asml's euv dominance: the linchpin of ai chipmaking

2025-06-25 asml

Veldhoven, Wednesday, 25 June 2025.
asml holding stands as the single most critical player in enabling next-generation ai chips. its exclusive euv lithography technology creates a bottleneck, but also opportunity. nvidia and tsmc rely on asml’s advancements for cutting-edge manufacturing. investors should watch asml’s technological strides and order books. these factors directly influence the production of ai semiconductors. the company’s monopoly in this space makes it a compelling, albeit risky, investment.

EUV lithography market growth

The global EUV lithography market was valued at $11.9 billion in 2024 [3]. It is projected to grow from $12.16 billion in 2025 to $24.23 billion by 2032 [3]. This represents a significant expansion, driven by the increasing demand for advanced semiconductor nodes [3]. These advanced nodes are essential for producing smaller, more powerful chips required for AI and other cutting-edge technologies [3]. ASML’s role in this market is pivotal, as its EUV technology is essential for manufacturing these advanced chips [1].

Intel’s high-na euv adoption

Intel has integrated ASML’s High-NA EUV lithography machines into its factories [2]. Intel is using these machines for the production of 30,000 wafers per quarter [2][6]. These machines are currently in production [2]. Intel plans to use High-NA EUV for its Intel 18A (1.8nm) manufacturing technology, with mass production expected later this year [2][6]. This move underscores the importance of ASML’s technology in Intel’s roadmap for advanced chip manufacturing [2].

tsmc’s approach to advanced nodes

While Intel is aggressively adopting High-NA EUV, TSMC is taking a different approach [2]. TSMC’s A16 (1.6nm) and A14 (1.4nm) processes will not use High-NA EUV lithography machines [2][6]. TSMC has found alternative methods to produce chips at the A14 node, achieving a resolution of 8nm compared to the standard EUV system’s 13.5nm [2]. This suggests that while ASML’s technology is crucial, innovative manufacturing techniques can provide alternative pathways for advanced chip production [2].

samsung’s euv strategy

Samsung has also entered the High-NA EUV arena, introducing its first ASML TWINSCAN EXE:5000 in Hwaseong, South Korea, in March 2025 [2][6]. Samsung is evaluating the use of High-NA EUV in its 1.4nm process, with a mass production target set for 2027 [2][6]. Unlike Intel, Samsung and SK Hynix have delayed the use of High-NA EUV in DRAM production due to high costs and changes in DRAM architecture [2]. This indicates a more cautious and selective adoption strategy for EUV technology in memory chip manufacturing [2].

market dynamics and asml’s dominance

ASML’s technological moat is reinforced by unmatched vertical integration, exclusive partnerships, and a high-margin, recurring installed base business [1]. High-NA EUV tools drive pricing power, margin expansion, and customer lock-in, supporting robust long-term revenue and free cash flow growth [1]. Despite these strengths, an anonymous Intel director suggested that the future of chip design would reduce reliance on advanced lithography, emphasizing etching technology [2][6]. This perspective suggests potential shifts in the semiconductor landscape that could impact ASML’s long-term dominance [2].

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EUV Lithography AI Supply Chain