International Business Machines (IBM) is doubling down on the semiconductor frontier, not by constructing fabs, but by controlling the technology that other companies will require to make the next generation of chips.
Big Blue signed a new cooperative research agreement with Japan’s SCREEN Semiconductor Solutions to collaborate on developing cleaning procedures for High-NA (High Numerical Aperture) intense ultraviolet lithography. This is the advanced patterning technology required to make chips that are less than 2 nanometers wide.
“High NA EUV technology is critical as we look to develop smaller, more powerful semiconductors for the age of AI,” said Mukesh Khare, GM of IBM Semiconductors and VP of Hybrid Cloud.
This step introduces a crucial new component to IBM’s semiconductor strategy. It builds on more than ten years of collaboration and adds to their previous work on cleaning nanosheet devices. However, the goal has shifted: High-NA EUV introduces new challenges, where even minor errors can significantly impact yields, and cleaning technologies must adapt rapidly.
And it’s not happening in a vacuum.
Just a few days ago, IBM made headlines by helping HSBC perform the world’s first quantum-enhanced bond transactions, which were 34% more efficient than traditional models.
Image source: Bloomberg/Getty Images
As the semiconductor industry moves closer to the AI age, IBM is not a mere chipmaker; it is an essential enabler, a business that provides the tools and intellectual property that others will need to get beyond the 2nm node.
Why High-NA EUV cleaning is suddenly critical to the AI chip race
High-NA EUV lithography is the most sophisticated way to shape chips that we know of. It is meant to help transistors go smaller than 2 nanometers. EUV employs light with very small wavelengths, which makes features decrease a lot more than typical deep ultraviolet approaches. High-NA systems go even farther by utilizing lenses with a higher numerical aperture to fit more information into each shot.
The stakes are really high. As chips become smaller, the physics becomes less forgiving. When you look at these sizes, the thickness of a fingerprint smudge is much bigger than the transistor gate. Just one little particle or scratch may change the pattern, which means lower yields and millions of dollars wasted on wafer fabrication. That’s why cleaning, which used to be a rather normal part of the fab, is now a big problem for the industry.
This delicate process has helped SCREEN build its reputation. The Kyoto-based firm has the biggest share of wafer-cleaning instruments in the world. It makes systems that clean wafers without hurting the surface. SCREEN is teaming up with IBM, which has a lot of experience with semiconductor integration and process design, to make the whole cleaning ecosystem more stable for the High-NA age.
“By combining SCREEN precision cleaning expertise with IBM’s full stack development flow, we aim to deliver robust solutions that enable our customers to realize the potential of sub-2nm manufacturing,” said Akihiko Okamoto, president of SCREEN Semiconductor Solutions.
For IBM, the alliance provides a path back into prominence in manufacturing without the large capital needs of building a fab. IBM can get into the most vulnerable and perhaps most lucrative part of the AI hardware race by concentrating on intellectual property, integration methodologies, and supporting technologies.
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The two businesses are wagering that success in High-NA EUV will depend on more than just lasers and optics. They also need a cleaner, more accurate pipeline for the wafers that will transport the next generation of computing power.
A closer look: HSBC and IBM’s quantum-powered bond trial
Just before the SCREEN announcement, HSBC (HSBC) and IBM released the findings of what they described as the world’s first quantum-enabled bond trading experiment. The experiment tested IBM’s quantum computers on over a million corporate bond quotations to see whether hybrid models could better forecast trade execution.
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The result: a 34% increase in prediction accuracy compared to traditional approaches. In bond markets with limited liquidity, that buffer has the potential to minimize unsuccessful transactions and improve price.
“This is a ground-breaking world-first in bond trading … we now have a tangible example of how today’s quantum computers could solve a real-world business problem at scale and offer a competitive edge.” — Philip Intallura, HSBC’s Group Head of Quantum Technologies
“Such work is essential to unlock new algorithms and applications … when deep domain expertise is integrated with cutting-edge algorithm research.” — Jay Gambetta, VP, IBM Quantum
IBM presented the study as evidence that quantum technology is transitioning from research to real-world applications. IBM Quantum vice president Jay Gambetta emphasized the need of combining deep domain experience with cutting-edge algorithm research to develop novel algorithms and applications. IBM stock soared on the announcement, providing rare market confirmation for the company’s quantum plan.
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However, critics point to an issue: when researchers ran the identical models sans quantum hardware noise, the advantage vanished. This begs the issue of whether the increases are due to actual quantum advantage or modern machine peculiarities. For IBM, however, the optics are clear: quantum is no longer simply a theory, but a tool that customers can test against real-world data.
What it means for investors and the chip race
The SCREEN agreement and the HSBC quantum trial illustrate that IBM is striving to prove that it is more than just an old IT provider. It is banking that its future resides in controlling the most valuable parts of the stack, such as quantum algorithms, corporate AI infrastructure, or wafer-cleaning know-how.
The transaction strengthens SCREEN’s position as the leader in wafer-cleaning technologies at a time when the whole semiconductor industry is pushing to sub-2nm nodes. As High-NA EUV usage speeds up, its tools might become essential.
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For IBM, the plan is all about power. It doesn’t operate high-volume fabs anymore, but it wants to be the silent force behind the technologies that will shape the AI age. The corporation may be building a lasting edge where size alone isn’t enough if it can prove that discoveries in sensitive areas like quantum computing and wafer cleaning lead to economic value. And this will, ultimately, lead to dividends for IBM stockholders.
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