A Shanghai state-linked firm achieved mass production of DUV lithography machines, triggering a 55 billion euro market value loss for ASML with shares dropping over 5% in late July 2026. Analysts argue the technology gap remains wide, as domestic DUV machines are legacy products compared to ASML’s flagship EUV systems required for cutting-edge AI chips. ASML’s China revenue exposure is expected to fall from 33% in 2025 to around 20% in 2026 due to US and Dutch export controls, not because of the Shanghai milestone. ASML maintains a de facto monopoly on EUV lithography at commercial scale, serving TSMC, Samsung, and Intel with no credible alternative supplier available.
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