Japan's Semiconductor Equipment Makers, Mapped: The Companies No Chip Fab Can Run Without

When people talk about semiconductors, the spotlight falls on NVIDIA for design and TSMC for manufacturing. But many of the machines that actually coat, etch, clean and test the circuits on those production lines are built by Japanese companies. Japanese equipment makers are deeply embedded in every one of the manufacturing steps covered in our primer on what a semiconductor is (in Japanese). For a bird's-eye view of the industry, see our semiconductor roadmap, and for Japan's broader comeback story, our analysis of Japan's growth strategy for semiconductors (both in Japanese).

Why can no chip be made without Japanese equipment?

The reason is that manufacturing equipment and materials are concentrated in Japan. Japan accounts for roughly 30% of the world's semiconductor manufacturing equipment, second only to the United States. Japan's position in materials is even stronger: about 88% in coating and developing materials, about 53% in silicon wafers, and about 50% in photoresist, the light-sensitive material used to print circuits.

The map below shows which process step each company controls. Click a company to see its process step, global position and revenue.

Which company controls which process step?

Japan's equipment makers are each deeply specialized in a specific step. The table below organizes each company's process step, equipment, global position and revenue.

At the center is Tokyo Electron. On top of deposition, etch and cleaning systems, it holds about 90% of the world market in coater/developers — the machines that coat circuit patterns onto wafers — covering a wide swath of the front end. Revenue for the fiscal year ended March 2025 was about 2.43 trillion yen, a record high (Tokyo Electron).

In the back end, DISCO holds about 70-80% of the world market in grinders and dicers, the machines that thin wafers and cut them into individual chips. In test, Advantest forms a duopoly with America's Teradyne in testers for finished chips, and its revenue is expanding rapidly on AI and HBM test demand — about 1.13 trillion yen for the fiscal year ending March 2026, up 44.7% year on year. Beyond these three, a strong company sits at nearly every step: SCREEN in cleaning, KOKUSAI ELECTRIC in deposition systems that build up films one layer at a time, and Ebara in the polishing step that grinds wafer surfaces flat (Advantest).

What are the weaknesses and risks for Japan's equipment makers?

The biggest weakness is advanced lithography. In this most critical step — printing circuits onto the wafer — the Netherlands' ASML monopolizes EUV and holds about 94% of the overall lithography market (2024). Nikon, once the leader, has retreated from the leading edge and plans a comeback with a new lithography tool in fiscal 2028. Canon, meanwhile, is pursuing a different route to the leading edge with nanoimprint lithography, which does not use light at all (TrendForce).

The other risk is geopolitics. In July 2023, Japan moved in step with the United States and added 23 categories of advanced semiconductor manufacturing equipment to its export licensing regime. Companies with high China revenue exposure — about 38% for Tokyo Electron — are the most sensitive to tighter controls. (Hogan Lovells / METI).

What should investors watch in Japan's equipment makers?

What matters is how irreplaceable each company's process step is, what drives its demand, and its regulatory risk. The checklist below organizes the items to verify and where to find them.

In particular, Advantest tracks AI and HBM test demand, while Tokyo Electron and DISCO track AI chip production and back-end demand. On the other side of the ledger, China revenue exposure, the direction of export controls, and the structural weakness in advanced lithography are must-check items. This article is not investment advice.

What should you watch next?

The things to watch: how far the AI chip buildout pushes equipment demand, whether export controls on China tighten further, and whether Canon's nanoimprint or Nikon's new lithography tool can win back a presence at the leading edge. Look at semiconductors through the lens of equipment and materials, and the Japanese companies behind the headlines come into focus. For the underlying technology, see what a semiconductor is; for the industry structure, see how the semiconductor value chain works (both in Japanese).