By Adam Clark
ASML stock was dropping early Tuesday. Investors are digesting a potential hit to the Dutch chipmaking machinery company from proposed new U.S. rules on exports to China.
ASML's Amsterdam-listed shares were down 4%, the first day of trading on the exchange since a bipartisan group of U.S. representatives introduced a bill to further restrict semiconductor manufacturing equipment sales to China. The company's U.S.-listed shares were down another 1% after dropping by as much on Monday.
The Multilateral Alignment of Technology Controls on Hardware (MATCH) Act, introduced Friday, seeks to close gaps in export controls and enforcement.
Most importantly for ASML, the Match Act would extend current bans on the sale of cutting-edge chipmaking equipment to include older tools or deep ultraviolet lithography systems. Those sales are expected to account for a low-teens percentage of ASML's equipment sales in 2026, according to Jefferies equity sales specialist William Beavington.
"While the extent to which these measures will be passed into law and the Dutch and Japanese governments will comply remains to be seen, the bill shows the intent of the US government and is likely to be an overhang on these stocks, especially ASML," Beavington wrote.
During ASML's fourth-quarter earnings call in January, the company said it expects Chinese sales to comprise only 20% of 2026 sales. However, it made a similar prediction for 2025 and eventually made a third of its sales to China last year.
ASML has been banned from exporting its most advanced technology, known as extreme ultraviolet, or EUV, lithography to China since 2019. However, attention was brought to sales of deep ultraviolet, or DUV, machines after analysts suggested China's Semiconductor Manufacturing International Corp. used that technology to produce an advanced chip for Huawei's smartphones.
Write to Adam Clark at adam.clark@barrons.com
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(END) Dow Jones Newswires
April 07, 2026 09:02 ET (13:02 GMT)
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