ASML (ASML.AS), a manufacturer of computer chip equipment, announced that the Dutch government had partially revoked an export permit for the supply of certain of its devices to China. This news caused a decline in the company’s shares and drew anger from Beijing.
The company claimed that the government had revoked an export license for a few machines in a model range that had needed a Dutch license since September 2023 because to pressure from the US administration to undermine China’s capacity to produce its own chips.
According to ASML, sales to “a limited number of advanced production facilities” will be impacted by “further clarification of the scope and impact” of more recent U.S. regulations.
On the first trading day of 2024, ASML shares dropped 2.5% to settle at 664.3 euros ($728.14).
China has been ASML’s third-largest market in recent years, after South Korea and Taiwan, but it surpassed all other markets in the third quarter of 2023, accounting for 46% of the company’s revenue.
Chinese clients were informed that, as of January 1, 2024, they would not be receiving licenses for the NXT:2050i and NXT:2100i systems that are the subject of the license revocation.
The foreign ministry spokesperson Wang Wenbin called on the Netherlands “to protect the common interests of both countries and their companies, and maintain the stability of international supply chains” in response to Beijing’s criticism of the most recent action.
The emblem of ASML, a manufacturer of semiconductor equipment, is shown at its Shanghai stand during Semicon China.
At its stand at Semicon China, a trade show for the semiconductor industry, in Shanghai, China on June 29, 2023, is the logo of chip equipment manufacturer ASML. REUTERS/Nicoco Chan/File Photo Receives Rights to License Images
According to a spokesman for the Dutch foreign ministry, export license applicants are evaluated individually for reasons of national security on a Tuesday.
The market for lithography equipment, or big devices that employ light beams to assist print circuitry—a critical stage in the process of creating chips—is dominated by ASML, the biggest technological company in Europe.
Due to the Netherlands’ refusal to grant Chinese customers access to ASML’s two most sophisticated lithography machines, they will have to look into other options for obtaining comparable equipment and minimizing any potential production effects.
According to Randall, a chip analyst at consultancy Intralink with a base in Shanghai, “Chinese customers will have to continue finding ways to get these equipments, cope with lower yields and perhaps buy more equipment to achieve similar capacity goals.” Although ASML did not specify which clients were expected to receive the equipment, company disclosures list Semiconductor Manufacturing International Corporation (SMIC) (0981.HK) as one of its clients in China.
