Metrology and Inspection

Process control tools were a $15.7 billion market in 2025^[1]. KLA puts the whole wafer equipment market, including advanced packaging, at about $120 billion that year^[2]. CSET's count for 2025, built on TechInsights data, puts KLA at 56.8 percent, about five times Applied Materials' 11.2 percent^[1]. At its March 2026 investor day KLA cited Gartner's figures for 2024, which put its share at 56.5 percent, 6.5 times its nearest competitor^[3]. In April 2026 KLA said its 2025 share was about 7 times the nearest competitor's^[4]. The figures rest on different data and years, so the multiple runs from about 5 to about 7.

How it works

An inspection tool sweeps a beam of light across the wafer, photographs it, and compares the image of each chip with the image of its neighbors. The chips on a wafer are meant to be identical, so anything that shows in one and not the others is a defect, and the tool records where it is. For faults too small for light to show, a second tool scans a beam of electrons across a small patch and builds a picture from the electrons that bounce back.

A metrology tool measures known shapes. It shines light on a test pattern printed beside the circuits and works out from the scatter how wide the lines are and how thick the film is, and it reads marks printed in this layer and the last to measure how far the two are out of line, which is overlay.

The fab pays for all this to protect yield, the share of chips on a wafer that work. A wafer loses value two ways: whole regions ruined by mishandling, misalignment or over-etching, and single circuits killed by stray material or an airborne particle^[5].

A bigger chip is a bigger target for the second kind, and the loss grows faster than the area. In the standard formula, die yield is (1 + D0A/a) to the power minus a, where D0 is defects per square centimeter, A is die area and a is a clustering constant of 3 to 4, which says how much defects bunch together. At a defect density of 0.8 per square centimeter, with a set to 3, a 1 square centimeter die yields 49.2 percent and a 2 by 2 centimeter die 11.3 percent, so the bigger die, which also fits fewer times on a wafer, costs 20.1 times as much^[5].

Run that equation with a clustering constant of 3 for an 8 square centimeter die, about as much as one exposure can print, and it yields about 49 percent at a defect density of 0.10 and about 69 percent at 0.05^[5]. Getting from one to the other is yield learning, which means finding the process step that is losing dies and fixing it.

Those percentages are the share of dies with no killer defect. A chip built from many identical blocks can carry spares and switch off a faulty block^[5]. Nvidia's full H100 design has 144 of its main computing blocks, called streaming multiprocessors, and the SXM5 version it ships has 132 turned on^[6]. So the share of dies that can be sold is higher than the formula gives. What the formula shows is how fast flawless dies get scarce as chips grow.

Why big chips lose more to defects

1. Specks land. Specks of dust and tiny flaws land at random on every wafer.
2. Small chips. Cut into small chips, almost every chip misses every speck.
3. AI-size chips. An AI chip covers eight times the area, so about half of them catch a speck and fail.
4. Half the specks. Halve the specks and about seven in ten AI chips work. Finding defects pays most on the biggest chips.

Simulated 300 mm wafer: 68 specks, 0.10 per square centimeter, placed at random in loose clusters. The share of flawless chips follows the formula above with a clustering constant of 3.

Variants and trade-offs

The tools trade sensitivity against speed. All the market sizes and shares below are CSET's, for 2025^[1].

• Defect inspection scans a whole wafer with light or electrons and compares each die against its neighbors. It is by far the largest family, $6.7 billion, and the one KLA dominates, at 85.9 percent. ASML's HMI eScan 1100 runs 25 electron beams at once, up to 15 times the throughput of single-beam inspection tools, and finds patterning defects down to 7 nm^[7].
• Film and shape metrology measures how thick each film is and how flat the wafer sits, without cutting it open: $2.6 billion, with KLA at 45.6 percent, Nova at 24.6 and Onto Innovation at 10.9. Onto paid about $720 million in August 2026 for 27 percent of Japan's X-ray maker Rigaku^[8].
• Mask inspection and repair gets its own tools, because a defect on a mask repeats on every die: $2.2 billion, and one of two families where KLA has a close rival, 45.9 percent against Lasertec's 42 and Zeiss's 10.1. Lasertec also makes actinic inspection tools, which check EUV masks with the same 13.5 nm light that prints them, and it calls its ACTIS A150 the world's first EUV patterned mask inspection system^[9]. KLA's own actinic mask inspection tool was still at an early demo stage at its March 2026 investor day^[3].
• Overlay metrology measures whether this layer sits on the one below: $991.4 million, split almost evenly between KLA at 51.5 percent and ASML at 47.9.
• Critical dimension metrology measures how wide a printed feature actually came out: $1.2 billion, and the one family Japan leads, with Hitachi at 71.9 percent and Applied Materials at 27.5.
• Electron-beam metrology resolves detail too fine for light: $1.3 billion, led by Applied Materials at 45.1 percent with ASML at 35.6 and KLA at 18.8.

Process control market by tool family, 2025$M

Process control market by tool family, 2025

Defect inspection	6,700 $M
Film and shape metrology	2,600 $M
Mask inspection and repair	2,200 $M
E-beam metrology	1,300 $M
CD metrology	1,200 $M
Overlay metrology	991.4 $M
Defect review	729.1 $M

Source: ETO Supply Chain Explorer, CSET

Who makes it

KLA held 56.8 percent of a $15.7 billion market in 2025^[1]. KLA says its share grew 3.6 percentage points from 2021 to 2025^[4]. Its fiscal 2026 revenue was $13.579 billion, after $12.156 billion in fiscal 2025^[10], and it says it gained share again in 2025 across mask, optical wafer and e-beam inspection^[4].

Process control tool revenue share, 2025%

KLA56.8%Applied Materials11.2%Lasertec6.4%Hitachi High-Tech6.2%ASML5.9%Nova4.3%Onto Innovation2.6%Camtek1.6%Rigaku1.2%All others3.8%

Source: ETO Supply Chain Explorer, CSET

The rest are specialists, and none holds more than 11.2 percent, by CSET's count for 2025^[1].

• Applied Materials is the largest of them at 11.2 percent, selling e-beam defect review, CD-SEM line-width tools and e-beam metrology next to the deposition and etch tools that create the defects.
• Lasertec holds 6.4 percent, almost all of it mask inspection; Hitachi High-Tech 6.2 percent, most of it CD-SEM; ASML 5.9 percent through YieldStar overlay and HMI e-beam metrology.
• Nova holds 4.3 percent, through film metrology, and took $880.6 million of revenue in 2025^[11].
• Onto Innovation holds 2.6 percent on $1,005.3 million of 2025 revenue^[12] and Camtek 1.6 percent on $496.1 million^[13].

Patterning, which includes metrology products and reticle inspection, grew 61 percent year on year in the June 2026 quarter, when Taiwan took 31 percent of KLA's revenue and China 26 percent^[2].

KLA revenue by product line, June 2026 quarter%

Wafer inspection49%Services22%Patterning20%PCB and component inspection4%Specialty semiconductor process4%Other1%

Source: KLA letter to shareholders, Q4 FY2026

Process control's share of fab spending is still rising, and in memory KLA credits higher performance specifications, less redundancy and more logic content in devices built for high-performance computing^[4].

KLA's systems also apply AI-driven analytics and noise suppression, and KLA says it has added AI capabilities across its entire product portfolio over the past five years^[4].

Packaging, AI and China

The AI build-out is increasing the importance of advanced packaging and of the process control it needs^[2]. KLA took the number one position in advanced wafer-level packaging process control in 2025, adding 14 points^[4], and expects about $1.1 billion of packaging process control revenue in 2026, more than 70 percent growth^[2]. Onto signed a volume purchase agreement estimated at over $240 million with an HBM maker for 2D inspection and 3D bump metrology through 2027^[12].

Chinese makers are still small in process control, but one of them is growing fast. CSET's count, built on TechInsights data, puts all Chinese firms at 0.7 percent of a $15.7 billion market in 2025^[1]. Skyverse (Shenzhen Zhongke Feice), which makes wafer inspection and metrology tools, reported 2.05 billion yuan of revenue in 2025, about $285 million, up 48.75 percent on 2024 and more than double its 2023 revenue^[14]. That alone is about 1.8 percent of CSET's market, more than twice CSET's figure for all Chinese firms, so the CSET count may miss some domestic sales^[1]. In its 2025 annual report Skyverse says Chinese makers still hold a low share of China's market for these tools and that KLA holds the largest share of it^[14]. By CSET's 2025 count, Chinese firms held 0.6 percent of defect inspection tools^[15]. They held 0.4 percent of line-width measurement in 2025^[16]. In film and shape metrology they held 2 percent in 2025, all of it from Raintree Scientific Instruments, or RSIC^[17]. They held no share of photomask inspection and repair tools in 2025^[18]. Nor did they hold any share that year of the tools that inspect wafers during advanced packaging^[19].

In October 2022 the US began requiring a license for any US-made item, process control tools included, bound for a Chinese fab that made logic chips at 16/14 nm or below, NAND memory with 128 or more layers or DRAM at 18 nm half-pitch or below^[20]. The December 2024 rule added specific process control tools to the export lists. It controls defect inspection and measurement of patterned 300 mm wafers where the tool can find defects of 21 nm or smaller using light below 400 nm, or an electron beam resolving 1.65 nm, or a cold field emission source, or two or more beams^[21]. The same rule controls overlay metrology accurate to 0.5 nm or better that is built into the track, the machine that coats and develops the light-sensitive resist, or that can switch wavelengths quickly, and stand-alone wafer shape metrology that feeds corrections to immersion or EUV scanners^[21]. A separate new entry, 3B994, covers optical film and line-width metrology for 300 mm wafers with software for measuring non-planar transistors^[21]. BIS placed these tools in new entries for items it says also have legitimate uses in older chipmaking, so they carry narrower license requirements than tools built only for advanced chips^[21]. A new foreign direct product rule extends US jurisdiction to specified foreign-made chipmaking tools bound for Macau or for a Country Group D:5 destination such as China^[22].

The chokepoint

Process control is a chokepoint of concentration. Several firms can build a good film metrology tool, but one firm leads most kinds of process control tool, and its share is still growing. A fab that can buy scanners and etchers but not sensitive inspection tools finds fewer of the defects that lower its yield, so its yield rises more slowly.

Key evaluation criteria

• Sensitivity. The smallest killer defect a tool can find. ASML's multibeam system is specified to 7 nm patterning defects^[7].
• Throughput. Wafers per hour, which decides how many lots a fab can afford to look at; multibeam gives up to 15 times the throughput of single-beam tools^[7].
• Nuisance rate. The share of flagged events that turn out not to be real defects, which is what AI classification is meant to reduce.
• Sampling plan. How many wafers and sites per lot, a cost decision as much as a physics one, which sets what process control costs the fab.
• Time to result. How fast a measurement reaches the process engineer, which sets the speed of yield learning.