Nvidia has achieved the status of the world’s most valuable company, largely owing to its innovative chips that are driving the AI revolution. However, its remarkable success is intricately linked to ASML.
The Dutch semiconductor equipment manufacturer, one of Europe’s most esteemed companies, specializes in producing lithography machines essential for engraving intricate patterns on silicon wafers.
ASML dominates the industry as the sole manufacturer of extreme ultraviolet (EUV) lithography machines necessary for producing cutting-edge semiconductors, boasting a 90% share of the broader lithography market.
Bank of America analyst Didier Scemama anticipates that ASML is on the verge of establishing a monopoly in next-generation EUV lithography. “ASML has industrialised next-gen EUV (Extreme Ultraviolet) lithography technology, which we believe will support many disruptive trends of this decade,” he stated in a recent note.
This assessment followed ASML’s earnings report, which disclosed that bookings exceeded analysts’ expectations by more than double for the fourth quarter of 2025.
ASML’s share price
Catching up to ASML is virtually impossible
Javier Correonero, an equity analyst at Morningstar, explained to CNBC that lithography serves as “the building block of any chip,” emphasizing that ASML machines are key to the production of 99% of semiconductors.
However, it is the EUVs that hold particular significance for the development of AI technologies.
ASML manufactures two types of EUVs: low numerical aperture, which are utilized to produce the current generation of AI chips like Nvidia’s Blackwell, and high numerical aperture, which are employed in research and development for next-generation semiconductors.
ASML’s EXE:5000 in the High NA Lab in Veldhoven.
Both types of machines utilize powerful lasers directed at molten tin droplets in a vacuum, which create plasma that emits EUV light. This light is then manipulated with ultra-precise mirrors and directed off a mask containing the pattern for each layer of the chip, shrinking and projecting it onto a silicon wafer.
These systems are purchased by chip foundries, such as the Taiwanese firm TSMC, which are contracted by chip designers like Nvidia.
Correoner noted that competitors like Japan’s Nikon and Canon, which sell some lithography machines for less advanced process nodes, are “far-away competitors.” He added, “They are large conglomerates that have invested only a fraction of what ASML has over three decades. At this stage, catching up is virtually impossible.”
Looking ahead
EUVs constitute the majority of ASML’s booking value, contributing 7.4 billion euros ($8.8 billion) to a total of 13.2 billion euros in net bookings for the fourth quarter of 2025. Throughout 2025, the company sold 48 EUV systems, generating 11.6 billion euros in revenue.
While ASML does not publicly disclose the prices of its machines, analysts have estimated that the cost for its most advanced high NA EUV ranges between 320 million and 400 million euros. The low NA EUV, on the other hand, is priced around 220 million euros, according to Correonero.
Companies such as TSMC, Intel, and Samsung are currently testing the high NA EUV in lab settings.
“Once customers have familiarized themselves with the tool, it will gradually be introduced into high-volume manufacturing. High NA is expected to enter full-scale production by 2027-2028, with Intel as the first adopter,” Correonero mentioned.
ASML’s stock price increased by 36% last year and has surged another 32% since the beginning of this year. Earlier this month, it reached the significant milestone of becoming just the third European company to achieve a valuation of half a trillion dollars, a level it continues to maintain.
Analysts predict that the stock will continue to rise, as advanced chips are essential for the ongoing AI expansion. ASML expects that net sales for 2026 will reach between 34 billion and 39 billion euros, surpassing the 32.7 billion euros recorded in 2025.
