ASML Holding NV (NASDAQ:ASML) shares were unsurprisingly tossed lower in pre-market US trades when it emerged that the highly specialised lithographic machinery manufacturer for the semiconductor industry was slapped with export restrictions to the lucrative Chinese market.
Imposed by the Dutch government, the export restrictions follow similar sanctions imposed by the US government on Nvidia Corporation (NASDAQ:NVDA) and other microchip developers in a bid to curb China’s advancement of artificial intelligence (AI) technology.
Though ASML stated that “we do not expect the current revocation of our export licence or the latest US export control restrictions to have a material impact on our financial outlook for 2023”, the market was clearly unconvinced.
Chinese foreign ministry spokesman Wang Wenbin lashed out against the export controls on Tuesday, pleading with the Dutch authorities "to be impartial, respect market principles and the law, take practical actions to protect the common interests of both countries and their companies and maintain the stability of international supply chains".
Not all Chinese semiconductor manufacturers fall under the scope of the export controls, though it is unclear which do which do not.
ASML is practically unrivalled at the highest end of the semiconductor lithography sector, with a monopoly on extreme ultraviolet (EUV) lithographic machinery used to manufacture the most advanced microchips on the market.
A single lithographic machine has a purchase price of at least $200 million.
ASML shares were trading 3.7% lower at $756.92 in pre-market trades.