ASML's China Revenue Hits 20% Amid U.S. Export Control Push

Balancing act for Europe's chip equipment leader

ASML, the Dutch semiconductor equipment manufacturer essential to advanced chip production, expects China to contribute approximately 20% of its total revenue in 2026, according to CFO Roger Dassen. The figure represents both a significant revenue stream and a growing political challenge as U.S. lawmakers push for tighter export restrictions on chipmaking technology.

The company generated €2.9 billion ($3.3 billion) in Chinese sales during the first half of 2026, representing roughly 16% of total revenue, according to details first reported by CNBC. Dassen's full-year projection suggests Chinese revenue will accelerate in the second half of the year, driven primarily by logic chip production serving domestic demand.

China ranked as ASML's third-largest market by revenue in the first half of 2026, trailing only South Korea and Taiwan but generating nearly €1 billion more than U.S. sales.

Export restrictions already in place

ASML currently does not ship its most advanced extreme ultraviolet (EUV) lithography machines to China due to existing export controls implemented after years of pressure from Western governments. However, the company continues selling less advanced deep ultraviolet (DUV) lithography systems to Chinese customers—equipment that can produce older-generation semiconductors.

Chinese semiconductor equipment spending is projected to grow approximately 10% annually over the next 24 months, according to David Dai, senior analyst at Bernstein.

Washington wants more restrictions

U.S. lawmakers are now targeting even these less advanced systems. Earlier in 2026, members of Congress petitioned Secretary of State Marco Rubio and Commerce Secretary Howard Lutnick for stronger controls on chipmaking tools. In April, legislators introduced the MATCH Act (Multilateral Alignment of Technology Controls on Hardware), which could ban Chinese companies from purchasing ASML's DUV machines entirely.

ASML shares declined when the bill was introduced. "The proposed US MATCH Act squarely aims at denying most chip-making technology to China, which could significantly impact ASML's orderbook in the years to come," Sandeep Rao, researcher at Leverage Shares, told CNBC.

Why it matters

ASML's position illustrates the collision between commercial interests and national security policy in the AI era. The company holds a monopoly on EUV lithography machines required for cutting-edge chip manufacturing, making it indispensable to the global semiconductor supply chain. Yet that same strategic importance makes its sales a focal point in U.S.-China technology competition. How ASML navigates this tension—and whether new restrictions become law—will shape both the company's financial trajectory and the broader semiconductor industry's geopolitical landscape.

"China remains to be an important market for ASML, while the Dutch supplier looks to walk a geopolitical tightrope between Beijing and Washington," Neil Shah, VP research at Counterpoint, told CNBC.

The company reported stronger-than-expected quarterly results this week and raised its guidance for the second time in 2026, driven by customer demand for AI chip production capacity. Despite the strong earnings, ASML shares remained largely flat—a pattern emerging among AI-related companies this year.

These details were first reported by CNBC.