ASML shares fall nearly 5% on risk of new US restrictions on business with China

Shares of ASML, a Dutch manufacturer of chip manufacturing equipment, fell by almost 5% in Amsterdam on Tuesday, April 7. Investors after a long weekend on the European stock exchanges reacted to the bill in the U.S., suggesting a significant expansion of export controls against China - the largest market for ASML.

The price of ASML shares on trades in Amsterdam fell to $1106 - it is 4.7% less than the last closing price (on Thursday, April 2). There were no trades on April 3 and 6 in Europe because of Easter.

A group of U.S. lawmakers on April 2 introduced a bill on "Multilateral Approval of Technology Controls for Hardware" (MATCH for short), which would impose new restrictions on shipments of advanced chip-making machines to China. China is ASML's largest market, accounting for 33% of the company's revenue in 2025. In 2026, the company expects this share to drop to 20%.

ASML declined to comment to Reuters. The Dutch government said it could not comment on proposals to change legislation in the United States, the agency reports.

If the law is passed in the United States and supported by the Netherlands, the list of restrictions for ASML will expand for the first time since September 2024, Reuters writes, citing analysts. In particular, sales and service of immersion DUV lithography systems for Chinese customers may be blocked. ASML is the dominant manufacturer of such tools used to create chips, although the company faces competition from Japan's Nikon and China's SMEE, Reuters writes.

"We rate this prospect [of the law's passage] negatively," Citi analysts emphasized in the agency's statement.

At the same time, analysts are divided on the extent of financial damage to ASML. Degroof Petercam analyst Michael Rog believes that the tightening of rules will lead to a decrease in the company's sales by only a few percent. Meanwhile, JPMorgan strategist Sandeep Deshpande gives a more pessimistic outlook, allowing for a drop in earnings per share (EPS) of up to 10 percent. He notes that while other regions where ASML has a presence will begin to ramp up capacity, this will only partially offset losses in the Chinese market. According to Deshpande, the global market as a whole will take the brunt of the blow, as the current capacity shortage could worsen significantly under the new bans.

Despite Tuesday's drop, ASML stock is still 26% more expensive than it was worth at the start of 2026.

Most analysts confidently recommend buying the company's securities: they have 36 Buy and Overweight ratings versus five Hold and three Underweight ("below market," consistent with a sell recommendation), according to FactSet.

This article was AI-translated and verified by a human editor