A state-owned company from Shanghai has begun production of immersion DUV lithography machines—equipment critical for the manufacture of modern semiconductors. This was reported on July 27, 2026, by the publication The Information, citing two anonymous sources familiar with the program. According to them, the company plans to produce about five such machines in 2026 and approximately 20 in 2027, with the first shipments intended for Semiconductor Manufacturing International Corp (SMIC), Hua Hong Semiconductor, and ChangXin Memory Technologies (CXMT).
The following day, July 28, Reuters revealed the manufacturer's name: it turned out to be a little-known state-owned entity, Shanghai Aishengna Electronic Technology Group, registered in August 2023 with a capital of 7 billion yuan. Reportedly, the company united development teams from several Chinese firms, including the startup Shanghai Yuliangsheng Technology, which tested a DUV machine prototype back in 2025, as well as specialists from Shanghai Micro Electronics Equipment (SMEE).
Far from ASML's Level
A source familiar with the matter emphasized in a conversation with Reuters: Aishengna's machine will require additional testing and is still far from matching models by the Dutch company ASML—the world leader in lithography equipment manufacturing. Similar skepticism was expressed by JPMorgan Chase analysts, noting that producing a small number of deep ultraviolet (DUV) lithography machines is significantly different from manufacturing equipment suitable for large-scale production. According to them, mass production depends much more heavily on yield rates, alignment accuracy, throughput, and reliability over thousands of wafer processing cycles.
Experts interviewed by the South China Morning Post took a similar position: the publication cited the opinion of Paul Triolo, a partner at DGA-Albright Stonebridge Group, who pointed out that producing machines of such complexity that are commercially viable and can operate 24/7 year-round is an extremely difficult task. William Bavington, an analyst at Jefferies, recalled that previous reports of China's progress in immersion DUV lithography later turned out to be unreliable and suggested waiting for confirmation of the current claims by independent sources. In the opinion of the analysts interviewed, ASML's dominance in the lithography equipment market is not yet under threat.
A More Realistic Risk for ASML—Not China
Experts interviewed by the South China Morning Post added that a more serious threat to ASML might come not from the progress of Chinese developers, but from the possible passage of the MATCH Act in the United States, which could restrict the company's sales and servicing of its equipment abroad.
The fate of the new equipment will depend on whether Aishengna's ability to establish truly mass production of machines, not just single prototypes, is confirmed. For now, market participants agree that ASML's position in this segment remains strong.
AI Opinion
From the perspective of macroeconomic connections, the course of events looks less dramatic than the headlines: in the second quarter, China accounted for only 14% of ASML's net sales, about €6.6 billion, while the company's shares reacted to the news with a decline. The region remains a notable but not decisive source of revenue for the Dutch giant.
A historical pattern suggests caution in assessing timelines. A prototype of a Chinese EUV machine in Shenzhen was already generating ultraviolet radiation back in 2025 but never moved to producing working chips, and the path from a laboratory sample to a mass-produced product in Chinese practice has traditionally stretched over years. Whether Aishengna's machine will be an exception to this rule or another long-term project will only be shown by the actual delivery volume in 2027.
