The Latest News In Lithography

JSR up for sale?; FEL funding; mask trends; mid-year forecasts—chips, memory, EUV

By Mark LaPedus

For decades, lithography has been an important part of the semiconductor industry. Lithography is a technology that is used to process and develop today’s chips. It is required to make the world’s most advanced chips.

Lithography is a complex business with a multitude of facets. To help the industry, Semiecosystem has compiled the latest and more significant company and technology announcements in lithography and related topics. Here’s the latest:

1—Is JSR up for sale?

2—More JSR

3—FEL Funding

4—Mask Trends

5—Mid-year forecasts—chips, memory, EUV

I have written about each of these topics below.

Is JSR up for sale?

Japan Investment Corp. (JIC), the parent company of Japan’s JSR, is considering selling the supplier of photoresists and other products, according to a report from Reuters. Fujifilm and Mitsubishi Chemical are possible suitors for JSR, according to the report.

JIC declined to comment. “As your questions relates to a specific matter concerning JSR, JIC does not comment on individual cases, including the status of any review or related facts,” according to officials from JIC.

Based in Tokyo, JSR is a major supplier of electronic materials, including photoresists, chemical mechanical polishing (CMP) slurries, deposition products and others. The company also sells materials for displays, life sciences, optical products and plastics.

It’s been a topsy turvy period for JSR. In 2023, JIC, a fund backed by the government, acquired JSR for 903.9 billion yen (US$6.3 billion). Following those events, JSR was delisted and taken private.

In 2024, JSR posted a loss of 217.7 billion yen on sales of 388.8 billion yen. The deficit was mainly due to losses in its life sciences unit.

Then, in 2025, JSR rebounded and reported a net profit of 60.7 billion yen. In 2025, sales were 440.7 billion yen, up 13.3% over 2024. The growth was driven by demand for electronic materials and improved profitability in the life sciences group.

Nonetheless, a potential sale of JSR would have major implications in the semiconductor supply chain. In 2021, JSR acquired Inpria, a supplier of metal oxide photoresists for extreme ultraviolet (EUV) lithography. Then, in 2024, JSR acquired Yamanaka Hutech, a supplier of high-purity chemicals used in the semiconductor industry.

Last year, JSR formed a partnership with Lam Research. The companies will collaborate to integrate JSR/Inpria’s patterning resists and films with Lam’s etch and dry resist deposition technologies.

For years, the industry has touted metal oxide resists for EUV lithography. Yet, metal oxide resists have struggled to get a major foothold in the EUV market. For EUV, chipmakers tend to use traditional chemically amplified resists (CAR).

There is an opening for metal oxide resists, however. For the emerging high-numerical aperture (high-NA) lithography market, chipmakers (i.e. Intel, Samsung, SK hynix, TSMC) are evaluating several resist types, including CAR and metal oxide.

Time will tell if metal oxide resists will ever live up to its promises. Time will also tell if JIC will unload JSR.

More JSR

U.S.-based Entegris and JSR recently entered into a non-exclusive cross-licensing agreement.

Under the agreement, Entegris and JSR’s Inpria unit will cross-license metal oxide resist patents, terminate current inter partes review challenges (IPR2025-00267), and explore collaborative opportunities on future photoresist materials.

The work is intended to span resist formulation, precursor synthesis and development, and possibly ultra-clean MOR-specific filtration along with associated delivery systems needed to ensure these new materials perform for EUV lithography applications.

FEL funding

xLight, a U.S.-based startup that is developing a next-generation light source technology for EUV lithography, has officially received funding from the U.S. government.

This week, the U.S. Department of Commerce and the National Institute of Standards and Technology (NIST) announced the signing of a final award of $150 million in federal incentives to xLight under the CHIPS and Science Act.

The deal was expected. These incentives are for the construction and demonstration of a free-electron laser (FEL) prototype, an alternative light source designed to redefine the limits of EUV lithography. This award will support prototype construction at the Albany Nanotech Complex in New York.

Still in R&D, xLight’s technology is designed to generate EUV light in an FEL-driven particle accelerator. xLight’s EUV FEL light source produces 4x more power than today’s systems. Basically, an FEL is a high-power light source, which uses electrons to produce light at different wavelengths.

Mask trends

Mike Hadsell, executive officer and COO of Tekscend, talks about IPOs, EUV and ArF mask equipment investments, AI and curvilinear trends, as well as offers career advice in a wide-ranging interview with Aki Fujimura, CEO of D2S.

Mid-year forecasts—chips, memory, EUV

Believe it or not, we are heading towards the second half of 2026. So, it’s time to look at the mid-year growth forecasts for semiconductors and wafer fab equipment (WFE). It’s also time to look at the future capacity and shipment forecasts for ASML’s EUV lithography tools.

Here are the latest forecasts:

Semiconductors

Thanks to AI, the semiconductor industry is experiencing an unprecedent boom cycle.

In 2025, global semiconductor sales reached $795.6 billion, representing an increase of 26.2% over 2024, according to the World Semiconductor Trade Statistics (WSTS) organization.

Now, in its new forecast, the WSTS has raised its outlook for the semiconductor industry in both 2026 and 2027. The global semiconductor market is now projected to grow by a whopping 90% in 2026, reaching $1.51 trillion, according to the WSTS.

In its previous forecast, the WSTS predicted that the global semiconductor market would grow by more than 25% in 2026, reaching $975 billion.

The new 2026 forecast reflects the ongoing boom cycle in the AI market. The AI-related chip markets, such as accelerators, GPUs, processors and memory, are all seeing huge growth.

In 2026, the sharp upward acceleration is expected to be driven by the memory segment, which is forecast to surge by around 250% year-over-year, reaching more than $800 billion, according to the WSTS.

“Logic is expected to remain another major contributor, growing 37% in 2026,” according to the WSTS. “Other product categories are forecast to expand at more moderate rates, reflecting a broader industry growth: Microprocessors-20%, Analog-10%, Discrete Semiconductors-8%, Sensors and Optoelectronics with 3%.”

For 2027, WSTS forecasts the global semiconductor market to grow a further 27%, reaching approximately $1.9 trillion.

Memory

Suppliers of DRAMs, high bandwidth memory (HBM) and NAND flash memory are seeing enormous demand in the market. In fact, there are shortages of these products in the market, causing a spike in prices.

“The shift in AI development from large-scale model training toward inference-centric Agentic AI applications is driving a structural expansion in memory demand,” according to TrendForce. “With the resulting supply deficit unlikely to be resolved in the short term, prices are set to rise further.”

TrendForce, a research firm, has raised its global memory market forecasts, increasing its 2026 estimate from $551.6 billion in the previous report to $889.3 billion. Meanwhile, the 2027 forecast has been revised upward from $842.7 billion to more than $1.28 trillion, representing annual growth of approximately 44% (See chart below for DRAM and NAND forecasts).

Fab equipment

Fueled by AI and other markets, suppliers of semiconductor equipment have also seen robust demand.

In total, the wafer fab equipment (WFE) market reached $109.7 billion in 2025, up 10% over 2024, according to TD Cowen. Then, not long ago, TD Cowen projected that the WFE market would reach $136.6 billion in 2026, up 24% over 2025.

What’s next? “We think the buy-side view is that WFE grows from approximately $140 billion-plus this year to $180-200 billion in 2027 and potentially $200-230 billion in 2028,” said Krish Sankar, an analyst at TD Cowen, in a research note. “Management teams have not explicitly blessed these numbers, but (in general) did not push back on next year. There is a clear level of optimism, particularly from LRCX and AMAT regarding the WFE opportunity over the next few years.”

Nonetheless, here are some other data points for 2026:

“Front-end semicaps are raising pricing driven by component cost increases and value pricing. What seems different this time, is that the customers are not pushing back, given the strong demand for equipment,” Sankar said.

“We do not expect TSMC to raise WFE-related capex this year due to clean room restrictions at Fab 18 (P8) for N3 and tool availability,” Sankar said.

As reported, TSMC is seeing strong demand for its foundry services. In fact, the Taiwanese foundry giant is struggling to keep up with demand at the 3nm node.

EUV tools

Back in April, ASML posted robust results for the first quarter of 2026. At the time, the Dutch-based lithography giant raised its revenue growth outlook for 2026.

“The bullish view for ASML was not about this print specifically, but rather a multi-year increase in EUV-to-WFE intensity in both DRAM and leading-edge logic after two years of decline and we think that thesis remains intact,” Sankar said in a report.

Given that EUV intensity is back on track, there is a pressing question here: Does ASML have enough manufacturing capacity in place to meet demand for its EUV tools?

In 2026, ASML will have the capacity in place to build and ship 63 EUV tools, including 58 low-NA (0.33) systems and 5 high-NA products, according to TD Cowen. Then, to meet demand in 2027, ASML will have the capacity in place to build 81 EUV tools next year, including 75 low-NA systems and 6 high-NA systems, according to TD Cowen.

Let’s say the AI market remains robust. And let’s say WFE hits $220 billion in 2028. How many EUV tools are required to meet demand in 2028?

“Management highlighted +80 units next year, but to get to +$220B in 2028, we estimate it requires +90 EUV unit capacity,” Sankar said in a new report.