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Meta Title: ASML Slashes 3,000 Manager Jobs to Get Engineers Back to Engineering Meta Description: Chip equipment monopolist cuts two-thirds of engineering leadership as engineers complain of bureaucracy. 1,400 become ICs again. URL Slug: asml-management-cuts-engineering-focus Primary Keyword: ASML layoffs Secondary Keywords: ASML restructuring, semiconductor manufacturing, EUV lithography, engineering management Tags: ["ASML", "semiconductors", "layoffs", "engineering", "management", "EUV", "chip manufacturing", "corporate restructuring", "Netherlands"]
ARTICLE
ASML Axes Two-Thirds of Engineering Managers as Company Bets on Flatter Hierarchy
The world's sole EUV lithography maker eliminates 3,000 of 4,500 management positions while posting record profits
ASML, the Dutch company that holds an effective monopoly on the machines that print the world's most advanced semiconductors, announced on January 28, 2026 that it plans to eliminate roughly 3,000 management positions in its engineering organization. About 1,400 of those managers will transition into individual contributor engineering roles. The rest are out.
The announcement landed alongside a record earnings report: €9.6 billion in net profit for 2025, up 26% from the prior year. Q4 bookings hit €13.2 billion, more than double analyst expectations. The stock jumped 7% at the open.
The math is stark
ASML currently employs around 44,000 people. The company says it will end up with a net reduction of about 1,700 positions, mostly in the Netherlands and some in the United States. But the restructuring itself is more dramatic than that headline number suggests.
The engineering organization alone is going from 4,500 managers to roughly 1,500. That's a reduction of two-thirds. Of the 3,000 positions being eliminated, the company expects 1,400 people to move into new engineering roles, which means they were managers who will become engineers again. Whether those individuals view that as a demotion or a relief probably varies.
CEO Christophe Fouquet didn't mince words on the earnings call. The company's own engineers, he said, had been complaining that the organization had grown too complex. They were spending too much time on process and not enough on actual innovation. According to Fouquet, engineers specifically requested that ASML simplify things so they could get back to work.
An unusual move at an unusual company
This isn't a company in trouble. ASML is the sole manufacturer of extreme ultraviolet lithography machines, the equipment that chipmakers like TSMC, Samsung, and Intel need to produce anything at the leading edge. There's no alternative supplier. When AI demand drives semiconductor capacity expansion, ASML captures essentially all of that lithography spend.
The company's press release frames this as a proactive choice made from strength rather than necessity. And the financials back that up. Revenue guidance for 2026 came in at €34-39 billion, above analyst expectations. The company announced a new €12 billion share buyback program. China sales are expected to decline to 20% of revenue from 33% as export restrictions bite, but AI-driven demand elsewhere more than compensates.
What makes the restructuring notable is who's getting cut. Tech industry layoffs over the past few years have typically hit junior employees, customer support, and non-technical roles. This is different. ASML is specifically targeting management layers in its engineering organization, which suggests the company believes it added too many chiefs and not enough Indians during the rapid growth of recent years.
"Engineers told us" is doing a lot of work here
There's a quote in the official announcement that's worth examining. The company says it heard this from its engineers:
Engineers in particular have expressed their desire to focus their time on engineering, without being hampered by slow process flows.
That's corporate speak, but it points to something real. When you go from a relatively small company to 44,000 employees in a few years, you tend to add coordination overhead faster than you add productive capacity. Project management roles multiply. Matrix structures emerge. Decision-making slows down as more people need to be consulted.
Fouquet explicitly called this out, noting that R&D spending had grown from €2.5 billion to €4.7 billion and that this scaling had introduced organizational friction. The restructuring, he said, is about restoring agility.
Whether that's achievable through layoffs alone is another question. Organizational complexity tends to have root causes beyond just headcount, things like internal politics, risk aversion, and legacy processes. You can cut managers and still end up with the same slow decision-making if the underlying culture doesn't change.
The AI angle
ASML's customers, TSMC, Samsung, SK Hynix, Micron, have all been expanding capacity to meet AI-driven demand. Memory makers in particular are racing to build out HBM production, and that requires more EUV lithography layers than traditional DRAM. CFO Roger Dassen noted on the call that memory supply is expected to remain tight through at least 2026.
The restructuring isn't a response to weak demand. It's the opposite. ASML wants to move faster because customers are asking for more machines sooner. Fouquet said the company is shifting its Technology organization from a project-based matrix structure to one where engineers are dedicated to specific products and modules. The goal is simpler decision-making and faster execution.
What happens next
The company says it will work with unions and works councils in the Netherlands over the coming weeks to finalize the restructuring details. Precise costs haven't been disclosed, though management characterized them as not material to the overall business.
For the roughly 1,600 people losing their positions (1,700 net cuts minus new roles created elsewhere in Manufacturing, Customer Support, and Sales), the next few months will be uncertain. European labor laws provide more protection than their American equivalents, so the process will take time.
ASML expects the second half of 2026 to be stronger than the first as customer fabs come online and the company's EUV shipment rate accelerates. The restructuring is supposed to help the company capitalize on that demand. Whether flattening the org chart actually translates to faster innovation is something we won't know for a while.
But it's an interesting bet. Most tech companies respond to growth by adding management layers. ASML is explicitly going the other direction.
