Discover the thriving Semiconductor Industry in the Netherlands

The Netherlands’ evolution from a land of windmills and tulips to a silicon powerhouse wasn’t overnight. For decades, companies in the region have been pushing the boundaries of microchip manufacturing technology, laying the groundwork for today’s booming industry. Today, the Dutch high-tech sector is developing next-gen processors and leading the way in green and sustainable technologies.

As one of Europe’s leading hubs for microelectronics, the country attracts global talent and significant investment. One example is Fabrizio Del Maffeo, CEO of Axelera AI, a cutting-edge AI-accelerating chip company.

“I thought the Netherlands was the right place because it’s very international, so it’s easy to attract people. The region where I live, in Brabant, is kind of the semiconductor region of the country”, 

Del Maffeo, CEO, Axelera AI

This outlook is primarily due to its established ecosystem and ability to attract global skilled talent. With strategic government policies and thriving industry-academia collaborations, the nation offers unparalleled opportunities for international investors and innovators. The ambition to democratize artificial intelligence across various sectors unfolds against remarkable growth. From 2017 to 2022, the semiconductor sector saw a substantial rise in its economic contribution, surging from 5% to an impressive 24%, with a market valued at around €276 billion.

Definition & Importance

The semiconductor industry in the Netherlands includes the design, fabrication, assembly, testing, and supply of essential components for modern electronics.

“The Netherlands is the only place in Europe where everyone speaks English; it’s very international, really well connected, and has a high quality of life. These factors make it an ideal place for deep-tech industries like semiconductors.”

Del Maffeo, CEO, Axelera AI

 

Semiconductors drive everything from smartphones to medical devices and are vital to the automotive, healthcare, and communications sectors. The Dutch chip technology sector is crucial in global supply chains, advancing AI, IoT, and automotive tech innovations. As one of only three nations with a complete semiconductor value chain, the Netherlands is a top player in the global market.

However, one major challenge is its heavy reliance on international suppliers. In response, the country is developing a National Technology Strategy to reduce dependencies, exploring “friend-shoring” to relocate production to the EU or allied countries, and ensuring a complete semiconductor value chain within a 220 km radius to maintain control and resilience in its supply chain. These actions aim to safeguard the industry while reinforcing its global leadership.

Segment-Specific Insights

The microchip industry is expanding rapidly in several areas, such as automotive semiconductors, AI-driven chips, IoT, and photonic chips.

• Dominance of Equipment Segments

RVO’s report in collaboration with Venture IQ highlights that areas related to semiconductor manufacturing—namely equipment, equipment components, inspection, and metrology—contributed 90% of total earnings growth and 89% of FTE growth in the Netherlands.

• Fastest Growing Segments
  • The Inspection & Metrology subdivision saw the highest FTE expansion, with a 58% national and 62% global increase.
  • Integrated Device Manufacturing (IDM) saw a 32% increase in global revenues, majorly driven by NXP Semiconductors.
  • The IC Design category also grew significantly, with FTE increases of 59% in the Netherlands and 62% globally. However, it still represents a small portion of the overall market.

The automotive electronics domain is rapidly growing with the rise of electric vehicles and autonomous technologies, creating demand for AI-driven semiconductor solutions. Similarly, the IoT niche is expanding as more devices connect, while photonics is gaining traction for its potential to transform data transfer and communications.

Productivity & Economic Impact

The semiconductor industry is a prominent contributor to the Dutch economy, creating jobs and driving innovation. This sector employs over 50,000 people across 300 companies and is essential to maintaining the country’s technological edge and boosting export potential.

The Dutch semiconductor industry is a leading force in the high-tech sector, with €39.1 billion in global revenue in 2021, reflecting 31.1% growth—significantly higher than the Netherlands’ 5% GDP growth that year. This industry’s scale and growth surpass other high-tech sectors like robotics and photonics, and 85% of globally manufactured chips use Dutch technology. Major players such as ASML and NXP, headquartered in the Netherlands, are instrumental in establishing its global footprint.

RVO’s 2022 report indicates that the productivity within the sector has improved, as revenue growth has outpaced FTE growth. This increase suggests that companies are generating more revenue per employee.

The semiconductor industry’s growth in the country is notably higher than the country’s GDP growth rate of 5% in 2021.

Increased the productivity in microchip manufacturing and R&D has established the Netherlands as a leader in innovation and efficient production. This growth also drives expansion in industries like electronics manufacturing and software development.

The semiconductor industry supports multiple sectors by supplying essential components that drive innovation:

Electronics Manufacturing: Semiconductors power electronic devices, with the Dutch industry ensuring a steady supply of high-quality components vital for electronics.

Software Development: Advanced chips enable complex software, including AI and machine learning, expanding software capabilities as chips advance.

Automotive Industry: Companies like NXP provide critical semiconductor tech for automotive applications, including advanced driver assistance systems.

Medical Devices: Reliable semiconductor components are essential for diagnostic and patient care advancements in medical technology.

Key Players & Share

The Netherlands is home to industry giants like ASML, NXP, and ASM, all well-known for their chip technology innovation. 

Key players in the Dutch semiconductor landscape include:

ASML: A global leader in photolithography equipment with a 90% market share, ASML is the only company capable of producing EUV lithography machines for advanced semiconductors. It is the largest semiconductor company in the region by market value (€275 billion) and employs around 39,000 people worldwide.

NXP Semiconductors: A substantial innovator in the automotive, industrial, and IoT sectors, NXP holds 10.8% of the global automotive semiconductor market. In 2023, it reported $13.2 billion in revenues and employs 31,000 people globally, with its Eindhoven campus as a powerful R&D hub.

Besi (BE Semiconductor Industries): Besi specializes in semiconductor packaging and assembly and holds 39% of the global Die Bonder Equipment market. It reported €1.42 billion in revenues in 2023, with a significant focus on high-performance computing and 5G applications.

ASM International: Known for wafer processing equipment, ASM holds 55% of the atomic layer deposition (ALD) market. In 2023, it achieved €2.68 billion in revenue, driven by demand for advanced deposition technologies in chip production.

“The Netherlands is globally recognised for its unique strength in developing advanced semiconductor equipment and its strong, collaborative high-tech ecosystem.” 

Marsha Nieuwland, Consultant, TNO

Tech Advancements

The Dutch region is a hub for semiconductor innovation, especially in AI-integrated chips, 5G, quantum computing, and heterogeneous integration.

“Exciting developments are emerging beyond traditional semiconductor fields, such as photonics and spintronics. These fields are utilizing existing semiconductor knowledge to revolutionize the field, similar to how electronics did decades ago.”

Jerald Delos Santos, Application Engineer, Qualinx

Companies like ASML have pioneered extreme ultraviolet (EUV) lithography, enabling the production of small, more efficient chips that significantly enhance energy efficiency and data processing speeds. Ongoing research in materials science and fabrication techniques further advances chip design and production capabilities.

Regulatory & Policy Environment

The Dutch government’s supportive framework fosters collaboration among companies, research institutions, and universities. With evolving regulations addressing security concerns, it has committed €2.5 billion to strengthen Brainport Eindhoven’s business climate through education, infrastructure, and housing investments.

“Thanks to RVO’s innovation credits, we got the missing capital to complete the development of our first product. The WBSO also reduced employment costs, making the Netherlands one of the most affordable places in Europe for semiconductor R&D.”

Del Maffeo, CEO Axelera AI

However, the industry faces challenges from export restrictions, particularly on advanced chip-making equipment to China, which could affect Dutch firms like ASML. To address this, the Netherlands has implemented strategic export controls to balance economic interests with national security. 

Even Marsha emphasizes the industry must navigate geopolitical tensions and rapid technological shifts to remain competitive globally. 

Additionally, it is actively engaged in European-level strategies, such as the European Chips Act, to strengthen resilience within the semiconductor ecosystem and expand Europe’s market share. This collaborative, EU-wide approach seeks to secure the Netherlands’ role in the global market while mitigating dependencies on non-EU suppliers and balancing economic growth with strategic technological autonomy.