The U.S. has spent years trying to choke off China's access to advanced chipmaking technology. Yet one number from ASML Holding N.V. (ASML)'s latest earnings call suggests the world's biggest semiconductor equipment maker is still doing plenty of business there.
“We still look at China as approximately 20% of our total net sales,” said CFO Roger Dassen.
China accounted for roughly 20% of ASML's second-quarter revenue, a reminder that the chip war hasn't shut the country out of the semiconductor supply chain—it has simply changed what China is buying.
The Chip War Didn't End China's Spending
Most export controls targeting ASML have focused on its most advanced extreme ultraviolet (EUV) lithography systems, which are essential for manufacturing cutting-edge AI chips. Those machines remain off limits to Chinese customers.
But that's only part of ASML's business.
China continues to buy the company's deep ultraviolet (DUV) systems, which are used to manufacture mature-node semiconductors found in everything from automobiles and industrial equipment to smartphones and home appliances. As Beijing pushes to expand domestic chip production, demand for those tools has remained resilient despite tightening restrictions.
For investors, that's an important distinction. The chip war hasn't eliminated Chinese demand — it has redirected it.
Why The 20% Figure Matters
ASML has repeatedly cautioned that China's contribution could normalize over time as customers digest previous purchases and export rules evolve. Yet the latest quarter shows the market remains a meaningful revenue driver even after years of escalating trade tensions.
That resilience also arrives alongside another powerful demand engine: artificial intelligence.
Management said on Wednesday that the AI opportunity is proving larger than previously expected, with memory-related demand expected to surge this year. Together, the comments paint a picture of a company benefiting from two very different semiconductor cycles — leading-edge AI investment and continued spending on mature manufacturing capacity.
The Next Test For ASML
The bigger question isn't whether China remains important today. Investors already have that answer.
The real question is how long it stays that way.
Future export restrictions, changes in Chinese capital spending and the pace of domestic chip development will determine whether China remains a fifth of ASML's business or gradually becomes a smaller piece of the revenue mix.
For now, though, the latest earnings call delivered a clear message: despite years of geopolitical tension, China remains one of ASML's biggest customers. That's a reminder that the global semiconductor supply chain is proving harder to untangle than policymakers — or investors — might have expected.
