Under US pressure, ASML already restricts Chinese clients from buying its more advanced extreme ultraviolet (EUV) lithography systems, which are used to produce the world’s most cutting-edge chips. ASML has a near monopoly on the machines.
Lithography tools are complex projection systems that are considered the most important equipment needed in the process of producing integrated circuits. China is considered years behind in this tech, and has so far struggled to close the gap with leading firms despite heavy government investment.
China imported 42 lithography systems in November for US$816.8 million, with companies in the Netherlands and Japan accounting for nearly the entire amount spent on such imports.
China’s imports of critical chip-making lithography systems from the Netherlands, in particular, surged 1,050 per cent in value that month. The Netherlands is the biggest exporter of lithography machines, almost all of which come from ASML – though the company does not have the same hold on the DUV market as on EUV.
China’s imports of Dutch chip-making equipment surged tenfold in November
China’s imports of Dutch chip-making equipment surged tenfold in November
A spokeswoman from ASML declined to comment on that timeline, but noted that it was unlikely that the company would receive new licences for the NXT:2050i and NXT:2100i DUV machines in 2024.
“In recent discussions with the US government, ASML has obtained further clarification of the scope and impact of the US export control regulations,” the equipment maker said in its Monday statement.
“ASML is fully committed to complying with all applicable laws and regulations, including export control legislation in the countries in which we operate,” it added.
In recent years, China has been ASML’s third-largest market after Taiwan and South Korea, but it jumped to first place in the third quarter of 2023, accounting for 46 per cent of sales. This was up from 24 per cent in the previous quarter and 8 per cent in the first quarter.
In an investor call the previous month, ASML CEO Peter Wennink said the company had fulfilled less than 50 per cent of Chinese clients’ orders in the previous two years, but shifting demand from other customers created an opportunity to fulfil more orders in the country.
In its most recent statement, ASML said it did not expect the licence revocation or the latest US export controls to have a material impact on its 2023 financial outlook, echoing similar sentiments expressed in its latest financial report.
