ASML remains the undisputed king in an exceptional chip year: 'This is only the beginning'
It’s freezing cold in Veldhoven, but behind ASML’s walls you’d think a blazing summer has just erupted. Anyone driving through the Brainport region in recent weeks could see it not only from the cranes jutting out above the new buildings – the figures coming out of Asia don’t lie. The hunger for chips is back, and not just a little. Samsung, one of the biggest players in the world, has raised the prices of its DDR5 and HBM memory by no less than 30 per cent. That’s no mere correction; it’s a statement.
For the real market insiders, this has been clear for a while. The ‘dip’ earlier this year was nothing more than holding your breath before a proper plunge. The South Korean giant’s profits have simply exploded, driven by a demand for memory chips that just won’t be satisfied. And guess who’s the only party on earth that supplies the most cutting-edge machines to make those things? Exactly. That’s where ASML has its golden grip.
From ASML Building 3 to the Eindhoven marathon: a region focused on the future
It’s almost symbolic. On one side of Eindhoven, thousands of runners are preparing for the Marathon Eindhoven, an event that turns the city upside down every year. It’s the ultimate metaphor for endurance. On the other side, a few kilometres away in Veldhoven, ASML Building 3 is rising. This is not just another office block; it’s a fortress of innovation, built to keep meeting demand for the next ten years. The tech marathon, if you will.
The contrast with what’s happening elsewhere in the world is enormous. While regions like the Middle East are distracted by conflicts – I’m thinking of groups such as the Arab Struggle Movement for the Liberation of Ahwaz with entirely different priorities – the sandy soil of Brabant is simply too fertile for technology. There’s no fighting over ideology there, but over nanometre switching and light intensity. No gunshots, just wafers being exposed at the speed of light.
What I find so bizarre about ASML is how un-Dutch it actually is. We’re a country of trade, water management and ‘just act normal’. And yet in our backyard sits a company that determines the entire global semiconductor order. Without the EUV machines from Veldhoven, not a single high-end data centre or premium smartphone would run. That’s not showing off; that’s just reality.
Why this autumn will decide everything for the chip giant
Let’s take a look at the numbers coming in now. Samsung’s profit explosion isn’t the result of one-off windfalls. It’s the new normal. AI models gobble up HBM memory like it’s free beer at a Brabant fair. The 30 per cent price hike is a direct consequence of that scarcity, and that’s while the Korean production lines are already running at full tilt.
This is the point where I want you to pause for a moment and consider the supply chain.
- Step 1: Samsung can’t make its chips fast enough.
- Step 2: To make more, they need the most advanced lithography machines.
- Step 3: Those machines come only from Veldhoven.
- Step 4: ASML can therefore literally set the price for the future of AI and computing.
That position of power is unique. And while construction of Building 3 progresses, I’m looking forward to the Marathon Eindhoven. They seem like two separate worlds, but it’s exactly the same principle: you can’t win if you haven’t trained for the long distance. ASML understood that long before the rest of the world realised that chips are the new gold. The fourth quarter of 2024? It’s going to be a party. Get your running shoes ready – and your wallet.