Business Breakdowns · Colossus | Investing & Business Podcasts

ASML: Competing with Moore’s Law

·53 min·3 clips

ASML began as Philips’s problem child, with no revenue, no offices, and wooden barracks in Eindhoven.

1. Business Breakdowns revisits ASML and extreme ultraviolet lithography with Matt Russell and Tom Walsh. 2. Matt Russell hosts the episode, and Tom Walsh is a portfolio manager at Baillie Gifford who explains ASML’s technology and business model. 3. The episode asks how a Philips spinout with no revenue became the company behind the most advanced chipmaking tools. 4. Walsh says ASML started in 1984 as the “problem child of Philips” with no offices and no commercially credible product. 5. He describes the first offices as wooden barracks in Eindhoven and says many transferred workers thought the business would die. 6. Walsh credits two early technologies, a group of tenacious engineers, and a transition in the lithography industry for ASML’s survival. 7. ASML moved from number 10 of 10 lithography players to one of three leaders by the mid-1990s, alongside Nikon and Canon. 8. Walsh says ASML overtook Nikon as industry number one in 2002 after nearly 20 years of work. 9. He explains that ASML’s EUV tools entered high-volume production in 2019 after years of delay. 10. Walsh says ASML now has essentially 100% of the world’s most advanced lithography equipment and 90% plus of the next generation. 11. Photolithography works by coating silicon with photoresist and projecting light through a mask to pattern circuits. 12. Walsh compares the process to a cinema projector, except the image is shrunk rather than enlarged. 13. He says Moore’s law depends on photolithography because stalled lithography stalls transistor shrinkage. 14. Walsh notes that leading-edge chips are now measured in single-digit nanometers, with the leading-edge node at five nanometers. 15. He explains that EUV became necessary because deep ultraviolet light at 193 nanometers could not keep shrinking patterns cleanly enough. 16. ASML’s EUV push involved U.S. Department of Energy and DARPA funding, then 1.4 billion euros of support from Intel, Samsung, and TSMC. 17. Walsh says ASML has spent more than 10 billion euros on EUV R&D and had to buy the light-source provider Cymer in San Diego. 18. He describes EUV machines as double-decker-bus-sized systems shipped in three jumbo jets and assembled by ASML’s integrator model. 19. Walsh says the conversation suits investors and operators who want semiconductor history, machine detail, and a case study in long-cycle execution. 20. He suggests anyone uninterested in semiconductor process details or capital-intensive industrial competition may skip it.

As heard by us

A grounded look at ASML, EUV, and why the company still matters in AI infrastructure.

Business Breakdowns frames ASML around extreme ultraviolet lithography and the sheer difficulty of building at that level. Tom Walsh does the practical work of making the technology readable for investors, which keeps the business case in focus instead of letting the engineering…

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You want the bottleneck behind ASML and EUV explained cleanly.

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