Intel Is Investing $4.1 Billion In This Dutch Chip Maker To Make Smaller, Faster Chips

Intel COO Brian KrzanichIntel COO Brian Krzanich

Photo: Intel

Intel announced today a whopping  $4.1 billion investment into a Dutch semiconductor equipment company, ASML. ASML is developing two new technologies that will make more powerful chips.Those technologies are called extreme ultra-violet (EUV) lithography and 450-millimetre wafers and they will let Intel make smaller chips that drink less power.  In other words, Intel is spending $4.1 billion to continue with Moore’s Law, which tries to double the density of chips on a wafer every two years.

Some physicists say we are reaching an end to Moore’s Law — that doubling capacity cannot go on forever. Intel’s clearly doesn’t buy that.

The full deal will take place over five years, and includes Intel nabbing a 15 per cent stake in ASML as well as dumping $3.3 billion into ASML’s R&D programs.

Buying a stake in ASML doesn’t give Intel any special or preferential access to ASML’s new chip manufacturiing technologies ahead of other chip makers, explained Intel COO Brian Krzanich on an analyst conference call today. But Intel has been pursuing both of these technologies already. So by investing in a company that makes the equipment, it will be able to push these new chips to market way faster, perhaps two years faster.

Krzanich also said that Intel recently made an undisclosed investment one of ASML’s competitors, too — although the deal wasn’t nearly as big. So when this new technology comes to market, Intel will have multiple suppliers.

NOW WATCH: Tech Insider videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.

Tagged In

intel sai-us