A New Challenge Emerges for ASML’s Semiconductor Dominance

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The near-total control ASML holds over the market for advanced lithography systems is facing a potential long-term threat, according to a recent analysis from investment bank Jefferies. The catalyst is significant U.S. government funding awarded to an ambitious domestic startup, signaling a strategic push to reduce reliance on European chipmaking technology.

A weekend report from Jefferies analyst Janardan Menon has brought attention to U.S.-based startup xLight. The company, which recently secured $150 million in U.S. state aid, is developing free-electron laser technology. This approach could potentially offer performance four times greater than ASML’s current extreme ultraviolet (EUV) lithography systems.