ASML EUV Price Hike Sparks TSMC Pushback: What’s at Stake

The ASML EUV price hike dispute burst into public view in mid-July 2026, when The Information reported that ASML Holding, the sole global supplier of extreme ultraviolet lithography machines essential to making the most advanced computer chips, plans to raise prices on its equipment, setting up a clash with Taiwan Semiconductor Manufacturing Company, its single largest customer. TSMC is already pushing back against the plan, according to the report, in a standoff that illustrates how surging AI chip demand is reshaping pricing power across the entire semiconductor supply chain.

What ASML Is Proposing

ASML chief financial officer Roger Dassen told analysts on the company’s July 15 earnings call that there is “considerable room” for price increases, floating the possibility of raising prices even on its lower-cost, low numerical aperture EUV tools. Because ASML’s order backlog is long, Dassen cautioned that any pricing change would not “translate into pricing effects tomorrow.” The comments came the same week ASML raised its 2026 guidance for the second time this year and disclosed that its most advanced EUV systems are nearly sold out through the end of 2027, a sign of the leverage underpinning the ASML EUV price hike push. The company also outlined plans to expand EUV and DUV production capacity by 30% in each of the next two years to meet demand.

China Is Already Paying More

Ahead of any move on its cutting-edge EUV tools, ASML has already notified Chinese chipmakers of a 10% price increase on deep ultraviolet, or DUV, lithography machines, and The Information reported that some Chinese customers have already agreed to pay it. That willingness reflects China’s limited options: U.S. export restrictions bar Chinese firms from buying EUV machines outright, so DUV tools are the most advanced lithography equipment available to them, and losing access would halt their chip production entirely.

Why TSMC Is Resisting

TSMC has far more leverage than Chinese buyers, commanding roughly 73% of the global contract chipmaking, or foundry, market and manufacturing chips for Nvidia, Apple and other major customers. A DUV price increase is especially unwelcome because the tools are also central to chip-on-wafer-on-substrate packaging, an advanced technique connecting processors and memory that underpins TSMC’s AI chip business. TSMC has separately said its newest High-NA EUV machines, which cost upward of 350 million euros, or roughly $410 million, per unit, are too expensive to justify for production and are currently used only for research, with the company indicating it is unlikely to deploy the tool even for its future A13 process expected around 2029.

Part of TSMC’s leverage also comes from the structure of the lithography market itself. ASML is the only company in the world that makes EUV machines, giving it an effective monopoly on the equipment needed for the most advanced chips, while rivals such as Nikon and Canon still compete in older DUV segments. That monopoly ordinarily hands ASML enormous pricing power, but TSMC’s sheer scale as a buyer, and the fact that ASML depends on TSMC’s continued expansion to sell its highest-margin tools, gives the foundry a rare counterweight in the ASML EUV price hike negotiations that smaller customers simply do not have.

ASML, however, is using a rival’s decision as leverage in the ASML EUV price hike standoff, pointing to Intel’s acceptance of a price increase on High-NA EUV tools as Intel ramps up high-volume production of its 18A-based Panther Lake chips using the technology. By citing a major customer already paying the premium price, ASML is signaling to TSMC that the market can bear higher costs, even if TSMC itself remains reluctant to adopt the same equipment at scale.

TSMC Is Also Raising Its Own Prices

Even as it resists ASML’s proposed increases, TSMC has separately held talks with its own customers about raising chip prices by as much as 10% for 2027, according to Nikkei reporting, with base-price increases of 5% to 10% finalized this month covering both advanced and mature semiconductors. The overlap illustrates a broader “chipflation” dynamic: TSMC is squeezed by rising equipment costs from suppliers like ASML while simultaneously passing higher costs on to its own customers, including Nvidia and Apple, to protect its margins. RBC Capital Markets analysts wrote that booming results across TSMC, Samsung and SK Hynix make the environment “ripe” for ASML to push through its planned increases.

Limitations

Much of the reporting on the ASML EUV price hike traces back to The Information’s unnamed sources, relayed through outlets including Taipei Times, Seoul Economic Daily and TrendForce, rather than an on-record ASML statement detailing specific new prices for its EUV lineup. ASML’s only public comment came through Dassen’s general remarks about pricing “room” on the earnings call, without a formal price list. Whether TSMC ultimately accepts the increases, negotiates them down, or continues to resist has not been resolved in public reporting as of this writing.

FAQ

What is the ASML EUV price hike dispute about?

ASML, the sole maker of extreme ultraviolet lithography machines used to produce advanced chips, is reportedly planning to raise prices on its equipment, and TSMC, its biggest customer, is pushing back against the proposed increases.

Has ASML already raised prices anywhere?

Yes. ASML has notified Chinese chipmakers of a 10% price increase on DUV lithography tools, and some Chinese customers have already agreed to pay the higher price because they cannot access EUV equipment due to U.S. export restrictions.

Why does TSMC have more leverage than other ASML customers?

TSMC controls roughly 73% of the global foundry market and manufactures chips for Nvidia, Apple and other major customers, giving it more negotiating power than Chinese chipmakers facing export restrictions or ASML’s high-NA tools depending heavily on TSMC’s business.

Is TSMC also raising its own prices?

Yes. TSMC has finalized base-price increases of 5% to 10% for 2027 across advanced and mature chips, according to Nikkei, even as it resists ASML’s proposed increases on its own equipment.

Bottom Line

The ASML EUV price hike standoff shows how AI-driven demand is rippling through every layer of the chip supply chain, giving ASML enough pricing power to test its biggest customer while TSMC simultaneously passes its own rising costs on to chip designers like Nvidia and Apple. With ASML’s advanced tools nearly sold out for years and TSMC unwilling to simply absorb higher equipment costs, the outcome of these negotiations will likely shape chipmaking economics well beyond 2026.

Related Topic Express coverage

• Open Secure AI Alliance
• FCC humanoid robot ban

Featured image: Photo via Unsplash (photo-1558494949-ef010cbdcc31); free to use under the Unsplash License. Illustrative only.