ASML's EUV Equipment Exports Being Delayed
The Netherlands’ ASML is the world’s sole producer of extreme ultraviolet (EUV) exposure equipment used for semiconductor production. Yet the company is having difficulty exporting its equipment due to COVID-19, negatively affecting major global semiconductor producers including Samsung Electronics and TSMC. Some experts say that bigger damage will be done to Samsung than TSMC.
A delay in ASML equipment delivery is forcing the two foundry giants to change their development and production roadmaps. Taiwanese TSMC is considering postponing the test production of 3-nm semiconductors from June to October. Samsung Electronics was scheduled to begin mass production of 5-nm semiconductors in 2020, but a delay appears inevitable.
This situation is more painful to Samsung Electronics than TSMC. TSMC plans to produce 5-nm semiconductors for Apple, Qualcomm, Huawei, and AMD within the second quarter of 2020. The company is a step ahead of Samsung, which is yet to come up with a detailed schedule for mass production of 5-nm products.
Last year, Taiwanese companies led by TSMC swept ASML’s EUV equipment, accounting for 51 percent of the Dutch company’s total sales. Korean companies took up 16 percent of ASML’s sales. As Samsung’s acquisition of EUV equipment last year included that for DRAM production, its acquisition of EUV equipment for the foundry business is not enough compared to TSMC.
Samsung Electronics is confident of taking the top spot in the system semiconductor market in 2030, but the problem is that its gap with TSMC in the foundry market is widening. TSMC's foundry share in the first quarter of in 2020 increased by 1.4 percentage points from the previous quarter to 54.1 percent, while Samsung Electronics recorded a decrease of 1.9 percentage points to 15.9 percent, TrendForce said.
The EUV-based foundry market is a two-runner race between Samsung Electronics and TSMC. If Samsung Electronics fails to go ahead in technology, the market share gap will inevitably widen.
Samsung Electronics was the first company to introduce EUV in the foundry process, but it has failed to secure a technological edge in micro-fabrication process. If Samsung Electronics lags behind in the micro-fabrication competition with TSMC, it will be virtually impossible to win orders for semiconductors from IT industry leaders such as Apple and Qualcomm.
Kim Ki-nam, vice chairman of Samsung Electronics, said in its general shareholders' meeting in March, “There is a gap between Samsung Electronics and TSMC in the foundry business, but we will develop our foundry business by securing leadership in new processes.” Yet the company cannot take leadership in new processes if its introduction of EUV equipment is delayed.