Threat Out of China Creeps Up on ASML: Is the Dip in the Stock Worth Buying?
ASML shares fell after it was reported that a Chinese company is set to ship homegrown DUV machines.
Overview
Shares of ASML (NASDAQ: ASML) fell after technology publication The Information reported this week that an unnamed Chinese company backed by the Chinese government has begun manufacturing its own chip-making equipment. However, investors shouldn't be worried, as this is unlikely to hurt ASML's fortunes any time soon.
The machines reportedly being made in China are deep ultraviolet (DUV) lithography machines. This is an older technology used to manufacture older chips and the less critical components of advanced chips. DUV machines are also used to manufacture ordinary DRAM and flash memory. While ASML is a top supplier of DUV machines by a wide margin, it is not the only company that makes these machines. Japanese companies Nikon and Canon also supply them.
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Originally published at www.fool.com.