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We've spun the wheel for Europe and the ticker has landed on a company from the Netherlands that almost nobody outside the semiconductor industry has heard of. And yet without it, the chip in your phone almost certainly could not exist.

Before we dive in, a reminder of what the index itself has delivered over time.

Every week, we pull one company at random from the FTSE All-World with ~4,200 companies representing 90% of global stock market wealth. We share the index's long-term returns as a reminder of why we're here: the long game. New to the newsletter? Start here.

Founded in 1968 in the Netherlands. Listed on Euronext Amsterdam.

Think about the chip in your phone. It contains billions of transistors, each smaller than a virus. Building them requires depositing hundreds of ultra-thin layers of material onto a silicon wafer in a precise sequence. You cannot do that with a paintbrush or a spray can. At this scale, you need machines capable of depositing material one atom at a time.

ASM International builds those machines. Not to be confused with ASML, the Dutch chip company you may have heard of. More on that connection later.

A few key facts:

We'll come back to that thirty percent operating margin in a moment.

ALD stands for Atomic Layer Deposition. It's the core technology ASM has spent decades perfecting, and explaining it is simpler than it sounds.

Imagine painting a wall, but instead of brushstrokes, you use chemistry. You flood a sealed chamber with one gas. It reacts with the surface and forms exactly one molecular layer, then stops. You flush it out. You introduce a second gas. One more layer. You repeat this hundreds of times. The result is a coating of almost unimaginable precision: perfectly uniform, perfectly thin, no gaps, no clumps.

Why does this matter? Because modern chip transistors are now just a few atoms wide. At that scale, even a tiny inconsistency in a layer ruins the transistor. ALD is, at this point, the only deposition technology that can do the job. It's not one option among several. It is the only option.

ASM holds more than 55% of the global ALD equipment market. When TSMC in Taiwan, Samsung in South Korea, or Intel in the US builds their most advanced chip, they use ASM machines. The company's engineers are typically embedded in customer factories years before a new chip design even goes into production.

ASM also makes Epitaxy systems. Those are machines that grow a crystalline silicon foundation layer on a wafer before the chip is built on top. But ALD is the crown jewel.

You may have heard of ASML, the Dutch company that makes the world's most sophisticated chip-printing machines. The stock market values ASML at over €400 billion.

Here is something almost nobody knows: in the mid-1980s, ASM and Philips formed a joint venture to develop lithography technology. That joint venture became ASML. ASM sold its stake in 1988.

The Netherlands, a country of 18 million people, produced both of the world's most critical semiconductor equipment companies. ASM came first.

A standard industrial equipment company earns operating margins of 10–15%. ASM earns 30%.

The explanation is structural. ASM doesn't compete on price. It competes on capability, solving technical problems that nobody else can solve yet. Chipmakers don't shop around for the cheapest ALD machine. They work with ASM for years before a new chip generation, co-developing the exact process needed. By the time production starts, switching suppliers is not a real option.

There is also a compounding dynamic. Every new chip generation requires more ALD steps than the last. The latest architecture shift significantly increases the number of ALD steps per chip. More steps means more ASM machines per factory.

Revenue has compounded at 20% per year from 2020 to 2025. Operating profit nearly tripled in the same period.

€3.2 billion in revenue in 2025. €938 million in operating profit. Ninth consecutive year of double-digit growth. Not bad for a company most people have never heard of. 

Over the past 25 years the stock has compounded at close to 20% per year. The market has noticed and the valuation reflects it with a forward P/E of ~38x. 

The main risk worth noting is China. More than 30% of ASM's revenue came from China in 2025. Export restrictions by the Dutch and US governments have already constrained what ASM can sell there. The situation is ongoing and unresolved.

Every AI data centre being built right now requires advanced chips. Every advanced chip requires ALD. The next chip node — 1.4nm, entering pilot production later this year — requires even more ALD steps per chip than the current one. ASM's target is €5.7 billion in revenue by 2030, roughly doubling from today.

The company that makes the machines that make the chips that run everything is headquartered in Almere, Netherlands, with 4,500 employees.

We're glad it's in our portfolio.

Data and images sourced from ASMI Annual Report 2025 and ASMI Investor Presentation 2025.

Next week, we'll be looking at a company from Developed Asia-Pacific.