"Europe's tech darling ASML has warned Chinese demand for its chipmaking kit will plummet next year, as Beijing doubles down on home-grown alternatives in response to Uncle Sam's export restrictions and trade war shenanigans. The Dutch firm remains bullish overall, pointing to continued momentum around AI investments driving demand for more advanced logic and memory from the chip companies that snap up its lithography machines."
""We expect China customer demand, and therefore our China total net sales in 2026 to decline significantly compared to our very strong business there in 2024 and 2025," said chief executive Christophe Fouquet. At one point last year, the Middle Kingdom was generating almost half ASML's sales, as China-based chipmakers rushed to get their orders in for new machinery before anticipated US export restrictions landed."
ASML forecasts a significant decline in China customer demand and China total net sales in 2026 after very strong business in 2024 and 2025. The company remains optimistic overall because AI investments are driving demand for more advanced logic and memory, sustaining interest in its lithography machines. ASML remains the only supplier of EUV photolithography equipment, but EUV sales to China have been barred. New US restrictions have extended to some DUV gear and pressured withdrawal of maintenance services. In response, China is accelerating development of domestic lithography equipment, with SMIC testing a homegrown DUV machine, and pushing for local hardware in other product lines.
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