Taiwan Semiconductor Manufacturing (NYSE: TSM), the world's largest contract chipmaker, produces the world's smallest, densest, and most power-efficient chips. That makes it a bellwether of the semiconductor industry and a crucial partner for fabless chipmakers like Apple, Advanced Micro Devices, and Nvidia.

However, TSMC wouldn't have sprinted ahead of Intel (NASDAQ: INTC) and Samsung in the "process race" to manufacture more advanced chips without the Dutch semiconductor equipment maker ASML (NASDAQ: ASML), the world's leading producer of lithography systems for etching circuit patterns onto silicon wafers. TSMC's earlier adoption of ASML's extreme ultraviolet (EUV) lithography systems enabled it to produce the world's tiniest chips.

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Source Fool.com