What is EUV Lithography and why is it important?
EUVL is a leading-edge manufacturing technique within the semiconductor industry that has been in R&D for at least the past decade. However, it is only recently that the technology has been ready for mass production and is now more frequently embedded in advanced semiconductor manufacturing. The goal in semiconductor chip manufacturing is “process shrink” — to increasingly miniaturize the building blocks of the computer chip (integrated circuits) — to allow denser patterns to be etched into semiconductor materials. In the manufacturing process, a laser is used to create the complex circuit patterns on the chip. Like a sharper knife, the shorter the wavelength of the laser, the more precise circuits can be made and the tighter they can be packed together. Until EUVL, the most advanced commercial process used a 193-nanometer wavelength light. EUVL uses a 13.5-nanometer wavelength light, 1/14th the length of the previous technology.1
After years of significant refinement and testing, EUVL has achieved the manufacturing yields required to be deployed by semiconductor chip manufacturers. The resulting chips are able to be up to 40% more area efficient, to increase performance by up to 20% and to reduce power consumption by up to 50% compared to recent predecessors.2 In the next two years, it is estimated that leading manufacturers will use this technology to reach a 5-nanometer standard, just twice the size of a strand of DNA.3
We believe this innovation greatly lengthens the runway for Moore’s Law and offers a bright future for chip development. We think enhancing computing capability and storage capacity while lowering both power consumption and costs will provide a substantial tailwind for tech progress.
Notably, however, EUVL requires specialized technology in the form of huge machines that are expensive, complex, and in limited supply. Instead of being a limitation, we think this presents some compelling investment opportunities.