ASML's Strategic Leap: Powering the Next Generation of Chip Manufacturing

ASML boosts EUV light source power to 1,000W, enabling faster chipmaking. The tech leap strengthens its market lead amid competition and supports strong financial outlook.

ASML Holding NV, the semiconductor industry's critical equipment supplier, has achieved a significant breakthrough in its core technology. The company has successfully boosted the power output of its extreme ultraviolet (EUV) light source, a development that promises to accelerate global chip production capabilities.

A Production-Ready Power Surge

According to a Reuters report, ASML's research teams have increased the power of its EUV light source to 1,000 watts, a substantial jump from the current standard of approximately 600 watts. Crucially, this advancement is not merely a laboratory demonstration. The company has reportedly achieved this milestone under conditions that mirror the operational environment of its customer base—the world's leading chip fabricators.

This enhancement is fundamentally about speed. A more powerful EUV source reduces the exposure time required to pattern silicon wafers. For chipmakers, this translates directly into higher throughput per machine, enabling the production of more chips per hour without the need for extensive and costly factory redesigns.

ASML has outlined a target for this decade: it aims for each EUV machine to process around 330 wafers per hour by 2030, compared to roughly 220 today. The reported technical improvements include doubling the frequency of tin droplet generation to about 100,000 per second and refining the associated laser process.

Fortifying a Market Lead Amid Growing Competition

The timing of this announcement appears strategic. ASML holds a de facto monopoly on commercial EUV lithography systems, a position that has placed the company and its technology at the center of geopolitical attention. Export restrictions to China have spurred national programs there to develop domestic alternatives.

Simultaneously, potential challengers are emerging elsewhere. Reuters notes that U.S.-based startups like Substrate and xLight have secured significant funding, with xLight also reportedly receiving state support. ASML's response is rooted in engineering, not rhetoric. The company has indicated it sees a "relatively clear path" to achieving 1,500 watts and, in principle, no fundamental barrier to reaching 2,000 watts.

Operational Strength and Shareholder Returns

Beyond the technical frontier, ASML's operational and financial foundations remain robust. The company is undergoing a restructuring initiative, noted by Simply Wall St, which involves streamlining processes and reducing roles to improve cost efficiency and eliminate overlaps from past acquisitions.

On capital management, ASML provided an update today regarding its ongoing share buyback program. Announced on January 28, 2026, alongside its Q4 results, the program authorizes repurchases of up to €12 billion through 2028.

Strong financial performance supports these moves. For 2025, ASML reported revenue of €32.7 billion and net income of €9.6 billion. Management's outlook for 2026 projects revenue between €34 billion and €39 billion, with a gross margin forecast of 51% to 53%. Furthermore, a record order backlog exceeding €38 billion already surpasses the lower end of the 2026 revenue guidance.

The company's shares reached a new 52-week high of €1,265.00 in today's trading.

The critical focus now shifts to execution. The central question for the industry is whether ASML can successfully scale this 1,000-watt architecture for series production and customer deployment. Achieving this would transform a laboratory breakthrough into a tangible productivity lever for the global semiconductor industry through the end of the decade.