Chasing ASML’s Dominance: Canon and Nikon Are Doing Something The Market Misses

Chasing ASML’s Dominance: Canon and Nikon Are Doing Something The Market Misses Alex Sirois Fri, September 18, 2026 at 1:59 AM GMT+9 4 min read ASML +0.93% ASML +0.93% Quick Read ASML posted $10.65B in Q2 revenue and raised full-year guidance to €44B, while Canon's nanoimprint targets chip layers where a $400M EUV tool is overkill.

Kioxia's nanoimprint adoption gives Canon a production foothold in memory, and a second qualifying chipmaker by 2027 would sharply re-rate the stock.

ASML (NASDAQ: ASML) just posted another blockbuster quarter, while Canon (OTC: CAJPY) quietly pushed its nanoimprint lithography platform deeper into customer fabs. Both stocks trade on the same theme: who patterns the next generation of chips, and at what cost. ASML owns the leading edge. Canon, alongside Nikon, is chasing an entirely different lane that Wall Street barely models.

ASML's Q2 2026 was a statement quarter. Revenue hit $10.65B, up 21.3% YoY, with EPS of $8.67 and free cash flow surging 268% year over year. Management raised full-year guidance to €43 billion to €45 billion. Memory net system sales are expected to grow over 75% in 2026, driven by HBM and advanced DRAM nodes. That is the kind of quarter that reshapes multi-year models.

Canon's lithography ambitions look tiny by contrast, but the strategy is real. Its FPA-1200NZ2C nanoimprint system stamps circuit patterns onto wafers using a mask, sidestepping the physics and price tag of EUV. Nikon, meanwhile, keeps iterating on i-line and ArF scanners for mature nodes. Instead of challenging ASML at 2nm, both target the layers below it, where cost per wafer matters more than resolution.

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ASML's own commentary underscores the opening. CEO Christophe Fouquet said customers are "aggressively" adding capacity, and CFO Roger Dassen described upgrade demand as "very, very strong because customers are looking for productivity." That pricing power is real. It also creates a wedge for cheaper alternatives on layers that do not need a $400 million High NA tool. Kioxia has publicly adopted Canon's nanoimprint approach for select memory work, which is exactly the kind of foothold that compounds quietly.

I will be watching whether High NA EUV reaches the maturity ASML needs to justify its price against low NA plus multi-patterning. Fouquet flagged Intel Foundry adoption as "maybe the strongest sign so far that we're getting there." On the Canon side, the tell is customer count. If a second or third memory maker qualifies nanoimprint for production layers in 2027, the narrative shifts.

For me, ASML remains the cleaner way to own lithography. The 83.61% one-year run reflects backlog visibility that few capital equipment names ever get. Yet the stock also dropped 14.92% over the past month, a reminder that expectations are high. Canon, essentially flat with a 3.05% YTD decline, is the option trade. If nanoimprint scales, the re-rating could be sharp. If not, you still own a diversified imaging and medical business. Different risk, different reward, same industry tailwind.

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