ASML'S BET ON EUV MADE IT CHIP INDUSTRY CHOKEPOINT

ASML's dominance in EUV lithography stems from a high-risk investment in the technology years before it proved viable. While competitors abandoned the approach, ASML persisted, eventually becoming the sole viable supplier of EUV systems needed to manufacture the most advanced semiconductors. The company's exclusive control over this critical bottleneck grew through strategic collaboration with Taiwan Semiconductor Manufacturing Company (TSMC), which relied on ASML machines to maintain its foundry leadership. U.S. government involvement further strengthened ASML's position, with Washington recognizing the geopolitical importance of securing access to advanced chipmaking capabilities. This concentration creates systemic risk. Any disruption to ASML's operations or supply chains cascades through the entire semiconductor industry, affecting producers of chips for everything from smartphones to data centers. The company's leverage extends to geopolitical negotiations, making it a focal point in ongoing U.S.-China tech tensions and semiconductor supply chain resilience discussions.