On Tuesday, Asml’s stock, the world’s leading microchip machinery company, fell by more than 4 percent due to a new US bill aimed at tightening trade restrictions with China. The bill in question is the Match Act (from Multilateral Alignment of Technology Controls on Hardware) and provides for further limitations on exports of chipmaking machinery to China, with the goal of hindering the technological advancement of the local semiconductor industry.
If the bill is approved in the United States and also applied by the Netherlands, where Asml is headquartered, the company’s financial results could be affected: Asml expects that this year sales in China will represent 20 percent of the total.
THE WEIGHT OF ASML IN THE MICROCHIP INDUSTRY…
Asml holds an absolutely central position in the global semiconductor industry and, consequently, in the artificial intelligence supply chain. It is in fact the only company in the world capable of building equipment for extreme ultraviolet lithography (Euv), an extremely sophisticated process that, using very short wavelength light, allows for “printing” tiny circuits on microchips.
One of Asml’s largest clients is the Taiwanese company Tsmc, which manufactures (among others) Nvidia’s processors, the most advanced and sought-after by the artificial intelligence industry.
… AND ITS ROLE IN THE TECHNOLOGICAL CONFLICT BETWEEN AMERICA AND CHINA
Asml’s machinery has already been subject to American trade restrictions for years: Euv systems, in fact, have never been exported to China. However, the company also produces less sophisticated equipment, such as those for deep ultraviolet lithography (Duv). Some of these machines have obtained licenses for sale in the Chinese market. But the American Match Act aims to stop even this trade, prohibiting the export of Duv technologies to China.
WHAT WILL BE THE ECONOMIC IMPACT FOR ASML?
At the moment, it is unclear whether the Match Act will ban the sale of all Duv machinery in China, or only certain models; consequently, it is also difficult to predict to what extent the law will impact Asml’s financial results, whose shares are currently sharply recovering.
Ben Barringer, an analyst at Quilter Cheviot, told Cnbc that Asml’s older lithography models represent 10-15 percent of total sales; within this segment, China’s share is 50 percent.
In 2025, despite numerous existing restrictions, China was Asml’s single largest market: it accounted for over 30 percent of total sales. In 2026, its share is expected to drop to 20 percent, according to the company’s forecasts. But it could decrease even more if the American Match Act proves particularly restrictive: Chinese chipmakers, in fact, not only lack alternatives to Asml’s Euv systems, but also have few options to replace its Duv machinery.
