ASML has warned that demand for its semiconductor manufacturing equipment will exceed its production capacity in both 2027 and 2028, despite plans to increase output as artificial intelligence investment drives demand for advanced chips.
The Dutch company is assessing whether it can expand its 2028 production capacity beyond a previously communicated 30% increase. Chief Executive Officer Christophe Fouquet also said some customers were already discussing orders for 2029 and 2030, reflecting expectations of sustained demand for chipmaking equipment.
The warning was included in ASML’s third-quarter 2026 financial results, published on October 14. The company did not disclose the precise number of additional machines needed to satisfy expected demand.
ASML manufactures lithography systems used by semiconductor companies to produce processors and memory chips. It does not manufacture the AI chips themselves, but its equipment is essential to producing some of the industry’s most advanced semiconductors.
The company’s capacity plans cover extreme ultraviolet (EUV) lithography systems and deep ultraviolet (DUV) immersion equipment. ASML previously outlined plans to increase production of both categories by 30% in 2027, with a further 30% increase planned for 2028. The stronger demand outlook has prompted management to examine whether additional expansion is necessary.
AI infrastructure spending is the primary driver of the rising demand forecasts. Semiconductor manufacturers are expanding their production plans as demand grows for advanced processors and memory used in AI computing systems. ASML also reported that customers expect their own chip supplies to remain insufficient to meet demand through at least 2028.
ASML reported third-quarter net sales of €11.66 billion and net income of €4.96 billion. Revenue increased approximately 55% from the same quarter a year earlier. The company raised its full-year 2026 revenue outlook to between €44 billion and €45 billion, compared with its previous range of €43 billion to €45 billion.
Expanding production presents supply-chain challenges because ASML’s lithography systems depend on highly specialised components. Its 2025 annual report identifies dependencies on critical suppliers, including Carl Zeiss SMT, which supplies important optical components used in its systems. The report warns that supplier production constraints can affect ASML’s ability to manufacture equipment.
ASML is also working to increase the productivity of equipment already installed at customer facilities. Its planned NXE:3800F EUV system is expected to raise throughput from 230 to 260 wafers per hour, with an initial limited introduction expected in 2027 and a more meaningful contribution from 2028 onwards, according to the company’s third-quarter management transcript.
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