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ASML has launched its 0.55 High Numerical Aperture Extreme Ultraviolet (High-NA EUV) in an effort to extend Moore's Law. The market had originally expected TSMC to adopt it first, but the company has held back. TSMC Senior Vice President of Global Business Kevin Zhang stated at the North America Technology Symposium that there are currently no plans to introduce High-NA EUV before 2029, mainly because "it's too expensive!" This decision also reflects how TSMC is shifting competition focus from equipment to process integration and cost efficiency.
ASML's next-generation High-NA EUV equipment was unexpectedly first adopted by Intel, while Samsung Electronics has also expanded procurement, yet TSMC(2330.TW) has taken the opposite approach. According to plans made between TSMC and ASML several years ago, High-NA EUV was originally expected to be introduced in the A14 node around 2028. However, after multiple rounds of discussions over the past two years, TSMC Chairman C.C. Wei led senior executives to visit ASML's headquarters in the Netherlands in mid-2024, with both sides even publicly sharing photos of the visit.
Half a year later, ASML's CEO personally visited Taiwan to meet TSMC, but pricing negotiations still failed. Each High-NA EUV system costs as much as EUR350 million (approx. US$410.3 million). Given the high R&D costs, if ASML were to concede on pricing, other customers would likely demand similar discounts.
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The third factor is TSMC's dominance in the foundry industry, including its customer base, capacity, and profitability. As competitive barriers rise, Samsung and Intel have invested heavily in High-NA EUV to surpass competitors through advanced equipment. However, this strategy may instead weigh on their profitability. Without sufficient order volumes to support these investments, the massive capital expenditures for new fabs and equipment depreciation may take a long time to recover.
If yields do not improve, adopting High-NA EUV could further strain the financial positions of Samsung and Intel. TSMC's wait-and-see approach has ultimately become its greatest advantage.
The pressure now shifts back to ASML. Although ASML remains confident about the future, it will lack major High-NA EUV orders from TSMC over the next three to four years, while the Chinese market continues to shrink. For now, orders from logic and memory customers expanding production are still providing support. However, if the memory industry stabilizes and Samsung and Intel also reassess and follow TSMC in delaying High-NA EUV purchases, ASML's operations could face a significant impact.
https://www.digitimes.com/news/a20260427PD204/tsmc-asml-high-na-euv-equipment.html
ASML's next-generation High-NA EUV equipment was unexpectedly first adopted by Intel, while Samsung Electronics has also expanded procurement, yet TSMC(2330.TW) has taken the opposite approach. According to plans made between TSMC and ASML several years ago, High-NA EUV was originally expected to be introduced in the A14 node around 2028. However, after multiple rounds of discussions over the past two years, TSMC Chairman C.C. Wei led senior executives to visit ASML's headquarters in the Netherlands in mid-2024, with both sides even publicly sharing photos of the visit.
Half a year later, ASML's CEO personally visited Taiwan to meet TSMC, but pricing negotiations still failed. Each High-NA EUV system costs as much as EUR350 million (approx. US$410.3 million). Given the high R&D costs, if ASML were to concede on pricing, other customers would likely demand similar discounts.
.....................................................................................
The third factor is TSMC's dominance in the foundry industry, including its customer base, capacity, and profitability. As competitive barriers rise, Samsung and Intel have invested heavily in High-NA EUV to surpass competitors through advanced equipment. However, this strategy may instead weigh on their profitability. Without sufficient order volumes to support these investments, the massive capital expenditures for new fabs and equipment depreciation may take a long time to recover.
If yields do not improve, adopting High-NA EUV could further strain the financial positions of Samsung and Intel. TSMC's wait-and-see approach has ultimately become its greatest advantage.
The pressure now shifts back to ASML. Although ASML remains confident about the future, it will lack major High-NA EUV orders from TSMC over the next three to four years, while the Chinese market continues to shrink. For now, orders from logic and memory customers expanding production are still providing support. However, if the memory industry stabilizes and Samsung and Intel also reassess and follow TSMC in delaying High-NA EUV purchases, ASML's operations could face a significant impact.
https://www.digitimes.com/news/a20260427PD204/tsmc-asml-high-na-euv-equipment.html