The AI super wave reshapes the chip supply and demand landscape! Asicme's latest outlook reinforces the bull market logic of chip stocks.

Dutch lithography giant ASML Holding NV ADR (ASML.US) CEO Christophe Fouquet stated that the flourishing global semiconductor market will face a long-term supply shortage in the foreseeable future and forecasted that the global semiconductor market could reach a staggering $1.5 trillion by 2030. Almost simultaneously, international bank UBS Group AG (UBS) raised the target stock price for this Dutch semiconductor equipment manufacturer, reinstated it as the top stock in the global semiconductor sector, and raised the ASML Holding NV ADR stock price from the previously set 1600 euros to 1900 euros. As of the mid-week European stock market opening, ASML Holding NV ADR stock price was hovering around 1300 euros. Fouquet stated in an interview that the demand for chips dominated by cutting-edge technologies such as AI, space satellite systems, and Siasun Robot & Automation far exceeds the industry's production capacity. He also mentioned that the global semiconductor market could reach $1.5 trillion by 2030 (the market size is estimated to be around $800 billion by 2025), and stated that "the demand for AI is so strong that the market will be in a supply-constrained state for a considerable amount of time." This signifies a shift in the core contradiction of the global chip industry, moving from the past "demand cycle fluctuations" to "the capacity expansion speed of AI computing infrastructure leading to a faster expansion rate than semiconductor equipment, wafer plants, and advanced packaging and testing factory expansion speeds." ASML Holding NV ADR is the most valuable listed company in Europe, dominating the market for systems used to print/print the highest technology chip microcircuits in human society to date. Its most advanced EUV lithography tools are essential for producing essential logic chips for artificial intelligence data centers and the associated DRAM/HBM memory chips. Advanced process chip manufacturers such as Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR and Intel Corporation have a near-endless demand for ASML Holding NV ADR's EUV equipment, strong demand for extreme ultraviolet lithography equipment, helping this Dutch semiconductor equipment manufacturer become the most valuable company in Europe. In the US stock market, the ASML Holding NV ADR American depositary receipt (ASML.US) has risen by 45% in cumulative return so far this year, reaching record highs. In the view of major investment institutions such as UBS Group AG, Citigroup, and KeyBanc, a new round of "main uptrend" in ASML Holding NV ADR stock price has already begun. ASML Holding NV ADR's EUV lithography machine, it can be said that since 2023, under the unprecedented global AI boom, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR, Samsung Electronics, and other largest chip manufacturers have built the necessary semiconductor equipment for the world's most cutting-edge AI applications, such as ChatGPT and Claude, as well as the core DRIVE for AI chips. Under the backdrop of a possible "storage chip supercycle" lasting until 2028, companies such as SK Hynix and Micron Technology, Inc. are preparing to use this new technology to produce HBM memory systems, data center enterprise-grade DRAM storage components, and other essential storage devices. "The demand for chips dominated by artificial intelligence is so strong that we will be in a market state severely limited by supply for a considerable amount of time," Fouquet said, pointing out that the epic chip manufacturing project proposed by Tesla, Inc. and SpaceX's helm, Elon Musk - the "TeraFab" artificial intelligence project and the Starlink super satellite system, and a series of grand plans may drive a new, stronger demand wave. Musk himself has sparked the "Terafab" AI computing storm, aiming to end the chip supply shortage with "human-made chip miracles." Fouquet stated that as new technologies continue to emerge, ASML Holding NV ADR is actively increasing production and improving the efficiency of lithography tools to keep up with the market pace. However, he also warned that the scale of this wave is difficult to predict and may catch the industry off guard. Fouquet also expects the first batch of high-performance chips manufactured with its next-generation lithography machine - the High-NA EUV lithography machine, to be officially delivered in the coming months. According to ASML Holding NV ADR's official description, High-NA EUV will be targeted at the most advanced chip processes after 2nm - especially critical graphic platforms for 1.8nm/1.4nm levels and subsequent process nodes, and will also cover the most critical manufacturing layers for storage chips such as DRAM. "In the next few months, we will see the first batch of products, including some HBM/DRAM memory chips and logic chips, exposed on the High-NA lithography system," he stated at a conference organized by the research organization imec in Antwerp, Belgium. UBS Group AG reignites the "bull market narrative" for ASML Holding NV ADR: target price raised to 1900 euros In their latest research report, UBS Group AG significantly raised the target stock price for this Dutch semiconductor equipment manufacturer, reinstated it as the top stock in the global semiconductor sector, and raised the ASML Holding NV ADR stock price from the previously set 1600 euros to 1900 euros. Senior analyst Franois-Xavier Bouvignies from UBS Group AG wrote in a report to clients, "Capacity concerns have become the focus, as the market is worried that ASML Holding NV ADR's production bottlenecks may limit semiconductor supply. Our analysis shows that ASML Holding NV ADR's capacity in 2027 can support a more than 50% year-on-year growth in leading process wafer output (including logic and storage), while demand is around 25-30%, but the base is much larger, with about 20% of the output increase coming from the underestimated Low NA throughput improvements. Although productivity improvements may moderately dilute lithography strength due to other process steps (CMP, HAR etching, hybrid bonding, thin film deposition, etc. semiconductor/advanced packaging equipment) failing to keep up, we do not expect ASML Holding NV ADR's capacity to become a bottleneck in the next 12/18 months." In addition, Xavier Bouvignies stated that if the current strong demand trend in the storage chip sector continues, ASML Holding NV ADR will be one of the major beneficiaries. UBS Group AG analyst Xavier Bouvignies added, "With constructive prospects for the next two years for HBM/DRAM memory chips, the supply chain is expected to benefit - especially participants benefiting from the increase in WFE intensity - as node miniaturization will drive an increase of about 30% in the number of wafers per wafer (from 1b to 1c), an increase in lithography strength, and an additional 1-2 layers of EUV layers expected at the 1d node (2027/2028). ASML Holding NV ADR is the company with the highest exposure in the storage area among global semiconductor equipment companies (expected to account for about 30-35% of revenue by 2026, while peers account for about 25-30%), reflected in a more robust growth trajectory in performance (compound annual growth rate of storage business revenue from 2020 to 2025 is 23%, compared to about 6%), as well as in the ongoing expectations of lithography strength (from 11% in 2020 to about 15% by 2025, and expected to reach about 15-20% in 2027/2028)." Veteran chip manufacturing giant Intel Corporation (INTC.US) has always been one of the most aggressive chip manufacturers preparing for the adoption of ASML Holding NV ADR's High-NA lithography equipment, trying to surpass its long-time competitors Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR and Samsung. In addition, recent reports indicate that storage chip manufacturers like SK Hynix are planning to use this new technology to produce HBM/DRAM memory chips. From an industrial fact perspective, High-NA entering DRAM is a clear direction. ASML Holding NV ADR officials stated that their EUV system supports the mass production route for sub-2nm logic nodes and leading DRAM nodes, so High-NA is more likely to be used for critical layers such as 1d/1e and subsequent advanced DRAM layers, supporting HBM with higher density, bandwidth, and lower power consumption in the AI era. High-NA will be used first for a few critical, ultrathin graphic layers in advanced DRAM/HBM, to increase single exposure resolution and reduce multiple graphic steps, driving further density reduction in DRAM units. From an industrial progress perspective, SK Hynix is one of the clearest promoters of advanced DRAM/HBM progress. Reports suggest that SK Hynix plans to purchase approximately $7.97 billion worth of EUV equipment from ASML Holding NV ADR for new capacities such as Yongin and M15X, with the aim of producing HBM and advanced DRAM needed for AI; and SK Hynix has assembled the first commercial High-NA EUV lithography system at the M16 factory in Ichon, South Korea, for rapid development of advanced HBM/DRAM structure prototypes and future transition to mass production. The essence of HBM is a multi-layer stack of DRAM dies + TSV + advanced packaging, with each layer of the DRAM die still relying on the previous DRAM process. As AI demands higher capacity, bandwidth, and lower power consumption, DRAM units, peripheral circuits, bit lines/word lines, metal interconnects, and other critical graphic layers continue to shrink, thus highlighting the exclusive value of High-NA. Its significance is not in "stacking higher HBM" itself, but in making each DRAM die denser, more energy efficient, with fewer graphic steps, a more controllable yield/cost curve, thereby supporting the future generations of HBM4E, HBM5, or subsequent generations. AI-dominated chip demand surpasses capacity! EUV lithography steps into the eye of the supply shortage storm Recent developments regarding advanced process AI chips and storage chip demand and capacity expansion in the semiconductor industry have been positive and promising. As global tech giants such as Microsoft Corporation, Alphabet Inc. Class C, and Meta push forward with the construction of global super-scale AI data centers, driving the expansion of 3nm and below advanced process AI chip production, as well as CoWoS/3D advanced packaging capacity, DRAM/NAND storage chip capacity, the long-term bullish logic for the semiconductor equipment sector is becoming increasingly resilient. Under the AI super wave, AI GPU/AI ASIC advanced process logic chips, HBM/DRAM/NAND storage chips, and high-performance chips closely associated with the power chain of AI data centers and high-performance chips used in AI computing clusters and DCI connections within the data center, will undoubtedly be in a long-term supply-demand balance. ASML Holding NV ADR will also be one of the core beneficiaries in this major trend of chip supply shortage, as it controls the "throat equipment" for expanding advanced chip processes - EUV/DUV lithography systems. Whether it's Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR behind NVIDIA Corporation's ecosystem or Samsung, SK Hynix, Micron, Intel Corporation, the expansion of advanced logic, HBM/DRAM, and AI computing infrastructure-related chips cannot be done without ASML Holding NV ADR lithography equipment. The first batch of chips manufactured with ASML Holding NV ADR's latest High-NA EUV is set to hit the market soon, with High-NA being able to shrink feature sizes up to 66% more, a prospect Intel Corporation, Samsung, SK Hynix, and others are advancing towards; this further strengthens ASML's strategic position in the post-2nm era, AI logic chips, and advanced storage manufacturing. ASML Holding NV ADR's latest forecast significantly boosts the long bullish logic of the global chip market, indicating that the chip demand driven by AI data centers, Starlink satellites, Siasun Robot & Automation, autonomous driving, and future TeraFab-level super chip factories will expand the chip demand from a single cloud training to a more comprehensive cloud AI reasoning system, physical AI, and edge AI cloud connection demands. This will provide long-term strong fundamental support for global chip behemoths such as ASML Holding NV ADR, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR, SK Hynix, Micron, NVIDIA Corporation, AMD, Intel Corporation, Applied Materials, Lam Research, among others. ASML Holding NV ADR CEO predicts that the global semiconductor market could reach a staggering $1.5 trillion by 2030, compared to the estimated market size of around $800 billion by 2025.