AMSTERDAM, Jan 28 (Reuters) - ASML has become Europe's most valuable company thanks to its dominance in making lithography systems, huge "chip printing" machines that cost $250 million each and are indispensable to firms driving the AI boom.

Here is a closer look at the technology behind the Dutch company's rise.

WHAT IS DRIVING DEMAND FOR ASML'S PRINTERS

ASML holds a monopoly on the extreme ultraviolet (EUV) machines applied in the manufacturing of the most advanced semiconductors, though rivals in China and the U.S. are trying to develop alternatives.

Rapid advances in AI and a global build-out of data centres has boosted demand for such chips, making supplying Nvidia's manufacturer TSMC and other makers of AI chips ASML's number one business.

THE TECHNOLOGY: HUGE MACHINES WORKING AT NANOSCALE 

The machines, the size of a school bus and weighing 150 tons, use a complex system of lasers, mirrors and magnets to write microscopic circuitry onto silicon wafers needed in chip production.

They map out layers of circuitry by shining patterns of light onto silicon wafers, each containing maybe a hundred AI chips, with unparalleled precision. 

The EUV wavelength is 13 nanometers. By comparison a human hair is between 80,000 and 100,000 nanometers thick.

The machines offered "patterning precision, scalability and energy efficiency" that advanced chip manufacturing and AI chips in particular depended on, according Luc Van den Hove, CEO of the Interuniversity Microelectronics Centre in Belgium, which collaborated with ASML to develop the technology. 

LASERS AND MIRRORS

To generate the EUV light, droplets of tin are blasted at a rate of 50,000 times per second with some of the most powerful lasers ever built, manufactured by German industrial firm Trumpf. A system of mirrors made by German optical systems maker Zeiss, with surfaces smoother than those used in space telescopes and kept in a vacuum, guides the light into the heart of the machine.

The table holding the wafers levitates on magnets and accelerates and decelerates at a rate of 70 to 80 meters per second.

HOW ARE ASML'S SYSTEMS DELIVERED?

EUV machines are assembled in the Netherlands, then packed into around 40 containers, and taken on 747 cargo planes to plants owned by TSMC of Taiwan, which manufactures chips for Nvidia, as well as Samsung and SK Hynix of South Korea, Intel and Micron of the U.S., and Rapidus in Japan. Last year, ASML shipped 44 such systems and analysts forecast large increases will be needed in 2026 and 2027.

(Reporting by Toby Sterling; Editing by Adam Jourdan and Tomasz Janowski)