ASML CEO Christophe Fouquet with a Lego model of the company's EUV machine.
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Europe's most valuable company faces a new threat after China reportedly took a step toward matching its unique tech that's crucial to the global chip market.Shares in ASML, the only company on the planet capable of mass producing the extreme ultraviolet lithography machines used to build cutting-edge chips, slid nearly 5% in premarket trading on Tuesday after reports that a Chinese rival had made a breakthrough.The Information and Reuters reported on Monday and Tuesday that a Chinese state-backed company had begun manufacturing immersion deep-ultraviolet (DUV) lithography machines.That represents a notable threat to ASML, which dominates the market for DUV machines and has seen a surge in orders in recent months as the AI boom has supercharged demand.Shares of ASML closed nearly 6% down on Monday. The DUV machines being built by China are at an early stage and do not yet match ASML's technology, Reuters and The Information both reported, citing sources familiar with the matter.China reportedly plans to manufacture five DUV machines this year and roughly 20 next year, well behind the 130 comparable machines ASML expects to ship this year.However, the development is the latest twist in China's yearslong attempt to match ASML's technology and catch up with the West's ability to build advanced chips, which is a critical bottleneck in the race to train and deploy frontier AI models.
