Price of the system includes installation and standard warranty. Standard Warranty coverage is described in the chapter Technical specifications of this quotation. The price quoted assumes the timely return by Buyer of ASML’s transportation containers and other materials used in transporting the system. ASML will charge Buyer for the cost of such containers and materials if they are not returned to ASML in a timely manner. Any part removed from the system during installation and the warranty period or as part of an extended warranty service contract for replacement will be retained by ASML.
For fiscal 2017, 2016 and 2015, the provision for warranty expense related to instruments was $2.2 million, $1.2 million and $2.4 million, respectively. During fiscal 2016, we recorded an adjustment to pre-existing warranties of $0.2 million, which reduced our warranty reserves and our cost of revenues, based on our historical experience and our projected performance rate of instruments. The change in the provision for warranty expense related to instruments during fiscal 2017, as compared to fiscal 2016, was primarily attributable to an increase in the number of instruments under standard warranty. The change in the provision for warranty expense related to instruments during fiscal 2016, as compared to fiscal 2015, was primarily attributable to a decrease in the number of instruments under standard warranty. The increase in the provision for warranty expense related to instruments during fiscal 2015, as compared to fiscal 2014 was primarily attributable to an increase in the number of instruments under standard warranty.
The Company generally offers a one year warranty for all of its systems, the terms and conditions of which vary depending upon the product sold. For all systems sold, the Company accrues a liability for the estimated cost of standard warranty at the time of system shipment and defers the portion of systems revenue attributable to the fair value of non-standard warranty. Costs for non-standard warranty are expensed as incurred. Factors that affect the Companys warranty liability include the number of installed units, historical and anticipated product failure rates, material usage and service labor costs. The Company periodically assesses the adequacy of its recorded liability and adjusts the amount as necessary.
1. Computex alone is responsible to its customers for providing the solution desired by its customers, be it the acquisition of the product or services and the subsequent support and maintenance. Computex is solely responsible for the business relationship with its customers. Computexs sales force is intimately involved with the customer during and subsequent to the sales process, and Computexs customers view Computex as their single point of contact for all of their product and service needs, with the exception of those instances in which Computexs customers make a claim under the manufacturers standard warranty. With the exception of the manufacturers standard warranty, Computexs vendors have no interaction or contractual relationship with Computexs customers. Computex believes that their strong and exclusive relationship with their customers supports the conclusion that Computex is the primary obligor.
The products shall be covered by the applicable Entegris standard warranty. NO OTHER EXPRESS OR IMPLIED WARRANTY IS MADE WITH RESPECT TO THE PRODUCTS. ENTEGRIS EXPRESSLY EXCLUDES THE IMPLIED WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE. Any model or sample furnished to the Buyer is merely illustrative of the general type and quality of goods and does not represent that the products will conform to the model or sample. Buyer’s remedies under Entegris’ warranty shall be limited to repair or replacement of the product or component thereof which failed to conform to Entegris’ warranty.
We generally offer a one year warranty for all of our systems, the terms and conditions of which vary depending upon the product sold. For all systems sold, we accrue a liability for the estimated cost of standard warranty at the time of system shipment and defer the portion of systems revenue attributable to the fair value of non-standard warranty. Costs for non-standard warranty are expensed as incurred. Factors that affect our warranty liability include the number of installed units, historical and anticipated product failure rates, material usage and service labor costs. We periodically assess the adequacy of our recorded liability and adjust the amount as necessary.