ASML Says AI Chip Demand Is Stretching Into 2030. It Already Expects Supply Shortages Through 2028.

ASML said Wednesday that some customers are already looking to place orders for advanced chipmaking equipment for 2029 and 2030 as demand tied to artificial intelligence continues to stretch the company's manufacturing capacity.

The Dutch semiconductor equipment maker expects its currently planned production capacity for 2027 and 2028 to fall short of customer requirements, even after previously announcing plans to expand output by as much as 30% in each of those years.

The outlook accompanied record third-quarter net sales of €11.66 billion and net income of €4.96 billion, according to ASML's latest financial results.

ASML raised the lower end of its full-year revenue forecast to €44 billion, from €43 billion previously, while maintaining the upper end at €45 billion. The company expects fourth-quarter sales of €14.2 billion to €15.2 billion.

Chief Executive Officer Christophe Fouquet said customers were increasing their near- and medium-term equipment demand forecasts, driven primarily by expectations about the scale and duration of AI-related investments.

Some customers have expressed interest in orders extending into 2029 and 2030, although the company did not identify them or disclose the value of those potential purchases.

ASML supplies lithography machines used to manufacture advanced semiconductors, including processors that power AI systems. Its extreme ultraviolet, or EUV, technology enables chipmakers to produce the intricate circuit patterns required for increasingly sophisticated chips.

The company's customers include Taiwan Semiconductor Manufacturing Co., Samsung Electronics and Intel, alongside memory chipmakers such as SK Hynix and Micron.

TSMC manufactures advanced processors for companies including Nvidia, while memory manufacturers are expanding production of chips used alongside AI processors in data centers.

ASML had outlined plans in July to increase its 2026 production capacity for certain EUV and deep ultraviolet lithography systems by 30% in 2027, while examining another increase for 2028.

In its second-quarter financial results, the company said it was planning around annual capacity of 65 low-NA EUV machines and 130 deep ultraviolet immersion systems in 2026.

However, management said Wednesday that the expansion plans would not fully satisfy expected demand, prompting ASML to investigate additional capacity for 2028 beyond the previously discussed increase.

The company is also expanding upgrades that allow customers to process more silicon wafers using existing equipment, reducing the need to rely entirely on deliveries of new machines.

Demand for those upgrades contributed to stronger revenue from servicing and improving installed equipment during the third quarter.

Installed Base Management sales reached €3.29 billion, compared with €2.76 billion in the previous quarter. ASML said the higher-than-expected contribution helped lift its gross margin to 57.5%, from 54% in the second quarter.

The company sold 113 new lithography systems during the July–September period, up from 86 in the preceding quarter, while quarterly net income increased from €2.92 billion to €4.96 billion.

ASML began construction of a new industrial campus in Eindhoven, Netherlands, in September to support its longer-term manufacturing plans. The first phase is scheduled for completion in 2029.

According to the company's September 8 announcement, the development could eventually span approximately 350,000 square meters and accommodate up to 20,000 workplaces. Its first phase will house manufacturing, logistics and support operations.

The company is also working with major chipmakers to introduce more advanced lithography technology. In September, ASML and Samsung Electronics announced an expanded partnership involving High-NA EUV systems for future semiconductor production, including advanced memory chips.