China has begun manufacturing domestically developed immersion deep ultraviolet (DUV) lithography machines, a key chipmaking tool long dominated by Dutch supplier ASML, The Information reported on Monday.
The machines are expected to be delivered this year to leading Chinese chipmakers, including Semiconductor Manufacturing International Corp, Hua Hong Semiconductor and ChangXin Memory Technologies, the report said, citing people familiar with the matter.
ASML shares dropped 4.6% after the report.
Key details from the report:
The people did not identify the state-backed manufacturer due to the sensitivity of the matter.
The breakthrough could eventually challenge ASML in China, but the system still lags on performance and reliability and needs further testing before mass production, leaving the Dutch company's advantages intact for now.
Production will be limited initially, with about five DUV machines this year and roughly 20 in 2027.
Immersion DUV machines, which print circuit patterns onto silicon wafers, are the most advanced lithography tools available to Chinese chipmakers after restrictions cut off access to extreme ultraviolet lithography (EUV) systems.
China is also developing a domestic EUV machine, though it remains at the prototype stage.
The technology could give Chinese chipmakers an alternative source of critical equipment as the U.S. considers tighter restrictions on foreign lithography tool exports and servicing in China.
