ASML’s sales to China allow chips to be produced in the country using “legacy nodes”،
Have you ever wondered how tens of billions of transistors fit into a small chip? The discovery, production and continued improvement of semiconductors is one of man’s most astonishing achievements. And the lithography machines used to etch circuit patterns onto the silicon wafers cut into multiple dies are also incredible. There is only one company that makes extreme ultraviolet (EUV) lithography machines: a Dutch company called ASML.
EUV is the machine that took chips from the 10nm process node to the 3nm chips currently used this year on the iPhone 15
Pro and iPhone 15 Pro Max only (thanks to the A17 Pro). Next year, we should see more handsets powered by 3nm silicon. How fine are the patterns engraved by the EUV machine? A human hair has a diameter of 70 microns (each micron is 0.00004 inches, meaning there are 25,000 microns in an inch), which is 1,000 times the diameter of the patterns etched onto a wafer by the EUV machine .
Dutch manufacturer ASML still allowed to ship older lithography machines to China
Advanced lithography equipment is not allowed to ship to China due to US restrictions. But sanctions don’t stop ASML from shipping old lithography machines into the country, allowing foundries like SMIC (China’s largest) to produce existing chips (larger node chips) used on automobiles and household appliances. Some also believe that an ancient DUV (deep ultraviolet lithography) machine helped SMIC produce the 7nm Kirin 9000s 5G chip that stunned the smartphone industry when it was discovered in Huawei’s latest flagship lineup, the Mate 60, last summer.
ASML’s DUV machines are not allowed to ship to China
According to
South China Morning PostLast week, at a media event, Shen Bo, ASML’s senior vice president and head of its China division, said: “Demand outside China has seen large fluctuations during the market cycle bearish…but China’s current demand for mature node products remains very strong. We were told by our [Chinese] customers that orders should be delivered as quickly as possible. This year gave us a chance to catch our breath and catch up on the “debts” we owed to global and Chinese customers over the past two years. »
ASML has a backlog of $37 billion that needs to be shipped. These orders were placed in 2021 and 2022 and include some orders intended to ship to China. If the United States tightens its export restrictions, which has been raised as a possibility following Huawei’s unveiling of the Mate 60 series powered by the Kirin 9000s 5G chipset, some or all of the orders for the China could be canceled.
ASML seeks to increase its workforce in China
ASML’s Twinscan 2000 DUV series will not be delivered to China from January 1st. This machine can be used to help manufacture advanced 7nm and 5nm chips. Orders from China accounted for 46% of ASML’s third-quarter revenue and Shen says ASML will look to increase its repair, service and product development activities in China while increasing its workforce. work in the country over the next two years.
Even if ASML helps Chinese foundries produce chips using existing nodes, it still won’t be able to ship its cutting-edge EUV lithography machines to China, including the new High-NA machine. The U.S. Commerce Department is using its power to try to stop China from producing powerful silicon that supports 5G. The United States may not be worried about Huawei producing smartphones that compete with the iPhone (or maybe they are). The real concern is that advanced chips will be obtained and deployed by the Chinese military.
