithography equipment. In accordance with ASC 280, ASMLs Chief Executive Officer has been identified as the chief operating decision-maker, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Management reporting includes net system sales figures of new and used systems. Net sales for new and used systems were as follows: Year Ended December 31 2007 2008 2009 (in thousands) EUR EUR EUR New systems 3,254,198 2,346,337 993,260 Used systems 97,083 170,425 181,598 Total net system sales 3,351,281 2,516,762 1,174,858 For geographical reporting, net sales are attributed to the geographic location in which the customers facilities are located. Identifiable assets are attributed to the geographic location in which these assets are located. Net sales and identifiable assets (total assets excluding goodwill and other intangible assets) by geographic region were as follows: Year Ended December 31 Net sales Identifiable assets (in thousands) EUR EUR 2007 Japan 270,068 39,666 Korea 1,019,733 21,888 Singapore 204,673 4,989 Taiwan 794,113 53,534 Rest of Asia 283,076 824,524 Europe 344,013 2,602,672 United States 852,509 359,389 Total 3,768,185 3,906,662 2008 Japan 437,202 239,746 Korea 909,941 12,204 Singapore 72,245 5,174 Taiwan 361,808 62,509 Rest of Asia 252,713 374,285 Europe 280,040 2,750,007 United States 639,729 337,324 Total 2,953,678 3,781,249 2009 Japan 41,075 103,399 Korea 377,677 24,931 Singapore 155,825 7,987 Taiwan 440,222 63,502 Rest of Asia 144,004 398,959 Europe 68,652 2,572,665 United States 368,608 406,464 Total 1,596,063 3,577,907 In 2009, sales to the largest customer accounted for EUR349million or 21.9percent of net sales (2008: EUR754million or 25.5percent of net sales; 2007: EUR818million or 21.7p

Board of Management and Supervi

Board of Management and Supervisory Board remuneration
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Board of Management and Supervisory Board remuneration [Abstract]
Board of Management and Supervisory Board remuneration	20. Board of Management and Supervisory Board remuneration The remuneration of the members of the Board of Management is determined by the Supervisory Board on the advice of the Remuneration Committee, in cooperation with the Audit Committee and the Technology Strategy Committee of the Supervisory Board. The 2008 remuneration policy was adopted by the General Meeting of Shareholders on April3, 2008. ASMLs aim with the remuneration policy is to continue to attract, reward and retain qualified industry professionals in an international labor market. The remuneration structure and levels are determined by referencing to the median level of the appropriate top executive pay market practices by benchmarking positions. The total remuneration consists of base salary and benefits, short-term performance cash bonus and short-term performance stock options and long-term performance stock. Base salary, benefits and short-term performance cash bonus The remuneration of the members of the Board of Management was as follows: 2007 2008 2009 Year Ended December 31 EUR EUR EUR Salaries 2,010,000 2,073,000 2,106,333 Bonuses 940,781 988,236 1 1,303,821 2 Pension cost 221,958 249,072 253,683 Other benefits3 245,968 266,625 269,617 Total 3,418,707 3,576,933 3,933,454 1 The bonuses relate for an amount of EUR 629,255 to the first half of 2008 and for an amount of EUR 358,981 for the second half of 2008, which was partly paid in cash, partly in shares. 2 As a response to the financial and economic crisis in 2009, the Company decided to postpone the Board of Managements payment of the 2009 cash bonus (variable pay). Payment will be postponed until the cumulative income from operations after two consecutive quarters, after December31, 2009, is at least EUR 100million. 3 Other benefits include housing costs, company car costs, social security costs, health and disability insurance costs and representation allowances. The 2009 remuneration of the individual members of the Board of Management was as follows: Cash bonus to be paid in Other Base Salary future years1 benefits2 Total EUR EUR EUR EUR E. Meurice 735,000 507,150 141,377 1,383,527 P.T.F.M. Wennink 455,000 251,160 44,886 751,046 M.A. van den Brink 483,000 266,616 44,992 794,608 F.J. van Hout 400,000 220,800 35,199 655,999 F. Schneider-Maunoury3 33,333 58,095 3,163 94,591 1 As a response to the financial and economic crisis in 2009, the Company decided to postpone the Board of Managements payment of th

Selected operating expenses and

Selected operating expenses and additional information
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Selected operating expenses and additional information [Abstract]
Selected operating expenses and additional information	21. Selected operating expenses and additional information Personnel expenses for all payroll employees were: Year ended December31 2007 2008 2009 (in thousands) EUR EUR EUR Wages and salaries 469,214 477,374 436,817 Social security expenses 35,905 37,877 38,533 Pension and retirement expenses 33,478 39,045 39,825 Share-based payments 16,506 13,535 13,465 Total 555,103 567,831 528,640 The average number of payroll employees in FTEs employed during 2007, 2008 and 2009 was 6,191, 6,840 and 6,624 respectively. The total number of payroll personnel employed in FTEs per sector was: Year ended December 31 2007 2008 2009 Research and development 1,831 2,042 2,014 Goodsflow 1,699 1,936 1,749 Industrial engineering 269 Customer support 2,475 2,346 1,893 General 468 488 497 Sales 109 118 126 Total 6,582 6,930 6,548 As of December31, 2007, 2008 and 2009, a total of 1,725, 1,329 and 1,137 temporary employees in FTEs, respectively, were employed in the Companys operations. In 2007, 2008 and 2009, a total of 3,112, 3,510 and 3,601 (on average) payroll employees in FTEs in the Companys operations (excluding temporary employees), respectively, were employed in the Netherlands.

Research and development costs

Research and development costs
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Research and development costs [Abstract]
Research and development costs	22. Research and development costs RD costs include credits for an amount of EUR24.4million, EUR22.2million and EUR28.1million during 2007, 2008 and 2009, respectively. RD credits relate to world-wide (inter)governmental funding for certain strategic development programs.

Interest income and expense

Interest income and expense
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Interest income and expense [Abstract]
Interest income and expense	23. Interest income and expense Interest and similar income of EUR42.8million (2008: EUR72.5million and 2007: EUR78.2million) mainly relates to interest income on deposits, money market funds and on bank accounts, of which EUR27.9million (2008: EUR12.9million and 2007 EUR9.3million) relates to interest on cash pools which is reported on a gross basis in the consolidated statements of operations. From an economic and legal perspective this EUR27.9million (2008: EUR12.9million and 2007: EUR9.3million) interest income nets off against the same amount of interest expense.

Vulnerability due to certain co

Vulnerability due to certain concentrations
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Vulnerability due to certain concentrations [Abstract]
Vulnerability due to certain concentrations	24. Vulnerability due to certain concentrations ASML relies on outside vendors to manufacture the components and subassemblies used in its systems, each of which is obtained from a sole supplier or a limited number of suppliers. ASMLs reliance on a limited group of suppliers involves several risks, including a potential inability to obtain an adequate supply of required components and reduced control over pricing and timely delivery of these subassemblies and components. In particular, from time to time, the number of systems ASML has been able to produce has been limited by the production capacity of Zeiss. Zeiss is currently ASMLs sole external supplier of lenses and other critical optical components and is capable of producing these lenses only in limited numbers and only through the use of its manufacturing and testing facility in Oberkochen and Wetzlar, Germany. During 2009, ASMLs sales were not limited by the deliveries from Zeiss. ASML sells a substantial number of lithography systems to a limited number of customers. See Note19. Business failure of one of ASMLs main customers may result in adverse effects on its business, financial condition and results of operations.

Capital stock

Capital stock
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Capital stock [Abstract]
Capital stock	25. Capital stock Share capital ASMLs authorized share capital consists of ordinary shares and cumulative preference shares. Currently, only ordinary shares are issued. The Companys Board of Management has the power to issue shares if and to the extent the Board of Management has been authorized to do so by the General Meeting of Shareholders (either by means of a resolution or by an amendment to the Companys Articles of Association). However, the Supervisory Board must approve any issuance of shares. Ordinary shares At ASMLs annual General Meeting of Shareholders, held on March26, 2009, the Board of Management was granted the authorization to issue shares and/or rights thereto representing up to a maximum of 5percent of the Companys issued share capital as of the date of authorization, plus an additional 5percent of the Companys issued share capital as of the date of authorization that may be issued in connection with mergers and acquisitions. At ASMLs annual General Meeting of Shareholders to be held on March24, 2010, its shareholders will be asked to authorize the Board of Management (subject to the approval of the Supervisory Board) to issue shares and/or rights thereto through September24, 2011. Holders of ASMLs ordinary shares have a preemptive right of subscription to any issuance of ordinary shares for cash, which right may be limited or excluded. Ordinary shareholders have no pro rata preemptive right of subscription to any ordinary shares issued for consideration other than cash or ordinary shares issued to employees. If authorized for this purpose by the General Meeting of Shareholders (either by means of a resolution or by an amendment to ASMLs Articles of Association), the Board of Management has the power, with the approval of the Supervisory Board, to limit or exclude the preemptive rights of holders of ordinary shares. A designation may be renewed. At ASMLs annual General Meeting of Shareholders, held on March26, 2009, the Board of Management was authorized, subject to the aforementioned approval, to restrict or exclude preemptive rights of holders of ordinary shares. At ASMLs annual General Meeting of Shareholders to be held on March24, 2010, its shareholders will be asked to grant this authority through September24, 2011. At this annual General Meeting of Shareholders, the shareholders will be asked to grant authority to the Board of Management to issue shares and options separately for a period of 18months. The Company may repurchase its issued ordinary shares at any time, subject to compliance with the requirements of Netherlands law and its Articles of Association. Although Netherlands law provides since June11, 2008 that after such repurchases the aggregate nominal value of the ordinary shares held by ASML or a subsidiary must not be more than 50percent of the issued share capital, the Companys current Articles of Association provide that after such repurchases the aggregate nominal value of the ordinary shares held by ASML or a subsidiary must not be more than 10percent of the issued share capital. Any such purchases are subject to the approval of the Supervisory Board and the autho

Purchases of Equity Securities

Purchases of Equity Securities by the Issuer and Affiliated Purchasers
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Purchases of Equity Securities by the Issuer and Affiliated Purchasers [Abstract]
Purchases of Equity Securities by the Issuer and Affiliated Purchasers	26. Purchases of Equity Securities by the Issuer and Affiliated Purchasers The following table provides a summary of shares repurchased by the Company between 2006 and 2009: Total value Total Number Maximum of Shares of Shares Number of Purchased as Purchased as Shares That Part of Publicly Average Part of Publicly May Yet be Announced Total Number Price Paid Announced Purchased Plans or of Shares per Share Plans or Under the Programs (in Program Period purchased (EUR) Programs Programs EUR million) 2006-2007Share program May 17-26, 2006 6,412,920 15.59 6,412,920 19,037,376 100 2006-2007Share program June 7-30, 2006 13,517,078 15.81 19,929,998 5,520,298 314 2006-2007Share program July 3-13, 2006 5,520,298 15.62 25,450,296 400 2006-2007Share program October 12, 2006 14,934,843 18.55 14,934,843 277 2006-2007Share program February 14-23, 2007 8,000,000 19.53 8,000,000 156 Capital repayment program 2007 September - October 2007 55,093,409 18.36 55,093,409 1,012 2007-2008Share program November 14-26, 2007 9,000,000 22.62 9,000,000 5,000,000 204 2007-2008Share program January 17-22, 2008 5,000,000 17.52 14,000,000 292 2006-2007Share program On March23, 2006, the General Meeting of Shareholders authorized the repurchase of up to a maximum of 10percent of the Companys issued shares through September23, 2007. The number of shares bought back in the initial phase of this Repurchase Program was 25,450,296shares, representing 100percent of the announced objective for the initial phase of the Repurchase Program of maximum EUR400million and 5.25percent of outstanding shares. This 2006 Repurchase Program was completed in the third quarter of 2006. Shares repurchased were recorded at cost and classified within shareholders equity. ASML cancelled these repurchased shares in 2007. In the second phase of the Repurchase Program, ASML repurchased 14,934,843 additional shares pursuant to a call option transaction announced on October9, 2006. These repurchased shares represented 10

Subsequent Events

Subsequent Events
	12 Months Ended Dec. 31, 2009 EUR (€) EUR / shares
Subsequent Events [Abstract]
Subsequent Events	27. Subsequent Events Subsequent events have been evaluated by the Company until January29, 2010 which is the issuance date of this Annual Report 2009. There are no subsequent events to report. Veldhoven, the Netherlands January29, 2010 /s/Eric Meurice Eric Meurice, Chief Executive Officer /s/Peter T.F.M. Wennink Peter T.F.M. Wennink, Chief Financial Officer