These are the most-read DIGITIMES Asia stories from the week of March 10 – March 15.
China's EUV breakthrough: Huawei, SMIC reportedly advancing LDP lithography, eye 3Q25 trial, 2026 rollout
China is making significant strides in extreme ultraviolet (EUV) lithography with the development of a domestic EUV system, currently being tested at Huawei's Dongguan facility. Trial production is set for the third quarter of 2025, with mass production planned for 2026. China's system uses laser-induced discharge plasma (LDP) technology, an alternative to ASML's laser-produced plasma (LPP).
Experts, including a researcher from TSMC, believe that China's LDP method could be more efficient than ASML's technology. Due to US export restrictions, China has been unable to access ASML's EUV machines and has had to rely on older lithography methods instead. If China successfully commercializes LDP-based EUV, it could bypass Western restrictions and reduce dependency on foreign suppliers. Key challenges include achieving sufficient power output (from 50-100W to 250W), manufacturing high-precision optical components, and integrating the technology into mass production.
Huawei and SMIC are leading the adoption efforts, but scaling EUV production will take time. If successful, China could become the only country outside the Netherlands with EUV capabilities, potentially disrupting the semiconductor industry. However, geopolitical tensions and further export controls could slow progress. By 2030, if China advances to 3nm or 2nm chip production, it may emerge as a major competitor to ASML, TSMC, and Samsung.
China lawmaker proposes anonymous semiconductor purchases to evade US export controls
A Chinese lawmaker has proposed a policy that allows blacklisted domestic firms to secretly acquire foreign semiconductor technology and components, aiming to circumvent US export controls. The proposal suggests replacing public tenders with private transactions to protect overseas suppliers from US scrutiny.
Wen-Hui Guan, an engineer at Naura Technology Group, presented the idea at the National People's Congress (NPC), arguing that transparency requirements expose suppliers to sanctions and contract terminations. He emphasized that increasing US restrictions, such as bans on Nvidia's AI chips, are hindering China's semiconductor and AI sectors.
Chinese firms have already been using intermediaries and loopholes to acquire restricted technology. While Guan's proposal could shape policy, it remains under government review.
Analysts note that this reflects China's growing opacity in tech procurement, making it harder to assess its semiconductor progress. With US- China tech tensions escalating, China's ability to secure advanced technology will be crucial for its semiconductor industry and overall economic trajectory.
Lithography tools viewed as final piece for China's semiconductor equipment supply chain
Naura has been expanding its semiconductor equipment portfolio since 2015, aiming to establish a comprehensive domestic supply chain in China. While it has made significant progress in front-end and back-end semiconductor processes, the lack of advanced lithography machines remains a critical gap. Its recent investment in Kingsemi, a company specializing in lithography-related coatings and equipment, highlights China's push for self-sufficiency in chip production.
Despite advancements in coating, etching, and thin-film deposition, China still lags behind global leaders in lithography technology. The country's lithography efforts are spearheaded by Shanghai Micro Electronics Equipment (SMEE), particularly in the 28nm process nodes, but progress remains slow.
Naura's investment strategy suggests a long-term plan to strengthen domestic semiconductor manufacturing. By focusing on lithography-related equipment, it may gradually move toward developing lithography machines, helping China reduce its reliance on foreign technology.
Analysis: Intel's new CEO should merge Intel Foundry with GF to challenge TSMC's reign
Intel may be considering spinning off its foundry business to GlobalFoundries, following a strategy similar to AMD under Lisa Su, according to a former TSMC executive. This move could create a strong US-based chipmaking competitor to TSMC.
Lip-Bu Tan, a semiconductor industry veteran, will take over as Intel's CEO on March 18, 2025. His appointment has fueled speculation about Intel's direction, particularly regarding Intel Foundry Services (IFS). Some reports suggest Intel is exploring joint ventures, while others propose a merger with GlobalFoundries to strengthen US semiconductor manufacturing.
M.S. Lin, a former TSMC executive, argues that merging IFS with GlobalFoundries would allow Intel to focus on chip design while creating a competitive US-based foundry. Lin also speculates that Tan's M&A expertise and potential collaboration with Broadcom CEO Hock Tan could reshape the US semiconductor landscape.
There are concerns regarding TSMC's acquisition of Intel's foundry due to potential antitrust risks and management challenges. Instead, a US-led restructuring of Intel's foundry business could help strengthen domestic semiconductor production amidst increasing geopolitical tensions. Tan's strong connections to the semiconductor industry, including previous investments in Taiwan and China, add complexity to his leadership. His prior involvement with Chinese semiconductor firms has attracted scrutiny from the US, highlighting the geopolitical stakes involved in Intel's next strategic move.
NAND supply to fall short in 2H25, says Kioxia
Kioxia, a leading NAND flash manufacturer, expects overall NAND shipments to increase by 10-15% in 2025 despite weak demand for mobile phones and PCs. The company anticipates a potential supply shortage in the latter half of the year due to rising AI server demand. Kioxia is not planning major production cuts and aims to align its output growth with market demand. The enterprise storage market remains strong, driven by AI technologies like ChatGPT and DeepSeek, increasing the need for high-capacity, high-density, and low-power storage.
The company is currently producing 112-layer NAND and will begin mass production of 218-layer BiCS8 NAND in 2025, with 332-layer BiCS10 NAND expected to follow in 2026. Kioxia is also focusing on QLC NAND to optimize storage efficiency for AI-driven workloads. A rebound in NAND demand is expected in late 2025 as consumer inventories stabilize and enterprise storage needs grow, particularly in AI and automotive applications. Kioxia is also advancing its NAND roadmap, with PCIe 6.0 samples arriving in 2025 and PCIe 7.0 expected in 2028.
Intel's Panther Lake breaks cover: first public look at 18A-powered core ultra chips
Intel unveiled its Panther Lake processor at Embedded World 2025, marking the first public demonstration of its next-generation Core Ultra 300H/U series, which is built on the Intel 18A process. Featuring a hybrid architecture with 16 cores (4 P-cores, 8 E-cores, 4 LPE cores) and 12 Xe2 GPU cores, Panther Lake boasts 180 TOPS of AI compute power, enhancing Intel's competitiveness in AI-driven computing. As part of Intel's "Five Nodes in Four Years" (5N4Y) strategy, the 18A process introduces Gate-All-Around (GAA) transistor technology (RibbonFET) and backside power delivery (PowerVia), rivaling TSMC's N2 node in SRAM density. Panther Lake has surpassed Meteor Lake in yield rates at the same stage, signaling strong production progress.
Intel secured US$3 billion from the CHIPS Act to support its semiconductor manufacturing initiatives, with 18A production scheduled for 2025. The Panther Lake-H series will launch first, potentially followed by an HX variant, with consumer devices expected in early 2026. This launch is pivotal for Intel's IDM 2.0 strategy, positioning the company to strengthen its PC market presence and expand its foundry ambitions in competition with TSMC.
Naura ranks 6th among global semiconductor equipment providers despite US-China tensions
Naura has risen from tenth to sixth place globally in semiconductor equipment rankings, reflecting China's push for self-sufficiency amid US sanctions. With China prioritizing self-sufficiency, foundries like SMIC, Hua Hong, and YMTC are integrating more Chinese-made equipment into their production lines. While Chinese manufacturers still lag behind international firms in advanced processes like 7nm, continuous improvements are narrowing the gap.
Foreign companies face challenges due to US restrictions, limiting their ability to service Chinese clients. ASML, which generated over US$11 billion from China in 2024, faced scrutiny for expanding its repair facility in Beijing. Industry experts expect Chinese semiconductor equipment firms to further strengthen their global position as China's chip industry grows despite geopolitical tensions.
Article edited by Jerry Chen
