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Applied Materials Tightens Grip on AI Chipmaking With TSMC Partnership and NEXX Buy

The expanded toolset targets equipment bottlenecks that slow production of larger, more efficient AI accelerators.

Overview

  • Applied Materials and TSMC launched a collaboration at the company’s EPIC research center in Silicon Valley to speed new materials, tools, and processes from the lab into high‑volume chip production.
  • Applied Materials acquired ASMPT’s NEXX unit to add electrochemical deposition used in panel‑level advanced packaging, which helps build larger AI accelerators that use less power.
  • Citi raised its price target on AMAT to $520, citing a multi‑year jump in wafer fab equipment spending, the tools chipmakers buy to build advanced factories.
  • The Citi note flagged Tesla’s proposed Terafab as a possible extra source of equipment demand, which remains unmodeled and uncertain on timing.
  • Tight supplies of chipmaking machines are lifting sector demand, and Applied says it has nearly doubled system output to keep up as AI workloads drive orders.