Supply Signal
The Tools Behind Your 2027 Supply Are Running Short.
By Supply Signal | October 19, 2026 | 6 min read
The tools that will make your 2027 parts are running short, and one chip company is securing foundry capacity that its foundry still has to expand.
This week, ASML, which builds the lithography systems that print advanced chips, said it now expects its supply as currently planned for 2027 and 2028 will not fully meet customer demand. Some of its customers are already interested in ordering for 2029 and 2030.
The same week, Semtech agreed to invest in securing dedicated capacity at its foundry, and an inspection-tool maker reported orders with deliveries into 2027. Some of the tools and foundry capacity that will make parts in 2027 are already being ordered or reserved.
For a commodity manager, one question now matters for each critical part: whose capacity does your 2027 volume run on, and is any of it already reserved for someone else?
The Tools for 2027 and 2028 Will Not Cover Demand
If a supplier's 2027 growth depends on new lithography tools, treat that growth as at risk until the supplier gives you a ship date for the tools. ASML said this week that it now expects its supply as currently planned for both 2027 and 2028 will not fully meet the demand of its customers. Customers keep raising their equipment forecasts, and ASML says their views on the size and duration of AI investment are the main driver.
The plan was already a 30% increase. ASML had planned to raise its low-NA EUV and DUV immersion capacity by that much in 2027.
EE Times puts the base at about 65 low-NA EUV systems and about 130 DUV immersion systems in 2026.
ASML is now investigating ways to add capacity for 2028 beyond the further 30% it had under study. Some customers are expressing interest in placing orders for 2029 and even 2030.
Ask first about output from tools already installed. ASML says its productivity upgrades continue to add significant wafer capacity for its customers, and EE Times notes that these upgrades add capacity while new equipment moves through production.
Two Narrow Points Behind the Tools
The tool supply has its own narrow points, and a delay at Zeiss can move ASML's delivery dates. EE Times notes that ASML's 2025 annual report names Zeiss's production capacity as a limit on how many lithography systems ASML can build. Zeiss supplies the optical columns, and ASML is its only customer for them. Zeiss has been adding about 25,000 square meters of production and related space at Oberkochen, in stages, since 2022. EE Times reports that Zeiss's July announcement did not quantify the added qualified EUV optical output.
The second narrow point is less visible. In July, China put Sindlhauser Materials, a German coatings firm in ASML's supply chain, on its export-control list. The firm relies almost entirely on Chinese rare earths and critical minerals, and the listing also stops distributors from passing China-origin dual-use items to it.
Tom's Hardware, citing an Oct. 14 Bloomberg report that quotes people familiar with the matter, says the EU is negotiating a swap of delistings with Beijing. The German and Bavarian governments have helped the firm look for workarounds. Tom's says it still faces the risk of going out of business in the coming months if the sanctions remain.
I do not know whether Sindlhauser's coatings have a second source. The case shows that lithography supply can depend on a firm that Tom's Hardware calls "seemingly obscure."
One Supplier Is Securing Dedicated Foundry Capacity
If you buy high-speed analog parts built on silicon germanium, ask your supplier whether your volume runs on reserved capacity or on shared capacity. Semtech agreed this week to invest in securing dedicated silicon germanium capacity at Tower Semiconductor, under an expanded multi-year agreement. The capacity spans Tower's fabs in the United States, Israel and Japan. The parts include transimpedance amplifiers, modulator and laser drivers, and linear equalizers for optical and copper links in AI data centers.
Semtech's chief executive put the mechanism plainly: meeting demand "requires long-term capacity planning and commitment with our manufacturing partners." Semtech names the open risks itself. One is Tower's ability to install equipment and expand silicon germanium capacity "on the anticipated timeline, or at all." Another is whether Semtech fully uses the capacity reserved for it under the agreement.
A reservation does not add a wafer by itself. It decides who gets the wafers when they arrive. A buyer of other silicon germanium parts made in the same fabs should ask how much of the next expansion is already committed.
The New Fab Is Expected in 2029
Keep this week's new U.S. fab out of any plan for 2027 or 2028. GlobalFoundries was selected to operate two new fabs at its Malta, New York, site under a U.S.-Japan initiative of up to $21 billion, with Japan providing the investment.
About $10 billion goes to the first 300mm fab. GlobalFoundries expects it to come online in 2029 and to add about 900,000 wafers a year when fully operational. About another $10 billion would fund a second fab.
GlobalFoundries expects to break ground on the first fab later this year. A construction start is a date for a building, not for your parts.
Renesas says it is planning around the new capacity as an extension of its own production footprint. Cirrus Logic says the fabs give it access to domestic manufacturing for next-generation mixed-signal products. Neither states a volume.
GlobalFoundries gives no date for the silicon photonics, silicon germanium and advanced packaging work at Malta and at Burlington, Vermont. It has agreed to reallocate $955 million of its CHIPS Act award to that work.
More Orders, the Same Calendar
If your parts use advanced nodes or advanced packages, confirm your 2027 allocations in writing now. In SemiWiki's account of TSMC's call, chief executive C.C. Wei said assessed demand exceeds available supply and acknowledged some shortage in backend capacity. SemiWiki also reports that TSMC expects annual capacity for its 2-nanometer family to more than double in 2027. TSMC's own results point the same way: third-quarter revenue came in above the top of its guidance range.
Some inspection tools for packaging lines are already on order, with deliveries running into 2027. Camtek, which makes inspection and metrology tools, has taken orders of over $800 million since January. It ties the orders to demand for advanced packaging for AI, and to customers that continue to expand capacity.
What to Watch For
These are the conditions I am watching for you. The actions in the next section are yours.
- ASML's next quarterly update. Whether it confirms more capacity for 2028, and whether customer interest in 2029 and 2030 turns into booked orders.
- Sindlhauser. China removing the firm from its export-control list, or the firm shutting down.
- Zeiss. A stated figure for added qualified EUV optical output.
- GlobalFoundries at Malta. A ground breaking on the first fab before the end of the year, and a date for the silicon photonics, silicon germanium and packaging work.
- Tower's third-quarter results on November 2. Any statement on silicon germanium capacity added or reserved.
- TSMC's 2-nanometer volume. Whether 2027 capacity more than doubles, and whether the backend shortage reaches packaging lead times.
What To Do This Week
- Ask each supplier of a critical part where its 2027 volume comes from: tools installed today, tools on order with a ship date, or productivity upgrades.
- Ask each supplier of silicon germanium analog parts (transimpedance amplifiers, laser and modulator drivers, linear equalizers) whether your volume runs on capacity reserved for you or on shared capacity, and what a reservation would cost.
- Place 2027 forecasts now with suppliers of parts on advanced nodes or in advanced packages, and ask for the allocation in writing.
- Mark the new Malta fab as 2029 or later in every sourcing plan, and the Malta photonics, silicon germanium and packaging work as undated.
- Add one question to supplier reviews for single-fab parts: does the fab's next expansion depend on new lithography tools, and when do they ship?
- Model total cost of ownership for 2027 with the cost of a capacity commitment included, for each part where a supplier asks for one.
Some of the tools, foundry capacity and inspection systems for 2027 are already being ordered or reserved. The Malta fab that GlobalFoundries expects online in 2029 will not add output in the years these tools are short.
A buyer who waits for new capacity to be announced may find part of it already spoken for. The time to ask whose capacity your parts run on is before your supplier's next customer signs.
Sources: ASML third-quarter 2026 results; EE Times on ASML and Zeiss; Tom's Hardware on the EU, China and Sindlhauser; Tower Semiconductor and Semtech agreement; GlobalFoundries announcement of the Malta fabs; TSMC third-quarter 2026 results and guidance; SemiWiki on the TSMC call; Camtek preliminary third-quarter results; Tower third-quarter results date. The TSMC call statements are SemiWiki's account; company plans and dates are their own expectations.