Cymer, Inc.

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Cymer, Inc.

17075 Thornmint Court
San Diego, California 92127
Telephone: (858) 385-7300
Toll Free: (888) 692-9637
Fax: (858) 385-7100
Web site:

Public Company
1986 as Cymer Laser Technologies, Inc.
Employees: 770
Sales: $418.0 million (2004)
Stock Exchanges: NASDAQ
Ticker Symbol: CYMI
NAIC: 333298 All Other Industrial Machinery Manufacturing

Cymer, Inc. is the leading supplier of excimer lasers, which are used in the manufacture of semiconductors. Excimer lasers deliver deep ultraviolet photolithography light sources in highly narrow bandwidth, enabling complex circuit designs that deliver high processing speeds. Cymer controls more than 90 percent of the worldwide market for excimer lasers, conducting its assembly, integration, and testing activities at a 265,000-square-foot facility in San Diego, California. The company also maintains a refurbishing facility in Korea. Cymer's customers include all three manufacturers of deep ultraviolet photolithography systems, ASML Holding N.V., Canon Inc., Nikon Corp., and numerous semiconductor manufacturers, including Advanced Micro Devices, Inc., Intel Corp., Toshiba Corp., and Texas Instruments Inc.


At one point, when Robert P. Akins and Richard L. Sandstrom reached a crossroads in their careers, they thought about running a hamburger outlet together. It would have been an odd choice for two physicists with Ph.D.s who had just abandoned work on the Strategic Defense Initiative, but for a brief period, while mulling their future over beers at a beach bar named Belly Up, the pair thought about buying a hamburger franchise instead of continuing their development of excimer lasers. Had their discussion reached a different conclusion, Cymer would not have been formed, advances in computer processing power likely would have been stunted, and the Wendy's restaurant chain, having just opened its 3,000th unit, would have gained one more outlet.

Akins and Sandstrom met at the University of California's San Diego campus (UCSD). Akins arrived in 1969 and spent the next five years pursuing studies in two different directions, earning a bachelor's degree in physics and a bachelor's degree in literature. He chose to continue his education in physics, thinking his career opportunities would be greater in the sciences, and, as a graduate student at UCSD, he met Sandstrom, who had earned a bachelor's degree in physics. Akins earned his doctorate degree in optical information processing, a form of computing in which light replaces electricity. Sandstrom concentrated his work on the behavior of laser light as it traveled through the atmosphere.

After earning their degrees (Sandstrom, according to Akins, was the more talented scientist of the two), the pair joined a defense contractor based in San Diego named HLX Inc. They spent six years working together at HLX, lending their talents to projects related to laser-induced nuclear fusion, a satellite-to-submarine laser communications link, and the Strategic Defense Initiative. It was heady work, leaving each a bit disillusioned and restless after a half-dozen years. "When the technology starts to get overwhelming," Sandstrom said in a February 24, 1997 interview with Forbes, "you want to be a farmer." Akins echoed the sentiment, telling Forbes, "We wanted to spend the productive years of our lives doing something more aligned with the real world."

They left HLX and spent several weeks playing frisbee on a beach near Del Mar, California, plotting their next move at the Belly-Up. "It was 1985," Akins noted in his Forbes interview, and "fast-food franchises were hot."

Once Akins and Sandstrom shelved plans to buy a Wendy's restaurant, they turned their attention to the high-technology world they left behind, their spirits evidently refreshed. At HLX, they were working with excimer lasers, a type of laser developed by IBM that used a mixture of reactive and inert gases to produce deep ultraviolet light (DUV). Akins and Sandstrom realized that excimer laser technology was not suitable in orbit during the course of their research at HLX, but they believed that there were other applications that might work, a belief that was held by Akins in particular. Sandstrom was recognized as the superior scientist, while Akins was hailed as the visionary, perceiving potential in technology that others did not see. Supported by Akins's vision and Sandstrom's scientific acumen, and little else, Cymer Laser Technologies, Inc. (the name was shortened later) was formed in 1986 to explore the potential of excimer laser technology in commercial applications.

Akins and Sandstrom briefly tried to apply excimer laser technology to the medical device industry before Akins guided the company in the proper direction. The semiconductor industry became the focus of the company's efforts, but it would be years before the two would meet in the marketplace. Cymer was just beginning the long research and development phase of its existence; the semiconductor industry did not yet require the advanced capabilities of excimer laser technology. The demands of semiconductor manufacturing needed to catch up to Akins's vision, and Akins needed to make his vision a reality. "For a long time," Akins said in a December 2, 2002 interview with the San Diego Business Journal, Cymer's excimer laser technology "was a solution looking for a problem."

The gap separating the two, a gap that represented the time it would take for Cymer to become a financially healthy enterprise, narrowed as research and development work progressed under Sandstrom's guidance and as Moore's Law proved itself to be an accurate and predictable phenomenon in the semiconductor industry.


Virtually every late generation consumer electronic devicewhether a PC or laptop, cellular phone, pager, PDA, internet server, modem, appliance or automobilecontains a semiconductor manufactured using a Cymer light source. Today's advanced devices require smaller, faster chips with increased power and functionality, and the chipmakers turn to Cymer to provide the light source critical to producing these chips.

In 1965, Gordon Moore, a cofounder of Intel Corporation, was writing an article, titled "Cramming More Components onto Integrated Circuits," when he made the observation that each new generation of memory chips contained roughly twice as much capacity as their predecessors, with 18 to 24 months separating each generation. The observation formed the basis of what became known more than a decade later as Moore's Law, that the number of components on chips roughly doubled at a regular, exponential rate. As Akins and Sandstrom worked on making the performance and stability of their technology suitable for its commercial debut, the concept of exponential increases on the other side of the technological gap worked in their favor. Originally, semiconductor manufacturers used visible light in a manufacturing process called photolithography, the imaging of complex circuit patterns onto chips through camera-like imaging tools known as steppers and scanners. Once a wafer of crystalline silicon was coated with light-sensitive chemicals and put into a stepper, the stepper sent pulses of light through a stencil dictating the circuit pattern. Moore's Law postulated that the complexity of the circuit pattern would increase exponentially over a relatively short, predictable period of time, but the complexity of the pattern depended on the thinness of the circuit lines, which, according to the laws of optics, could be only as thin as the wavelength of light shining through the stencil. Consequently, as engineers tried to squeeze more electronics onto a wafer, increasingly narrower wavelengths were needed. Eventually, Akins realized, semiconductor manufacturers would need the precision of excimer lasers, but as Cymer was starting out, no one needed light sources as precise as the company's prototype laser.

By the time Cymer was founded, semiconductor manufacturers had stopped using visible light and relied on the shorter wavelengths of invisible ultraviolet light. Cymer's hopes of entering the market rested on the development of its technology and weaning chipmakers off of ultraviolet light emitted by hot mercury gas, the prevailing type of light source used during the late 1980s. The development of its technology, an effort spearheaded by Sandstrom, was forced to subsist on meager financial resources, relying initially on the help of the machine shop at UCSD. The company lacked the capital to have the components of its laser manufactured by others, so Sandstrom and Akins made the components themselves with the lathes and milling machines at their alma mater. "We'd go in on a Saturday morning at 9 a.m. and come out at 7 or 8 p.m. with one set of electrodes," Akins recalled in his February 24, 1997 interview with Forbes.

"When it came time to pay for the equipment and materials, the guy who ran the shop told us, 'I'll just keep this thing [the invoice] in the bottom drawer until you guys get the money to pay for it.'"

By the end of 1986, the invoice at the machine shop totaled $250,000, a bill the company was unable to pay until it received its first infusion of capital from outside investors in 1988. The money, $3.2 million invested by a venture capitalist, provided some relief, but additional rounds of financing were sporadic. The company eked by on funds obtained from government grants, investments by foreign companies, and by selling a few lasers for use on pilot projects. Both Akins and Sandstrom took out second mortgages on their homes to keep the company financially alive.


The lean times continued into the 1990s, testing the resolve of Akins and Sandstrom. In 1990, the capability of mercury ultraviolet light, with a wavelength of 0.48 micron, looked to be headed toward obsolescence as engineers began designing chips with circuit lines thinner than 0.5 micron, but scientists were able to circumvent the laws of optics, further delaying the need for Cymer's excimer laser technology. By coating wafers with new high-resolution photoreactive chemicals, semiconductor manufacturers were able to etch lines thinner than mercury ultraviolet light's wavelength, pushing the limits of the light down to 0.35 micron, the specification required for advanced chips that would be in use until the late 1990s. Fortunately for Cymer, the company did not have to wait until the 21st century for the market to demand a product on which it had been working since 1986. By 1995, chipmakers realized they soon would need the capabilities of Cymer's technology. Orders for the company's laser, which used a mixture of krypton and fluoride to deliver a 0.25 micron beam, began coming in, pushing revenues for 1995 up to $18 million. Cymer's business began to grow vigorously the following year, when it completed its initial public offering of stock in September. By the end of 1996, after orders increased 350 percent, revenues hit $65 million.

Once the semiconductor industry turned to excimer lasers, Cymer grew at a blistering pace. Equipment suppliers to semiconductor companies such as Intel, NEC, and Motorola desperately needed ultraviolet lasers, and Cymer, one of only three companies in the world capable of making an excimer laser, quickly dominated the market it had helped to create. By the end of the 1990s, the company had installed its 200th DUV excimer laser in Japan, which gave it control of more than 80 percent of the market there. Worldwide, the company maintained an installed base of more than 800 lasers by the end of the decade, a total that amounted to more than a 90 percent share of the total excimer laser market. Cymer's dominance translated into rapid financial growth, lifting sales to $366 million in 2000, more than five times the total collected four years earlier.


Cymer is founded.
The company receives $3.2 million in venture capital.
Excimer lasers become the tools of choice in the semiconductor industry.
Cymer completes its initial public offering of stock.
The company controls more than 90 percent of the worldwide market for excimer lasers.
A downturn in the semiconductor industry leads to a $15.4 million loss for the year.
As market conditions improve, financial vitality returns to Cymer; sales eclipse $400 million for the first time in the company's history.


As Cymer entered the 21st century, it maintained its overwhelming control over the global market for exci-mer lasers, but the early years of the decade brought the company's incredible pace of growth to a halt. The semiconductor industry, a notoriously volatile market, experienced what arguably was the greatest downturn in its history. Companies worldwide felt the pinch of a slumping market, and Cymer was no exception. Between 2000 and 2002, revenues slipped from $366 million to $288 million. Net income during the period plunged from $63 million to $13 million. In 2003, the pattern continued, but with far greater severity. The company lost $15.4 million during the year on sales of $265 million.

As Cymer prepared for its 20th anniversary and the years beyond, the company occupied enviable ground. Its dominant market position began to deliver better financial results once conditions in the semiconductor market improved. In 2004, when refurbishing activities were included for the first time on the company's balance sheet, Cymer generated $418 million in revenue and posted $43 million in net income. The company, in a development agreement with Intel, was busy working on a production-worthy extreme ultraviolet (EUV) source, which was expected to be completed by the end of the decade. In the interim, the company's domination of the market for DUV lasers promised to deliver continued financial growth. The announcement in late 2004 that Coherent, Inc.'s subsidiary, Lambda-Physik, was exiting the excimer laser business in the semiconductor industry made Cymer's already stalwart market position even more formidable. After a decade of development followed by a decade of market supremacy, the Akins-led company promised to play a prominent role in the advances in semiconductor technology for years to come.


Cymer B.V. (Netherlands); Cymer Japan, Inc.; Cymer Korea, Inc.; Cymer Singapore Pte. Ltd.; Cymer Southeast Asia, Ltd. (Singapore); Cymer Semiconductor Equipment (Shanghai) Co. Ltd. (China).


Jenoptick Aktiengesellschaft; Gigaphoton, Inc.; Komatsu Ltd.


Bengston, Stacey, "Cymer, Inc. Has Announced Appointment of Edward Brown Jr. As Its New President and Chief Operating Officer," San Diego Business Journal, September 12, 2005, p. 35.

"Cymer of U.S. Installs 200th DUV Laser in Japan," AsiaPulse News, November 23, 1999.

"Cymer Receives First Order from Korean Chip Manufacturer," AsiaPulse News, April 24, 2001, p. 648.

Freeman, Mike, "San Diego-Based Laser Maker Due $20 Million in Funding from Intel," San Diego Union-Tribune, January 27, 2004.

Gaut, Stephen, "Rancho Bernardo, Calif., Laser Tech Products Firm to Buy Massachusetts Firm," North County Times, November 21, 2000.

, "San Diego-Based Laser Tech Group Plans Office in South Korea," North County Times, November 8, 2000.

Graves, Brad, "Laser-Like Vision," San Diego Business Journal, December 2, 2002, p. 44.

McHugh, Josh, "Laser Dudes," Forbes, February 24, 1997, p. 154.

Phelps, Christi, "Cymer Laser Technologies Closes Deal for $3.2 Million," San Diego Business Journal, July 4, 1988, p. 2.

Slavin, Terrence, "Illuminating the Semiconductor Industry," San Diego Business Journal, March 27, 2000, p. B4.