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Let's get to Paris, Back to France where Opening Trade co host Tom McKenzie is standing by with the CEO of ASML at the Viva Tech conference.
Time take it away, Matt.
Yes, the CEO of Europe's most valuable company, a SML that plays that central role, of course in the semiconductor.
Space, Christoph Fouque.
Christoph, we are meeting and talking at a moment where there is a lot of focus here in Europe on the decision by the US to impose export controls on anthropic models, and Europe is feeling the impact of that, and it's a reminder of the questions around sovereignty, particularly around AI. And you are pushing hard on this. What is your message to Brussels. What is it that Europe needs to do to ensure that it is not vulnerable to those kind of supply chain risks.
Well, I think in did a lot of discussion around that, and sovereignty has become a key ward because popore realize that strategically, if you don't have a big enough part of a certain ecosystem in this case AI, you're going to be exposed to the goodwill of other parties. But I think what's very important to understand when it comes to sovereignty is to get sovereignty, you need innovation first. You have to do things in the right order. It's
not enough to say I want sovereignty. What's very important is make sure that innovation can happen in Europe.
And I think that's a bit.
The idea of the Tech Creators Group we have created where we believe that it is very very important to have a dialogue with the different government commission but also national government to have helped them to understand how to create the condition such that the AI ecosystem can develop in Europe.
You will never have the entire.
Ecosystem, but you cannot do it all it's too much or you cannot do it all at the same time. But you need at least to have enough off I would say skin in the game in a value in the coosystems, so that when those discussion on those this shion happen, you have a pos.
So where can Europe have skin in the game. They've got skinn in the game with ASML and the role that you play. Yeah, where else can you have skin in the game when it comes to AI.
Well, I think a very important place is the market itself. The Europe and market is pretty attractive, right you look at twenty two percent of GDP, it's a very I would say match your market, very good market. So this means we are user, we are buying a lot of stuff, and that's to start with a strength for Europe, and I think that's the reason why Europe was created. Now, if you look at the other part between maybe ASML and that, we have a lot of horse and sometimes
we discuss a lot semiconduct and manufacturing. Yes there is a gap there, but most probably not the right place to start because semiconcter manufacturing is only needed if you have people to buy a semiconductor. Today, if we are the tunanometer of fab in Europe, most probably most of the wafers will go to the US.
So since we have a strong.
Market, we have to start by looking at that and focus on what we call the market demand product and have strong industrial projects around AI application, around maybe AI products then maybe are cheap design and then chip manufacturing. But you have to look at the entire sequence and look at it in the right holder.
How would you score Europe right now on a score of one to ten in this AI.
Race, Well, I think I've said that before.
I think that you know, if we compare how we do on the entire ecosystem versus the US and China, I think today the US is the clear winners.
I mean they are.
Looking at champion across the entire AI SUMI ecosystem. I think the one place they were missing a bit out was manufacturing, and I think they have been extremely aggressive in bringing some key company to manufacture in the US.
They can do that because they buy chips.
Eighty percent of the advanced chips manufacturer worldwide is bought by the United State. So I think the US is doing very very well. China has been investing or so across the entire ecosystem. I think mostly they do very well on the application side, a bit less on what's before that, but I think they are driving the use
of AI mostly more aggressively than any other country. And again, when you look at Europe, a lot of horse so I would say, you know, how family quite behind what's happening elsewhere today, So.
That gap is obviously there. How interventionists should European governments be? The US taking a ten percent stake in Intel. Is that a playbook that we should copy?
Well, I think two things.
Maybe, so think we need to have a dialogue between the industry and government, the commission.
Viewers.
Compared to what's happening in the US or in China, this has been missing and I think the responsibility.
All right, it looks like we are losing the feed there, which is always how it goes at a tech conference. The Wi Fi doesn't work in any case. We'll get back to Bloomberg's Tom mackenzie and the CEE of ASML as soon as we can recover that at the Viva Tech Paris conference. Okay, apparently they're talking again, so we'll see if the tech holds up.
The goal of government is to really develop instruments regulation or lack of regulation in some cases, to make the industry champion life a lot easier.
I want to ask you about the IPOs that come through SpaceX, notably and possibly open aanthropic coming up into the future. Are we underestimating the CAPEX spends that could come about as a result of that capital raising and what it means for the demand for your lithography machines.
Well, if you look at you know, worldwide, the demand for AI infrastructure is still enormous and the demand for AGI H compute start to come up, so the demand is continuing to go up. I think a lot of US are convinced that we're going to be looking at the supply limited market for AI pos semiconductor for quite a few years because the build up of the infrastructure is huge, and I think some of the IPO you mentioned are just pointing to the opportunity that they is a present.
We are we early in this Still, where are we in that? In US?
Sequential early?
Because you know, even a year ago, the AI company, we're already very vocal about the need for this architecture, the need to build capacity. My industry, the semi industry was still a bit exitant to move. And the move really happened basically at the end of last year and very quickly. And now we all need to build capacity.
So our customer have to build fab We have to make sure we build enough equipment to fill those fab Yeah, and a catch up will take quite a bit and that's only for the infrastructure, and then the application will come.
Are using a pull forward of also TVV machines from customers.
We see a pool, we see customer continuing to create visibility, longer term visibility telling us well, this is a bit here to stay. So I would say that the trend we see is still very strong towards basically demand.
Run with me on this one, data centers in space. Is there a potential additional revenue stream for ASML? If Musk pulls that one.
Off, well, I think you know, yes, you need a certain amount of data center and they will be in space, they will be on the hearst, doesn't necessarily change a number. I think the discussion about data center in space is to maybe address another potential bottomleck in the ecosystem, which is energy. I think the discussion around putting data center in space is there because there is an idea that if you do that, the energy consumption or the energy
availability will be there. So maybe not too much to do with, you know, the total data center capacity, but maybe more about trying to solve another potential big issue, which is energy for a data center.
Elomsk is also looking at a terror fab potentially one terrawat of power. What's the potential upside for a SML on that. Have you talked to Usk about that? Project.
Is that a potential uplift as well for the business going forward?
Well, you know, you know, any added capacity of of course a potential upside for for us. I think we are looking very carefully on the development on when things will happen at wet speed. You know, new projects are opportunity as long as you're not supply limited. So that's also important to say that. So we have to make sure that this is really being taken care But I think the Terra fab is an example of a major
fab project. If you look at some of the DRAM project in Korea, you also look at million of way for fabs, so that's also pretty big.
Okay, So career and the build out there is going to be a driver as well. Staying with the US though that one of the top House Republicans on the House China Committee sent a letter in April suggesting that SML was going to start shipping DUV lithography machines into China.
They have some concern there. Do you do you have a response to that.
No, it's not a response because you know, we have a dialogue with every government. I think you know that in the last few we have been subject many many times to those kind of negative rumors about what we do. I mean every time, the rumors have been quite I would say, potentially hurtful even for SML.
And I want to say it again.
I mean, we have been following every single rules and we continue to do that. The wad are changing, by the way quite often, and sometimes something you could do you cannot do anymore. But when this happened, you know, we change our behavior accordingly.
So we are.
Extremely cautious in trying to follow or follow basically the whole of flaws.
It's very important.
And that's true for DPUV, that's true for EUV, that's true for any activity we have in China or anywhere else in the world. And I can promise you there's a lot of people in SML making sure that we comply. Compliance is a very important I would say, elements in a very difficult geopolitical environment.
The Indian Prime Minister narendro Romoti will be here in Paris tomorrow. Yes, you've partnered with Tatar on their aspirations around boundaries and build out a semiconduct capacitated. How much of a growth story potentially is India for AIRS?
And yeah, so I think So first, we're very happy with this partnership because we are partnering at the very start, at the very beginning. So of course we all know that India today doesn't have manufacturing for the mechanic tur but you know, by twenty thirty they believe that ten percent of any chips will be used by India and like anyone else, that become therefore a strategic equation of supply and therefore they want to get their factory. So
first five will come up next year. A lot of learning has to happen and we will help India Tata through this partnership to acce read a learning and you know, as learning gets successful, you go to the opportunity. So we're very happy to start now because we look at that as a growing opportunity for not in the next two years, but for the next five and ten years in India, and we're very happy that we are there.
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