Apple Intel Talk Cooperation; ASML to Receive Up to 4.6 Billion Euros in Equipment Orders. Will ASML Become the Biggest Beneficiary of the Chip Boom?

TradingKey - Earlier this month, Apple (AAPL) and Intel (INTC) reached a preliminary agreement for Intel to provide foundry services for some of the chips used in Apple devices. Bank of America noted in its latest analysis that this partnership could be worth as much as $10 billion, and the primary beneficiaries may be the Dutch semiconductor equipment giant ASML and semiconductor packaging equipment manufacturer BE Semiconductor (commonly known as Besi).

Intel Capacity Expansion Benefits ASML and Besi

BofA stated that this partnership will increase Intel's procurement of chipmaking equipment, primarily involving two companies, ASML and Besi.

ASML is not only the world's leading semiconductor equipment manufacturer but also the sole producer utilizing EUV (Extreme Ultraviolet) lithography technology. The company's product portfolio includes DUV (Deep Ultraviolet) lithography systems, EUV lithography systems, and next-generation High-NA (High Numerical Aperture) EUV systems. Nearly every chipmaking giant requires lithography equipment from ASML.

Besi is a leader in the field of hybrid bonding equipment, whose tools are primarily used in high-end packaging technologies and are widely adopted by semiconductor manufacturers.

According to Bank of America (BAC) estimates, if the collaboration between Intel and Apple covers the iPhone product line, Intel's equipment orders for ASML could reach up to 4.6 billion euros, and its order volume for BE Semiconductor’s hybrid bonding machines could far exceed previous expectations, reaching 182 units, thereby creating a substantial tailwind for the outlook of these two companies.

Bank of America's forecast is divided into two scenarios: in the base case, where the foundry partnership between Apple and Intel does not include the iPhone, Intel's orders for ASML are expected to be approximately 1.8 billion euros. However, if the iPhone is included in the scope of cooperation, Intel's order demand for ASML would increase to 4.6 billion euros, equivalent to Intel needing to purchase 15 EUV lithography systems.

The same logic applies to equipment demand for Besi. According to BofA's projections, in the base case, Intel's order volume for its hybrid bonding machines is approximately 15 units; if the foundry scope includes the iPhone, demand will surge to 182 units, significantly higher than Intel's original forecast of purchasing 80 units between 2024 and 2030.

Will ASML Become the Ultimate Winner of the Chip Boom?

Whether it is the chip foundry partnership between Apple and Intel or the growing demand for chips from other manufacturers, capital will eventually flow to ASML because of its monopoly in the lithography sector. Based on forecasts of a persistent chip shortage, ASML expects to mass-produce at least 60 EUV lithography machines this year, a significant increase from 2025 levels, with annual production capacity expected to further rise to at least 80 units in the next phase.

But that does not mean ASML is without risk. In April of this year, TSMC (TSM) publicly stated that it has no current plans to purchase ASML's latest High-NA EUV lithography machines because the price is too high. TSMC is ASML's largest customer, and its purchasing decisions are critical to ASML achieving its revenue targets; furthermore, TSMC's refusal to buy could mean that ASML's commercialization process, which originally projected mass production of High-NA EUV in 2027-2028, has been hindered.

In response, ASML CEO Christophe Fouquet stated that although this equipment is more expensive, its manufacturing cost per wafer for advanced processes is actually lower, achieving a 20%-30% cost reduction. As the overall cost of large-scale chip production is more advantageous, the purchasing intentions of major chip manufacturers may shift in the future.

Why has ASML underperformed Micron and Intel? Is there still upside for ASML?

Since the start of the year, major chipmakers have posted staggering gains as the semiconductor sector has become a market focal point. In terms of memory chips, Micron (MU) is up more than 150% year-to-date (YTD), while Samsung Electronics in the Korean market has gained 117% and SK Hynix has surged 171%. In chip manufacturing, Intel has climbed 228% YTD, AMD is up 105%. In comparison, ASML’s 46% YTD gain in the US market is notably lagging.

The primary reason may be that the gains in the semiconductor sector have not yet trickled down to ASML. The aforementioned companies have directly benefited from an acute shortage of memory and computing chips, whereas ASML sells manufacturing tools; only when chipmakers generate profits and convert them into capital expenditures will they likely increase procurement from ASML. This demand transmission typically lags by several quarters.

Nonetheless, given ASML's monopolistic position and its upward revision of 2026 growth guidance, the market can remain confident in ASML's growth prospects.