ASML examines ways to make more than 110 EUV tools a year by 2028 as AI demand strains capacity

ASML Holding N.V., the Dutch semiconductor equipment maker that holds a virtual monopoly on extreme ultraviolet lithography machines, is studying how to push its annual production of EUV tools beyond 110 units in 2028, according to analysts at JPMorgan. The bank's conclusion, published on September 14, 2026, followed a meeting with ASML's chief financial officer and signals that the company's manufacturing capacity may be more flexible than it previously told investors.

The figures represent a steep escalation. ASML has said it expects to ship roughly 65 EUV systems in 2026, at least 80 in 2027, and is now targeting a 30% increase in 2028. JPMorgan analysts wrote that management indicated demand remains very very strong, and that most new orders are now for machines to be delivered in 2028. The 2027 order book is nearly sold out.

Behind the numbers is a simple reality: AI chips require massive amounts of EUV lithography. Every leading-edge processor and memory device from TSMC, Samsung, Intel, SK hynix and Micron depends on these machines to print features measured in nanometers. As AI accelerators and high-bandwidth memory consume more silicon area, the intensity of EUV use, meaning the number of EUV exposures per chip, is rising in the current cycle.

ASML does not build its tools alone. Carl Zeiss SMT, its exclusive supplier of lenses, mirrors and illuminators, is the critical bottleneck. Tom's Hardware reported on September 14, 2026, that Zeiss is adding around 25,000 square meters of production space at Oberkochen in southern Germany, four years after groundbreaking in 2022. ASML's own annual report states that the number of systems it can produce is limited by Zeiss SMT's production capacity.

Key Facts

JPMorgan analysts said on September 14, 2026, after meeting ASML's CFO, that the company is looking at ways to produce more than 110 of its EUV chip-printing tools in 2028. That compares with at least 80 units ASML has said it can make in 2027 and roughly 65 it expects in 2026, a targeted capacity increase of about 30% per year. Reuters reported on September 14, 2026, that ASML is nearly sold out of the machines for 2027 and that most orders are now for EUV machines to be delivered in 2028.

JPMorgan identified four routes by which ASML could reach 110 or more low-NA EUV tools without building new cleanrooms: reducing manufacturing cycle times in the second half of 2027; repurposing cleanroom space currently used for research and development; diverting capacity earmarked for high-NA tools to produce additional low-NA units until high-NA demand accelerates; and reactivating fast-shipment protocols used during the Covid-era supply crunch. The bank raised its own unit estimate to 90 tools as an initial step and flagged further upgrades as likely.

Proactive Investors reported on September 14, 2026, that JPMorgan concluded consensus earnings estimates for ASML are materially too low and require significant upgrades for 2027 and 2028. The bank estimates ASML held a 94% share of the global lithography market in 2025, maintaining a monopoly in EUV tools since the late 2010s. ASML's limiting factor, JPMorgan said, is the speed of EUV assembly, not the supply chain.

Concrete data points underscore the scale. ASML's CFO Roger Dassen said during the company's July 2026 earnings call that ASML is close to fully booked on low-NA EUV for 2027, is raising capacity by about 30% from roughly 65 systems in 2026, and is evaluating another 30% increase for 2028. He also said the company is compressing its scanner build cycle from around 22 weeks to 15 or 16 weeks. ASML's purchases from Zeiss SMT and its subsidiaries reached €4.41 billion in 2025, up from €3.95 billion in 2024 and €3.33 billion in 2023.

High-NA projection optics contain more than 40,000 parts and weigh about 12 tons, roughly seven times the volume and weight of standard EUV optics, with the illumination system adding another 25,000 parts and 6 tons. Intel became the first company to ship high-volume logic on 0.55 NA scanners in September 2026, with select Panther Lake layers on its 18A node now dual-qualified. ASML reported Q2 2026 net sales of €9.3 billion and net income of €2.9 billion, and raised its 2026 guidance to €43-45 billion.

Analysis

What this really means is that ASML's capacity ceiling is not a fixed physical wall but a set of engineering and scheduling constraints that management believes it can loosen. The company spent years telling investors that its output was capped, first by supply chain issues and then by assembly speed. Now, according to JPMorgan, ASML is signaling that its previously communicated ceiling of 90 EUV tools is not a hard limit and that volumes can be expanded without constructing new cleanrooms. That shift matters because it changes the revenue trajectory for 2027 and 2028.

The bottleneck, however, has not disappeared. It has simply moved to Zeiss SMT. The optics supplier is the only company that can build the optical columns inside ASML's scanners, and ASML's annual report warns that if Zeiss could not sustain production over a prolonged period, ASML would effectively cease to be able to conduct its business. The expansion at Oberkochen, adding around 25,000 square meters, is therefore as important to ASML's growth as any internal assembly improvement. Zeiss SMT posted €5.055 billion of segment revenue in fiscal 2025, up 23%, a sign of how much demand is already flowing through that pipeline.

The demand picture also supports the bullish case. Reuters reported on September 14, 2026, that Intel is seen becoming a meaningful customer again in 2027, with new customers including Elon Musk's Terafab developing. Sales to Chinese memory chip makers will be stronger in 2027, according to the same reporting. Adoption of next-generation High NA tools will start in 2028 but more meaningfully over the next decade, which means low-NA EUV will carry the volume for years. Given laser advances, ASML sees no reason to try the new FEL light source favored by Musk.

The bigger picture here is that ASML is effectively the gatekeeper of the AI hardware boom. If it can deliver more than 110 EUV tools in 2028, it will unlock capacity for TSMC, Samsung, Intel, SK hynix and Micron to build the chips that data centers need. If it cannot, the entire supply chain slows. The four routes JPMorgan outlined are not trivial, but they are within ASML's control. The question is execution speed.

Why It Matters

For chipmakers, ASML's output is a leading indicator of how quickly they can expand advanced production. A 30% increase in low-NA EUV shipments from roughly 65 units in 2026 to at least 80 in 2027 and potentially more than 110 in 2028 would translate into tens of billions of dollars of additional wafer capacity. That capacity is needed for AI accelerators, high-bandwidth memory and advanced logic.

For the wider technology industry, the numbers reveal how concentrated the AI supply chain remains. One Dutch company and one German optics supplier effectively determine the pace of Moore's Law for the most advanced chips. Global Banking & Finance Review reported on September 14, 2026, that ASML is nearly sold out of its 2027 EUV output and is considering a further 30% capacity increase for 2028 to exceed 110 units, supported by strong AI-driven demand and a broad customer backlog. The report also noted that optics production via Zeiss is cited as a bottleneck.

For investors, JPMorgan's note is a signal that consensus estimates for ASML may be too low. The bank's own estimate of 90 tools is an initial step, with further upgrades likely. ASML's Q2 2026 results, with net sales of €9.3 billion and net income of €2.9 billion, already showed the financial leverage of higher volumes. If the company can push toward 110 tools or more, the revenue and earnings impact would be significant.

Next Up

ASML will need to demonstrate progress on the four routes JPMorgan identified. The most immediate test is the cycle time reduction in the second half of 2027, alongside the ongoing build cycle compression from 22 weeks to 15 or 16 weeks. The first completed building at Zeiss's Oberkochen expansion, with staff moving in this month, will be watched as a proxy for optics capacity.

Intel's ramp on 18A with 0.55 NA High-NA scanners, and the development of new customers such as Terafab, will shape demand for 2027 and 2028. Chinese memory makers are expected to increase purchases in 2027. ASML has said High-NA adoption will start in 2028 but become more meaningful over the next decade. For now, the market will look for confirmation that ASML can actually deliver more than 110 EUV tools, not just examine ways to do so.