EXTREME ULTRAVIOLET (EUV) LITHOGRAPHY MARKET ANALYSIS

Extreme Ultraviolet (EUV) Lithography Market Size and Trends

Global extreme ultraviolet (EUV) lithography market is estimated to be valued at US$ 9.42 Bn in 2024 and is expected to reach US$ 28.76 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 17.3% from 2024 to 2031.

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The Global Extreme Ultraviolet (EUV) Lithography Market is experiencing significant growth due to growing demand for integrated circuits with improved resolution and increasing applications of EUV lithography in the semiconductor industry. There will be huge demand for EUV lithography due to ongoing trend of device miniaturization. Manufacturers are increasingly adopting EUV lithography technology as it enables production of microchips with smaller features compared to traditional lithography methods. The need for higher resolution patterning compel semiconductor companies to deploy EUV lithography solutions.

Market Driver - Increasing Demand for Advanced Semiconductor Devices

Powerful smartphones, computers and other electronic devices require more sophisticated and compact chips in order to add new features, capabilities and deliver high performance. Semiconductor devices have become integral part of one’s daily lives and presence of chips in many of new household products can boost demand for Extreme Ultraviolet (EUV) Lithography. Devices such as smartphones have witnessed rise in adoption of faster processors and higher memory chips which support imaging, gaming and multimedia capabilities. Emergence of technologies such as AI, machine learning and 5G networks will add exponentially to data processing requirements of new devices.

Semiconductor manufacturers are under constant pressure to further miniaturize components and integrate more transistors into a single chip to meet performance and power goals. This compel them to adopt more advanced lithography techniques that can print finer patterns compared to conventional alternatives. While existing optical lithography technologies have nearly reached their capability limits, EUV lithography presents the most viable solution to enable further device scaling below 7nm node. It allows creating finer lines and spaces which is crucial for next generation logic and memory chips. 

Market Concentration and Competitive Landscape

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Growing Complexity of Integrated Circuits Requiring Advanced Lithography Techniques

There has been an unrelenting march towards integrating more transistors within the same silicon real estate to deliver enhanced functionality, affordability and efficiency of electronic systems. Semiconductor industry has continually encountered challenges related to device miniaturization as components size shrinks with each successive technology generation. Integrated circuits used to power new and emerging technologies like AI, IoT, autonomous vehicles require incredibly higher performance at much lower power levels. This growing complexity of chip designs exerts immense pressure on chipmakers to integrate billions of transistors on a single die, a requirement that existing lithography tools struggle to fulfil.

Developing chips for applications like data centres, supercomputers and edge servers pose even stiffer density demands. Achieving higher circuit density while maintaining process control and reliability require lithography techniques with much greater resolution, depth of focus and wafer throughput. While multi-patterning techniques were serving this purpose till date, these involve expensive multiple exposure steps thus limiting productivity. EUV lithography emerges as the most promising solution capable of precisely printing ever tinier features with a single exposure. It allows chip architects to place and interconnect record number of transistors on a die, thus, overcoming density bottlenecks. Leading foundries have been collaborating with lithography vendors to accelerate EUVL adoption in high volume manufacturing to meet the diverse performance needs of next gen systems. Relentless pursuit of achieving tera-scale integration levels can boost adoption of advanced lithography capabilities like EUV.

For instance, in January 2024, ZEISS Group, a leading provider of optical systems and semiconductor manufacturing technology, unveiled its High-NA (Numerical Aperture) Extreme Ultraviolet (EUV) lithography system. This advanced system marks a significant advancement in semiconductor manufacturing, enabling the production of microchips with exceptionally fine features, surpassing the capabilities of existing EUV systems. The High-NA-EUV technology will facilitate the creation of more powerful, energy-efficient, and cost-effective chips, setting the stage for the next generation of integrated circuits.

Key Takeaways from Analyst:

Global extreme ultraviolet (EUV) lithography market growth is driven by  factors like faster chip production. The ability to print smaller circuit features compel semiconductor manufacturers to increasingly adopt EUV technology. Rising demand for more powerful and energy-efficient chips from industries like automotive, smartphone and data centers can boost lithography equipment upgrades.

High investment costs can hamper the market growth. EUV tools require massive capital expenditures and their source power needs also increases to meet customer throughput targets. Sustaining adequate supply of key system components can hamper the market growth.

Asia Pacific is expected to continue its dominance in the market. This can be accredited to the high concentration of foundries and IDMs in Taiwan, South Korea and China pursuing advanced nodes. Government initiatives in these nations to boost domestic semiconductor manufacturing can drive the market growth. Europe and U.S. are also ramping investments to build EUV competence and reduce reliance on other regions.

Market Challenge - High Cost of EUV Lithography Equipment and Technology

Global extreme ultraviolet (EUV) lithography market growth  can be hampered due to high cost involved with EUV lithography equipment and technology. The EUV lithography tools and machinery required for semiconductor manufacturing purposes are extremely expensive with the current cost of a single EUV scanner being US$ 120 million. EUV lithography scans require stable and uninterrupted power beams which can only be produced using complex and expensive laser-produced plasma sources. This high initial capital expenditure required for setting up an EUV lithography line has been a deterrent for many semiconductor foundries, especially smaller ones with limited budgets. The costs of maintenance and regular upgradation of these EUV machines are also high due to their complexity. With ongoing research and development as well as larger scale production, the costs of EUV lithography are expected to reduce gradually but the current high prices remain a major roadblock for greater adoption of this next-generation lithography technology.

Market Opportunity - Expansion of Semiconductor Market in Emerging Economies

Global extreme ultraviolet (EUV) lithography market can witness growth due to expansion of the overall semiconductor market in emerging economies. Countries like China, India, Brazil, Indonesia and others are witnessing tremendous economic development, and this boosts growth of various industries and increases demand for electronic products. This positively impacts the semiconductor industry of these nations. The market for devices like smartphones and computers witness exponential growth in the developing world. This growing necessity for sophisticated semiconductors provides significant scope for EUV lithography technology to be implemented on a wider scale in the semiconductor industries of emerging economies going forward.

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By Type - Demand for advanced technology drives lithography equipment segment

In terms of type, lithography equipment segment is estimated to contribute the highest market share of 51.5% in 2024, owing to growing demand for improved resolution from chip manufacturers. The constant race to pack more transistors into a given die area necessitates the use of newer lithography technology nodes. Compared to older immersion lithography tools, EUV lithography equipment allows chip designs to be shrunk to much smaller dimensions without loss of yield or fidelity. This enables semiconductor foundries to drive innovation in areas such as AI, 5G, and autonomous vehicles. As architectures become more complex, the lithography equipment performs a critical role in facilitating advances. For instance, in June 2022, ASML, a leading supplier to the semiconductor industry known for its advanced lithography equipment, launched a new technology education initiative called the ASML Junior Academy in partnership with Mad Science. This program aims to provide technology education to all 271 primary schools in the Brainport Eindhoven region, enabling approximately 60,000 children to learn about technology each year. The ASML Junior Academy will kick off in September with lessons offered at fifty primary schools, focusing on engaging students in STEM (science, technology, engineering, and math) subjects.

By Type - Demand for advanced technology drives lithography equipment segment

In terms of type, lithography equipment segment is estimated to contribute the highest market share of 51.5% in 2024, owing to growing demand for improved resolution from chip manufacturers. The constant race to pack more transistors into a given die area necessitates the use of newer lithography technology nodes. Compared to older immersion lithography tools, EUV lithography equipment allows chip designs to be shrunk to much smaller dimensions without loss of yield or fidelity. This enables semiconductor foundries to drive innovation in areas such as AI, 5G, and autonomous vehicles. As architectures become more complex, the lithography equipment performs a critical role in facilitating advances. For instance, in June 2022, ASML, a leading supplier to the semiconductor industry known for its advanced lithography equipment, launched a new technology education initiative called the ASML Junior Academy in partnership with Mad Science. This program aims to provide technology education to all 271 primary schools in the Brainport Eindhoven region, enabling approximately 60,000 children to learn about technology each year. The ASML Junior Academy will kick off in September with lessons offered at fifty primary schools, focusing on engaging students in STEM (science, technology, engineering, and math) subjects.

By Application - Rising Demand for smart devices boosts semiconductor manufacturing

In terms of application, semiconductor manufacturing segment is estimated to contribute the highest market share of 67.8% in 2024, due to strong demand for sophisticated logic ICs. Consumer appetite for smart technology including smartphones, laptops, wearables, and home appliances drives fabless semiconductor companies to design increasingly powerful yet efficient silicon. EUV lithography facilitates manufacturing advanced system-on-chips with very high transistor counts. This allows integrating cutting-edge functionality into ever smaller semiconductor packages. As digital products become ubiquitous in everyday lives, lithography maintains momentum by enabling manufacturers to develop affordable solutions for a tech-savvy population.

Regional Insights

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North America dominates the global extreme ultraviolet (EUV) lithography market with an estimated amrket share of 36.4% in 2024, due to strong presence of major chipmakers and lithography equipment providers in the region. The U.S. is home to semiconductor giants like Intel, which is at the forefront of using EUV lithography in its advanced manufacturing facilities. Meanwhile, all major EUV lithography system suppliers like ASML are headquartered in North America, giving the region an edge in terms of access to latest technology and equipment.

North America witness significant government funding and initiatives aimed at bolstering semiconductor manufacturing capabilities. For example, the CHIPS Act passed last year allocated billions towards increasing domestic chip production and R&D activities. This creates conducive environment for the growth of EUV lithography adoption. The robust expenditure on research by both private and public entities has helped North America progress at the leading edge of chip technology roadmaps where EUV lithography serves as a critical part.

Asia Pacific region, led by countries like South Korea and Taiwan, is projected to be the fastest growing market for EUV lithography as several major foundries with large production capacities are located within the region cater to growing global demand for semiconductors. For instance, Samsung and TSMC have deployed multiple EUV lithography tools across their fabs in a bid to enhance wafer output. There has also been a notable rise in domestic chip manufacturing within several Asia Pacific nations, stimulating additional EUV lithography system procurement. 

Market Report Scope

Extreme Ultraviolet (EUV) Lithography Industry News

• In July 2023, Canon, a global leader in imaging and optical products, unveiled a new photomask technology specifically designed for Extreme Ultraviolet (EUV) lithography. This innovative technology aims to enhance the precision and efficiency of semiconductor manufacturing, enabling the production of smaller and more complex microchips. Canon's advancements in photomask technology are expected to play a crucial role in meeting the growing demands of the semiconductor industry, particularly as manufacturers strive for greater miniaturization and performance in their chips.
• In March 2023, TSMC (Taiwan Semiconductor Manufacturing Company), the world's largest dedicated independent semiconductor foundry, announced plans to expand its EUV (Extreme Ultraviolet) lithography capabilities at its manufacturing facilities. This expansion is part of TSMC's ongoing efforts to enhance its advanced chip production processes, allowing the company to meet the increasing demand for smaller, more powerful microchips. By investing in EUV technology, TSMC aims to maintain its competitive edge in the semiconductor industry and support the development of next-generation devices that require advanced manufacturing techniques.
• In December 2021, ASML, a Netherlands-based company and the world's leading provider of semiconductor manufacturing equipment, announced the release of a new version of its extreme ultraviolet (EUV) lithography systems. These cutting-edge machines are essential for etching intricate patterns onto silicon wafers, enabling the production of the most advanced CPUs. Major chipmakers like Samsung, TSMC, and Intel utilize ASML's existing EUV technology to develop the next generation of processors for PCs and smartphones. ASML's innovative EUV lithography systems are at the forefront of semiconductor manufacturing, driving the industry forward and supporting the development of increasingly powerful and energy-efficient electronic devices.
• In March 2021, Samsung, a major player in the global semiconductor industry, announced plans to increase production of its EUV (Extreme Ultraviolet) scanners, aiming to compete with TSMC, the world's largest foundry. Unlike traditional lithography machines, EUV scanners streamline the chip fabrication process by reducing the number of photolithography steps needed to create finer circuits. This technological advancement is driving competition among leading chipmakers as they strive to adopt EUV technology for improved manufacturing efficiency and capability.

*Definition: Global extreme ultraviolet (EUV) lithography market involves the manufacturing and sales of lithography systems that use Extreme Ultraviolet (EUV) light with a wavelength of around 13.5 nm for semiconductor manufacturing. EUV lithography is considered the most advanced chipmaking technology as it allows the creation of much smaller microchip features, enabling higher performance and lower power processors. It allows chip makers to continue following Moore's law and produce more advanced logic and memory chips for applications like computers, smartphones, and others.

Market Segmentation

•  Type Insights (Revenue, US$ Bn, 2019 - 2031)
• • Lithography Equipment
  • Photomasks
  • Light Sources
  • Others
•  Technology Insights (Revenue, US$ Bn, 2019 - 2031)
• • EUV Lithography System
  • Mask/Etch Technology
  • Others
•  Application Insights (Revenue, US$ Bn, 2019 - 2031)
• • Semiconductor Manufacturing
  • Microelectronics
  • Others
• Regional Insights (Revenue, US$ Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East
    • GCC Countries
    • Israel
    • Rest of Middle East
  • Africa
    • South Africa
    • North Africa
    • Central Africa
• Key Players Insights
  • ASML Holding N.V.
  • Nikon Corporation
  • Canon Inc.
  • Intel Corporation
  • Samsung Electronics Co., Ltd.
  • TSMC (Taiwan Semiconductor Manufacturing Company)
  • GlobalFoundries
  • Micron Technology, Inc.
  • Applied Materials, Inc.
  • Lam Research Corporation
  • KLA Corporation
  • Tokyo Electron Limited
  • Advantest Corporation
  • Hitachi High-Technologies Corporation
  • Teradyne, Inc.