"These aren't commodity tools. Each EUV system costs north of $150 million, and you can't manufacture cutting-edge chips without them. TSMC is ASML's largest customer, and the foundry's push into 2nm production (already started) and future 1.6nm nodes requires even more EUV capacity. The math is straightforward: TSMC's five new Arizona fabs plus capacity expansion in Taiwan means dozens of EUV systems. At $150-200 million per machine, we're talking $3-5 billion flowing to ASML from this capex cycle alone."
"Applied Materials doesn't have ASML's monopoly, but it has something potentially more valuable: multiple revenue streams from every fab TSMC builds. Deposition equipment, etching systems, inspection tools. AMAT supplies the full stack. The company just posted its 12th consecutive quarter of earnings beats, with Q4 2025 EPS of $2.17 (up 9% year-over-year despite broader semiconductor equipment headwinds). That consistency matters when you're betting on a multi-year capex cycle. TSMC's $56 billion doesn't hit all at once. It flows over 3-4 years as fabs come online."
TSMC committed $56 billion to AI chip manufacturing capacity, driving heavy equipment demand as fabs are built. Much of that spending flows to semiconductor-equipment makers rather than factory operating costs. ASML holds a monopoly on extreme ultraviolet (EUV) lithography systems, with each system costing north of $150 million and mission-critical to cutting-edge nodes. TSMC's new Arizona fabs and Taiwan expansions require dozens of EUV machines, implying roughly $3-5 billion of ASML sales from this cycle. Applied Materials supplies deposition, etch, and inspection equipment across fabs and posted a twelfth consecutive quarter of earnings beats. TSMC's capex will flow over multiple years as fabs come online.
Read at 24/7 Wall St.
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