Semiconductors: TSMC is Not Buying ASML’s New Machines

TSMC has decided not to buy ASML's new lithography machines for use in its semiconductor manufacturing process.

TSMC’s Co-Chief Operating Officer Kevin Zhang said its new A13 node does not require the High-NA EUV machines, according to Bloomberg.

The technology is used to print the most intricate layers on semiconductor wafers for chips that enable AI and augmented reality.

Shares in ASML dropped dramatically after the announcement.​​​​​​​

What has TSMC decided not to buy?

ASML's lithography machines are used by companies like Samsung Electronics and TSMC in semiconductor manufacturing. 

According to ASML, EUV lithography systems are used to print the most intricate layers on a chip, with the rest of the layers printed using various DUV (deep-ultraviolet) systems.

Chips made with EUV lithography enable smart technology, augmented reality, artificial intelligence and other advanced technologies. 

TSMC's A13 Node

TSMC recently announced its A13 node, which it says is a direct shrinking of its A14 node announced in 2025. TSMC says the A13 enables even more compact and efficient designs to address “insatiable customer demand” in computational requirements for next-generation artificial intelligence, high performance computing and mobile applications.

In a press release, TSMC Chairman and CEO Dr. CC Wei, said of the technology: “At TSMC, we understand our customers are always looking ahead to their next innovation and they come to us for a reliable stream of new silicon technologies, like A13, meticulously engineered to be ready for high-volume production right when their visionary new designs demand them.​​​​​​​

“TSMC's advanced process technologies lead the industry in density, performance and power efficiency and we continually strive to make them even better for our customers' future products, ensuring customers' success as their most reliable technological partner.”

Bloomberg says that TSMC may adopt the new lithography technology in its manufacturing process in 2029.

Implications in semiconductor manufacturing

ASML announced plans to cut jobs in January in an effort to slash bureaucracy. The company said in a statement that “as a result of these proposed changes, some roles, mainly at the leadership level, may no longer be required".

Business Insider reported that the company is planning a six-week summer recruitment freeze, following the earlier announcement of plans to cut 1,700 jobs. 

Shares of ASML plummeted as a result of the announcement by TSMC. The Wall Street Journal reported that prices slid 3%, US$16.76bn. At time of writing, ASML's market cap stands at US$478.96bn, remaining Europe's most valuable company.

TSMC has a market cap of roughly US$1.8tn, which makes it one of the most valuable companies in the world. 

According to McKinsey the semiconductor industry's highly interdependent global value chain is now under pressure amid rising geopolitical tensions, new tariff policies, material and component shortages and potential restrictions on exports.

​​​​​​​It is possible that other semiconductor manufacturers may double down on EUV semiconductor manufacturing in an attempt to gain a competitive edge over TSMC. 

The question of why the business creating the world's most advanced semiconductors for AI has called the most advanced lithography technology too expensive still stands.