Nikon Declares a Price War on ASML: Inside CEO Yasuhiro Ohmura's Plan to Fight for DUV Lithography Survival

The Strategy: Undercutting ASML on Price with In-House Precision

The core of Ohmura's plan is deceptively simple: leverage Nikon's vertically integrated manufacturing to sell lithography equipment cheaper than ASML. In an interview with Nikkei Asia, Ohmura stated bluntly, "We can fight a price war. Even if we lower prices, we can still secure decent profits" .

That confidence stems from Nikon's ability to produce many of its own components, most critically its optical lenses. Unlike ASML, which relies on a complex web of external suppliers (including Carl Zeiss for its EUV optics), Nikon builds its lens systems internally. This structural cost advantage means that even at 20–30% lower price points, Nikon can maintain margins that make the business viable . For a chipmaker looking to equip a new fabrication plant, that discount could represent tens of millions of dollars in capital expenditure savings per tool .

The pricing strategy is being deployed alongside a product roadmap designed to minimize switching costs for customers already invested in ASML's ecosystem. Nikon is developing a new ArF immersion system explicitly designed to be compatible with ASML's platforms, targeting a prototype delivery to a major semiconductor manufacturer by 2027 . Simultaneously, the company plans its first commercial shipment of a next-generation dry ArF system, the NSR-S333F, within fiscal year 2026 .

Nikon says negotiations with major US and Asian chipmakers are "close to securing" purchase orders, signaling that the price message is landing with customers who are increasingly cost-sensitive and eager to avoid single-supplier dependency in their supply chains .

Why Now? The Desperation and the Opening

Ohmura's price war is not born purely from ambition. It is a survival response to four intersecting pressures.

The Intel Overconcentration Problem. Nikon's lithography business has been dangerously dependent on a single anchor customer: Intel. Ohmura acknowledged the difficulty candidly, stating, "Other than Intel, we lack sufficient performance records, and our support capabilities have not yet won market trust" . Without a broader customer base, Nikon's lithography division has been shrinking into irrelevance. In the six months ending March 2026, Nikon shipped just 9 lithography machines—all of them older-generation systems for mature manufacturing nodes. By contrast, ASML sold 327 systems in 2025, including 48 high-end EUV tools .

A Historic Financial Crisis. Nikon's recent loss warning of ¥850 billion is the most severe in the company's 100-plus-year history . The imaging division faces its own structural decline, and management is betting that the precision equipment business—anchored by lithography—can power a turnaround. Ohmura's new Medium-Term Management Plan, running from April 2026 to March 2031, explicitly ties the company's recovery to regaining relevance in semiconductor equipment .

The China Export Control Gap. Dutch trade restrictions implemented in 2024 prohibit ASML from shipping its advanced NXT:2050i and NXT:2100i immersion systems to China without an export license. The effect is already visible in ASML's revenue mix: China dropped from 33% of sales in 2024 to a projected 20% in 2026 . This retreat leaves a significant portion of the world's largest semiconductor market underserved for advanced DUV tools. Nikon, which is not subject to the same export restraints, can position its lower-priced ArF systems as an accessible alternative for Chinese fabs expanding mature and mid-range node capacity.

The Ecosystem Compatibility Play. Historically, one of the greatest barriers for Nikon was the switching cost for fabs built around ASML's process recipes and service infrastructure. By designing its new immersion platform to be compatible with ASML's ecosystem, Nikon is removing a critical objection from the procurement conversation. If a foundry can plug a Nikon tool into an existing ASML-dominated production line without re-engineering its entire process, the price discount becomes significantly more compelling .

The Financial Mismatch: Nikon vs. ASML by the Numbers

The scale difference between the two companies makes clear that this is not a clash of equals. ASML's financial trajectory is defined by near-total control of the most valuable segment of lithography, while Nikon is fighting for scraps at the mature end of the market.

ASML's fortress. In its 2025 fiscal year, ASML reported total net sales of €32.7 billion with a gross margin of 52.8% and net income of €9.6 billion . The company's EUV backlog alone reached €38.8 billion by the end of 2025, providing multi-year revenue visibility that no competitor can match .

In April 2026, ASML raised its full-year 2026 revenue guidance to a range of €36 billion to €40 billion, implying top-line growth of 10–22% . The first quarter of 2026 alone generated €8.8 billion in net sales with a 53% gross margin . Looking further out, ASML's Investor Day targets point to a 2030 annual revenue range of €44 billion to €60 billion with gross margins between 56% and 60% .

The company's competitive moat is technological, not just financial. Its High-NA EUV platform (Twinscan EXE:5200) remains the sole lithography technology capable of producing chips at 2nm and below, which are essential for next-generation AI accelerators and quantum computing components . ASML employs over 42,000 specialists and maintains an exclusive supply chain for the mirrors, light sources, and vacuum systems required for EUV production. No competitor possesses anything approaching this capability .

Nikon's reality. Nikon's revised revenue forecast for its fiscal period reflects the stark gap. The company cut its full-year projection by ¥25 billion to ¥725 billion (approximately $5 billion), and the lithography division accounts for only a fraction of that total . Gross margin data for Nikon's equipment business is not publicly broken out in a directly comparable way, but the company's overall financial position—a projected record loss—indicates that profit margins are thin or negative at current volumes .

What the Price War Can (and Cannot) Achieve

Nikon's ArF immersion offensive is best understood as a targeted survival play, not a credible assault on ASML's dominance.

The strategy can succeed in carving out a niche. If Nikon wins even a handful of orders from major Asian and US chipmakers at its discounted prices, it could stabilize its lithography unit, build a performance track record beyond Intel, and demonstrate to the market that it remains a viable second source for mature-node equipment. The China opportunity, in particular, offers a natural demand pool that ASML is increasingly restricted from serving fully.

What the price war cannot do is threaten ASML's core business. The EUV monopoly is protected by decades of R&D investment, proprietary supplier relationships, and customer co-investment from Intel, TSMC, and Samsung . ASML's EUV tools sell for $150 million to $350 million each, and demand is driven by process roadmaps that Nikon simply cannot serve . Even if Nikon captured 100% of the ArF immersion market—an implausible scenario—it would still represent a small fraction of ASML's total revenue base because the profit pools are concentrated in the EUV segment.

Ohmura's own language reflects this realism. He does not claim Nikon will overtake ASML. He claims Nikon can survive, diversify, and earn a decent profit at lower price points. For a company that once dominated the global lithography industry and has since watched its share evaporate over two decades, that qualifies as an ambitious comeback. But for ASML, it is a distant noise from a competitor fighting in a different weight class entirely.