US claims ASML's EUV lithography machines reached China, company denies export breach

The US says ASML's top chip tool may be in China. ASML says it isn't

According to Bloomberg, U.S. Commerce Secretary Howard Lutnick has, in a series of recent meetings, told senior ASML executives he's concerned that one of the Dutch chipmaker's extreme ultraviolet lithography machines -- the EUV systems that are the only tools on Earth capable of printing the most advanced semiconductor patterns -- may have ended up in China. That would be a major breach of export controls that have barred ASML from selling EUV to China since the first Trump administration. It's a serious claim. Senior administration officials told Bloomberg they have evidence that ASML shipped EUV-related components and transport equipment to China, though they've declined, repeatedly, to show it -- to Bloomberg or, apparently, to ASML itself. The company says no such machine exists in China and has never existed there. The Commerce Department didn't respond to Bloomberg's questions about whether it has evidence of an actual EUV system on Chinese soil. You might think this isn't worth paying attention to if you're outside the chip industry, but it is. ASML is a Dutch company most people have never heard of, but it is, by a wide margin, the most important company in the global AI buildout that isn't named Nvidia or one of the hyperscalers. It makes the only machines on the planet capable of EUV lithography -- the process of printing the microscopic circuit patterns that define the most advanced chips. Every cutting-edge processor made by TSMC, the foundry behind Nvidia's and Apple's chips, depends on ASML tools that took the company roughly two decades and untold billions to develop. There is, at present, no second supplier. That monopoly has made ASML Europe's most valuable public company, with a market capitalization that has been trading in the neighborhood of $700 billion as of this week, up sharply over the past year on the back of insatiable AI-driven chip demand. That scale is exactly why the China question matters so much. If even one EUV machine made it into Chinese hands, it would represent one of the most consequential breaches of the export-control regime the U.S. has built over the past several years to keep advanced AI capability out of Beijing's military and industrial base. I sat down with ASML CEO Christophe Fouquet six weeks ago, well before this story broke, and asked him directly about the China question. Fouquet told me ASML tracks every machine it has ever shipped -- they're either in active use with monitored customers or have been dismantled and returned to the company. He said the firm built an internal firewall years ago: employees who can access EUV technology, documentation, and training are walled off from those who can't, and ASML's China-based staff sit on the wrong side of that wall by design. He argued the only reason ASML could build an EUV machine at all was that 80% of it already existed from decades of prior knowledge, and that solving the one genuinely new problem -- generating EUV light itself -- took 20 years on its own. His broader point seemed to be that you can't reverse-engineer a machine you've never had, and nobody in China has had one. There's also a simpler commercial logic that cuts against the idea that ASML would risk its export license to quietly arm a Chinese customer. ASML does sell older-generation deep ultraviolet tools to China -- gear it first shipped a decade ago -- but Fouquet framed that explicitly as a protective calculation, not a loophole. The idea, he suggested, is that it keeps enough of a generational gap that customers can still do business -- but without manufacturing its own future competitor. ASML expects roughly 20% of its 2026 revenue to come from already-permitted sales to China. Risking the EUV ban entirely would put that revenue, and the company's standing as the most valuable monopoly in European industry, on the line over a single illegal sale. None of this proves the allegations are false. The government hasn't yet made its evidence public, and it's worth withholding judgment until it does. The Commerce Department, under Lutnick's leadership, agreed late last year to put up to $150 million of taxpayer money into xLight, a startup developing a next-generation light-source technology that's been written about as a long-term challenge to the core of ASML's EUV monopoly. xLight's own CEO told me last year that the company sees itself as a future partner to ASML, not a rival, building hardware meant to plug into ASML's machines rather than replace them. When I put that framing to Fouquet in May, he was polite about it but unconvinced; ASML, he made clear, doesn't see itself as needing xLight's technology to keep its lead. Does that have anything to do with why Lutnick is suddenly pressing ASML on EUV? Nothing public connects the two. It could be entirely unrelated. But a federal official scrutinizing a monopoly while his own agency has money riding on a startup angling to improve that monopoly's core technology is worth examining. xLight isn't the only outside bet on the future of lithography. Peter Thiel -- who has his own long-running ties to Trump's political orbit -- has backed Substrate, a separate startup explicitly pursuing its own EUV-rival technology, with ambitions to compete with ASML more directly than xLight says it intends to. As Bloomberg notes, a bipartisan bill moving through Congress would go much further than EUV -- it calls for an effective ban on all of ASML's deep ultraviolet (DUV) shipments to China, the less advanced lithography tools that account for roughly a fifth of the company's expected 2026 revenue. The bill cleared a key committee in April, and the Trump administration hasn't taken a formal position on it. Pictured above: ASML CEO Christophe Fouquet

ASML Shares Slip on Report of U.S. Concern That China Has Its Tech

ASML shares fell following a report that the Trump administration expressed concern that one of the Dutch company's high-end lithography machines is being used in China despite export restrictions. Shares in Europe's most valuable company slid as much as 2.6% in morning trade before paring losses to fall 0.7%. That said, the stock--which makes up close to 8% of the Europe-wide Stoxx 600 index--is up around 80% so far this year. U.S. Commerce Secretary Howard Lutnick voiced concern to leaders at the Amsterdam-listed company that one of its extreme ultraviolet lithography machines had entered China, violating U.S.-led export restrictions, Bloomberg reported, citing unnamed sources. "ASML has never shipped an EUV machine to China nor have we shipped to China any component, module or equipment specially designed to be used in an EUV machine," the company said in a statement. ASML has previously refuted suggestions it failed to comply with export controls. ASML is the world's only supplier of the equipment necessary for manufacturing cutting-edge chips at scale, placing it at the center of the global artificial-intelligence arms race. Its lithography machines--which are tightly controlled and require close supervision by ASML employees--use high-powered lasers to print microscopic patterns onto silicon discs. The company counts Taiwan Semiconductor Manufacturing Company and Samsung Electronics among its main clients. "These are very difficult things to smuggle," Ben Barringer, head of technology research at investment manager Quilter Cheviot, said. ASML said that the company regularly talks to government leaders across the globe. "We recognize the national security considerations behind export control regulations in the U.S. and the Netherlands," the statement said. ASML is accustomed to diplomatic tangles because of the importance of its equipment for leading-edge chips, the analyst said, a situation that means the company can't favor one country over another. "It's got to maintain relationships with the Chinese. It's not just about siding with the U.S," Barringer said. The Bloomberg report will likely put pressure on ASML given the sensitivity around the U.S.-China AI arms race, Tickmill market strategist Patrick Munnelly said. "This matters beyond ASML itself because the global equity rally has been heavily dependent on the chip complex. Any renewed US-China technology restriction risk would cut directly against the AI-led optimism supporting markets," Munnelly wrote in a note to clients.