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U.S.-China AI feud sees ASML walk tightrope between sales and geopolitics
ASML has raised its sales guidance following higher-than-expected earnings driven by AI chip demand. However, the company is navigating a delicate situation with U.S. lawmakers who are proposing to restrict even the less advanced DUV lithography machines to China. While Chinese sales amounted to 2.9 billion euros, representing a critical revenue source, potential legislation raises concerns about future orders from this key market.
MonitorConfidence: MediumShort term horizonGeopolitical risk: High
Published 17 Jul 2026, 11:55 UTC2 min read
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Summary
TL;DR
- ASML's quarterly results exceeded expectations due to increased demand for AI chips.
- Chinese market sales projected to account for 20% of ASML's net sales in 2026.
- U.S. lawmakers propose the MATCH Act to restrict chipmaking technology to China.
- ASML's sales to China could face further restrictions despite strong current performance.
- China now ranks as ASML's third-largest market for revenue.
Interesting facts
- ASML's stock remained relatively flat despite strong earnings.
- Chinese semiconductor equipment spending is expected to grow by 10% annually for the next two years.