The AI Boom’s Unsung Hero: ASML’s Dominance and the Future of Chipmaking
A single company is quietly powering the artificial intelligence revolution, and it’s not Nvidia. It’s ASML, the Dutch firm that holds a virtual monopoly on the most advanced chipmaking technology. The company just reported a record €32.7 billion ($39 billion USD) in revenue for 2025, a 15% jump, and the trajectory points even higher. This isn’t just about bigger numbers; it’s a fundamental shift in the tech landscape, where access to cutting-edge lithography is becoming the defining factor in global competitiveness.
The EUV Revolution: From Niche to Necessity
For years, ASML was known for its deep ultraviolet (DUV) lithography systems. But the real game-changer has been Extreme Ultraviolet (EUV) lithography. EUV allows for the creation of far more intricate chip designs – the kind needed for advanced AI accelerators, high-performance computing, and next-generation mobile devices. In 2025, EUV tools accounted for 48% of ASML’s system revenue, a significant leap from 38% the previous year, and 65% of their backlog. This demonstrates a clear trend: the industry is moving decisively towards EUV, and ASML is the only company that can deliver.
Intel’s purchase of the first High-NA EUV machine, the Twinscan EXE:5200B, underscores this point. This next-generation technology, with its 0.55 numerical aperture optics, is crucial for manufacturing chips using 1.4nm-class process technologies (Intel’s 14A node). SK Hynix also has a High-NA EUV system installed, and ASML has supplied eight of these advanced machines to partners so far. The investment signals a commitment to staying at the forefront of chip manufacturing.
China’s Challenge and the Grey Market
While demand is soaring overall, ASML’s sales to China have decreased due to U.S. and Dutch export restrictions. However, the story isn’t as simple as a complete shutdown. Chinese chipmakers continue to purchase older DUV systems, representing 33% of ASML’s unit sales in 2025. Reports suggest some of these systems are being upgraded through unofficial channels – the so-called “grey market” – highlighting China’s determination to build its domestic semiconductor industry, despite the obstacles. This situation presents a complex geopolitical challenge and raises questions about the long-term effectiveness of export controls.
Geopolitical Implications and Supply Chain Resilience
The concentration of EUV technology in ASML’s hands has significant geopolitical implications. Countries are increasingly recognizing the strategic importance of semiconductor manufacturing and are investing heavily in domestic capabilities. The U.S., for example, is offering substantial incentives to attract chipmakers and build a more resilient supply chain. The CHIPS and Science Act is a prime example of this effort, aiming to reduce reliance on foreign sources for critical technologies. This push for self-sufficiency will likely drive further demand for ASML’s equipment, even as geopolitical tensions remain.
Beyond Logic: EUV’s Expanding Role in Memory
Historically, EUV adoption was primarily driven by logic chip manufacturers building processors for AI, smartphones, and PCs. However, the landscape is changing. Memory chipmakers, particularly those producing DRAM and HBM (High Bandwidth Memory), are increasingly adopting EUV technology. As DRAM vendors ramp up production of 1b and 1c nodes, they’re intensifying their procurement of EUV scanners. This is because EUV allows for more efficient and cost-effective manufacturing of these high-demand memory types. Fouquet, ASML’s CEO, noted that memory makers operate large fleets to maximize cost efficiency, meaning increased EUV adoption will significantly boost demand.
Looking Ahead: A Revenue Trajectory to €60 Billion
ASML anticipates continued growth, projecting revenue between €34 billion and €39 billion for 2026. More impressively, the company forecasts potential revenue reaching €44 billion to €60 billion by 2030. This optimistic outlook is fueled by the increasing number of EUV layers required for future process technologies. The demand for AI infrastructure, coupled with advancements in memory technology, is creating a powerful tailwind for ASML. The company is investing heavily in expanding its footprint and workforce to meet this growing demand.
The future of chipmaking is inextricably linked to ASML’s innovation. As AI continues to permeate every aspect of our lives, the demand for increasingly powerful and efficient chips will only intensify. And as long as ASML remains the sole provider of the tools needed to create those chips, it will continue to be a pivotal player in the global technology landscape. What impact will the increasing demand for AI have on ASML’s future innovations? Share your thoughts in the comments below!
