Meet ASML, the World's Dominant Supplier of Semiconductor Equipment

When you think “tech hub,” the predictable places come to mind first: San Francisco, Silicon Valley, Shenzhen, Seattle, Taiwan...and Miami, if you’re on Twitter too much. We have a dark horse to add to the list: Veldhoven, a 45,000-person town and suburb of Eindhoven, the Netherlands’ fifth-largest city.

What’s there? The headquarters of ASML, the world's largest photolithography equipment supplier to the semiconductor industry. In simpler terms, ASML makes and sells advanced chipmaking machines to manufacturers. Its lithography machines enable new hardware like the Apple M1 and Qualcomm’s 5G chipsets.

If semis are the new gold, these machines are the new pickaxes

ASML’s forte is extreme ultraviolet (EUV) machines, which use light at a 13.5 nanometer wavelength to etch billions of tiny structures onto slices of silicon. The Dutch company has a 62% market share in lithography machines and an EUV monopoly. Business...is...booming:

• ASML did nearly $17 billion in 2020 net sales, up from $14 billion the year before. As of this morning, the Dutch company's market cap was roughly $226 billion.

ASML’s big customers—TSMC, Samsung, and Intel—don’t place purchase orders and then expect two-day shipping. Delivery takes roughly two years. ASML’s state-of-the-art EUV machines have 100,000+ parts, cost ~$120 million, and ship in 40 freight containers.

Talking shop with ASML

We caught up with Tony Yen, ASML’s VP of tech development, who is based in Silicon Valley. We touch on the standard cookie-cutter topics we discuss with everyone—pushing the boundaries of physics, Dutch culture, and whether Moore’s Law is dying.

We’ll let you read the full convo for more, but in the meantime, here are a few highlights:

• “We started [thinking about EUV machines] around the year 2000.”
• “The most bleeding-edge technology in high-volume manufacturing is the 5-nanometer node, being manufactured at TSMC and Samsung.”
• “We think of ourselves as the linchpin [in the tech world].”

Read the full Q&A here.