China begins domestic DUV lithography machine production

Shares of Dutch semiconductor equipment giant ASML fell sharply on Monday, July 27, 2026, following a report that a Chinese company has begun producing a key type of chipmaking machine domestically. The development represents a significant step in China's push for self-sufficiency in advanced manufacturing and could eventually challenge Western export controls designed to limit China's technological progress.

According to a report by The Information, a state-backed company in Shanghai has started manufacturing immersion deep ultraviolet (DUV) lithography machines. These tools are used to print intricate circuit patterns onto silicon wafers and are considered the workhorses for producing a wide range of advanced chips, from memory to automotive processors. The report, which did not name the manufacturer, stated the company plans to produce about five such machines this year and roughly 20 in 2027.

The machines are expected to be delivered to leading Chinese chipmakers, including Semiconductor Manufacturing International Corp (SMIC), Hua Hong Semiconductor, and ChangXin Memory Technologies (CXMT). The development comes as Chinese companies face increasing restrictions on...