ASML shares fell sharply in European trading on Monday, pressured by reports that China is making significant strides in developing its own semiconductor manufacturing technology.
The sell-off reflects growing investor concern that the Dutch lithography equipment maker’s long-standing monopoly on extreme ultraviolet (EUV) machines could face erosion from domestic Chinese alternatives.
The market reaction was triggered by a report from The Information, cited by Polish business outlet Puls Biznesu, which claimed that Chinese firms are beginning to produce their own lithography tools capable of challenging Western dominance.
While the specific technical capabilities of these domestic machines were not detailed in the initial reports, the mere suggestion of a viable alternative to ASML’s high-end equipment was enough to spook investors.
ASML has long been the sole supplier of EUV lithography systems, which are critical for producing the most advanced logic chips used in artificial intelligence and high-performance computing.
The company’s business model has relied heavily on export controls and technological lead times to maintain its edge.