ASML struggles with chip tool demand

RAISED FORECAST: With customers ‘asking us every single day to get more tools,’ ASML said that the company is working on different ways to increase capacity for 2028

ASML Holding NV yesterday warned that soaring artificial intelligence (AI) spending meant that it faces a potential supply shortfall with its chipmaking machines in the next two years, even as it boosted its own sales forecast for this year.

“We are investigating ways to increase capacity for 2028 beyond the 30 percent increase we previously communicated,” ASML chief executive officer Christophe Fouquet said in a statement on the Dutch company’s results.

“Customers are asking us every single day to get more tools,” he said in a separate video.

The ASML booth is pictured at the Semicon India expo in New Delhi on Sept. 17.

Photo: Bloomberg

Robust customer demand prompted ASML to slightly raise its full-year sales forecast, predicting annual sales of between 44 billion euros and 45 billion euros (US$49 billion and US$50 billion). The low end of the range was previously 43 billion euros.

ASML, Europe’s biggest tech firm by market value, said in July that it plans to boost capacity by 30 percent next year for its second-most advanced tool, the low numerical-aperture extreme ultraviolet (EUV) lithography machine, which would take its annual shipment target to about 85 units.

The chip-gear maker’s customers have boosted their equipment demand forecasts based on the “size and duration of AI-related investments,” Fouquet said.

Some customers “are expressing an interest in placing orders with us for 2029 and even 2030,” he said.

ASML is the only company that makes the cutting-edge lithography machines used to produce semiconductors for the data centers powering the AI boom. Its outlook offers an indication of investment plans by chipmakers such as Taiwan Semiconductor Manufacturing Co (台積電), Samsung Electronics Co and Intel Corp as spending on AI infrastructure surges.

The company is working to ship tools faster to customers by reducing the cycle time, or the period between starting production in its clean rooms and shipping a completed machine. It began construction on its second industrial campus in the Netherlands, the first phase of which is set to be completed in 2029.

Net sales in the July-to-September quarter rose to 11.66 billion euros, ASML said. That compares with the average analyst estimate of 11.7 billion euros, data compiled by Bloomberg showed.

Net profit came in at 5 billion euros in the quarter, compared with 2.1 billion euros in the same period last year, ASML said.

The company sold 17 EUV machines in the quarter while revenue from the service and upgrades of machines already installed at customers’ sites increased 19 percent as chipmakers looked to be more productive.

“Against the backdrop of an overall 36 percent increase of 2026 in comparison to 2025, you see that that is largely driven by EUV,” ASML chief financial officer Roger Dassen said in a video accompanying the results. “So the EUV business grows over 45 percent this year.”

South Korea remained ASML’s largest market for new system tools in the third quarter, followed by Taiwan and China. China is expected to account for about 20 percent of ASML’s total revenue this year.