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The chip shortage is so bad companies are ripping them out of washing machines

ASML chief executive Peter Wennink said that large industrial companies are buying washing machines in order to take the chips out and repurpose them.

An extreme ultraviolet lithography machine
Minor disruptions to chip manufacturing can have a big impact because the supply chain is tight.
Photo: Intel Corporation

Anyone who has tried to buy a car or home appliance lately knows the chip shortage is still pretty bad. But it has become so dire that large industrial companies are buying washing machines in order to rip out the chips and repurpose them, according to ASML CEO Peter Wennink.

“Now, we could say that’s an anecdote,” he said on the company’s earnings call Wednesday. “But to be honest, it happens everywhere — it is 15-, 20-, 25-year-old semiconductor technology that is now being used everywhere.”

Wennink said that internet of things is likely driving the demand for these older chips found inside home appliances.

The Dutch company makes lithography tools that chip giants such as TSMC, Intel, and Samsung use to manufacture their most advanced processors. Wennink has a unique view of the semiconductor supply issues since ASML deals with a wide range of businesses around the world. And business is good: It reported a net profit of €695.3 million ($754.3 million) on sales of €3.53 billion.

ASML itself is struggling to build all of the tools its customers want, and is trying to figure out how to produce just over 700 lithography tools in total every year. Wennink said in the earnings call that he would be happy if he could fulfill 60% of the orders ASML has received this year. According to Bernstein analyst Mark Li, it is likely ASML will struggle to fulfill demand through 2023.

Max A. Cherney

Max A. Cherney is a senior reporter at Protocol covering the semiconductor industry. He has worked for Barron's magazine as a Technology Reporter, and its sister site MarketWatch. He is based in San Francisco.

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