ASML Warns of Equipment Shortages Through 2028 as AI Demand Surges
As demand for artificial intelligence (AI) chips surges, competition among global semiconductor manufacturers to secure production equipment is expected to extend well into the next decade. Dutch lithography equipment giant ASML has warned that its currently planned production capacity will be insuf
As artificial intelligence (AI) chip demand surges, ASML, a leading Dutch lithography equipment company, warns of insufficient production capacity to meet customer needs through 2028. The company reported record earnings of 11.66 billion euros in revenue and 4.96 billion euros in net income for Q3, with memory chip sales surging 98% year-over-year.
CEO Christophe Fouquet revealed customer interest in ordering equipment for 2029 and 2030, while acknowledging the shortfall in planned production capacity for 2027 and 2028. Competition for equipment extends beyond securing volumes, with customers specifying delivery schedules and factory locations. South Korea has become ASML's largest market for new equipment sales, driven by semiconductor giants Samsung Electronics and SK Hynix expanding capacity for high-bandwidth memory and next-generation DRAM.
Meanwhile, Elon Musk's Terafab project may further strain demand for advanced semiconductor manufacturing equipment, potentially increasing pressure on established chipmakers. ASML has announced price hikes for equipment, set to impact financial results from 2027 onwards. Despite efforts to shorten lead times and expand production in the Netherlands, industry experts believe these measures may still be insufficient to match the rapid growth in AI-driven demand.
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