CompanyGraph
Piotech Inc.
688072 · SSE · China
Patterns and etches silicon wafers inside one sealed vacuum system, keeping chips accurate at the smallest feature sizes.
Piotech builds cluster tools that pattern and etch silicon wafers inside a single sealed vacuum system, so a wafer moves from the light-exposure chamber to the plasma etch chamber without ever touching open air. That unbroken vacuum is what makes the tool work at sub-28nm feature sizes — any atmospheric gap between the two steps causes surface oxidation that degrades the precision of the pattern, so the lithography and etch steps are calibrated as one continuous sequence rather than two separate programs. When a fab qualifies a Piotech tool, it is validating that entire coupled sequence, which takes 12 to 18 months, and the resulting process recipes are tuned specifically to the optical and plasma characteristics of that one system — meaning a competitor selling only a lithography tool or only an etch tool cannot displace it, because splitting the steps would reintroduce the atmospheric break the architecture was designed to eliminate. The main thing that prevents Piotech from scaling quickly is that each tool must be assembled and calibrated by hand, in nanometer-level detail, by specialized technicians whose judgment cannot be rushed or easily taught to new staff, so adding capital does not add proportional output.
How does this company make money?
Each tool sells for between $2 million and $8 million. After the sale, the company earns additional recurring revenue from spare parts, consumable components, and annual service contracts — fees that typically add up to 15-20% of the original purchase price each year.
What makes this company hard to replace?
Qualifying a new tool takes 12-18 months of process testing and yield studies before that tool can touch a live production line. The process recipes a fab uses are tuned specifically to the optical and plasma characteristics of the tools it already runs. Switching to a different vendor means throwing out that tuning and revalidating the entire device manufacturing flow from the beginning — an enormous cost in time and lost output.
What limits this company?
Every tool has to be fully built and tuned inside a Class 1 cleanroom by specialist technicians working to tolerances measured in nanometers. That final calibration requires human judgment applied step by step — it cannot be sped up by hiring more people or spending more money, and new technicians cannot be trained quickly enough to meaningfully expand output.
What does this company depend on?
The company cannot run without ultra-high purity quartz components for its optical systems, excimer laser sources for the lithography step, specialized plasma generation chambers, Class 1 cleanroom facilities for assembly, and the semiconductor fab qualification process itself — which takes 12-18 months per new tool model and must be completed before any tool enters production.
Who depends on this company?
Chinese semiconductor fabs would lose the ability to pattern chips at sub-28nm nodes. Memory makers like SK Hynix would hit bottlenecks in their DRAM and NAND production lines. Automotive chip suppliers would face capacity shortfalls for the power management semiconductors that control electric vehicle systems.
How does this company scale?
Process recipes and software control algorithms can be copied to every new tool installation at essentially no extra cost. What does not scale easily is the physical assembly: each tool's optical and plasma subsystems must be individually calibrated by specialized technicians, and that skill cannot be replicated quickly in new hires, so production capacity grows slowly no matter how much capital is available.
What external forces can significantly affect this company?
US export controls under Entity List restrictions block sales to specific Chinese semiconductor companies, shrinking the market the company can legally serve. At the same time, the Chinese government is funding domestic equipment makers, which creates price competition backed by state money rather than commercial returns. Supplies of specialized optical components sourced from German and Japanese suppliers are vulnerable to global shipping and manufacturing disruptions.
Where is this company structurally vulnerable?
If a new patterning technology emerged — such as a dry-resist deposition method that does not rely on an excimer laser and plasma sequence — fabs could buy lithography and etch tools from different vendors without suffering the atmospheric-exposure problem. That would eliminate the technical reason to use one integrated system, and with it the 12-18 month requalification that currently locks fabs in.