US Legislation Restricts ASML's Sales to China
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy NVDA?
Source: CNBC
- Sales Decline Expectation: ASML anticipates that its sales in China will drop to 20% of total revenue in 2023, down from 33% in 2025, indicating a significant negative impact from the proposed US restrictions.
- Legislative Impact Analysis: The proposed MATCH Act could ban ASML's deep ultraviolet (DUV) lithography machines, which represent 10%-15% of overall sales, with China accounting for about 50%, potentially leading to a 5% revenue hit for the company.
- Market Reaction: ASML's shares fell approximately 2.6% following the announcement of the proposal, reflecting investor concerns over the uncertainty and potential volatility in the market, particularly given the company's reliance on the Chinese market.
- Industry Dependency: Major Chinese chipmakers like Semiconductor Manufacturing International Co. (SMIC) and Hua Hong still depend on ASML's DUV tools for producing lower-end chips; if the new legislation is passed, it could severely disrupt China's semiconductor manufacturing capabilities, intensifying competition in the industry.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 178.100
Low
200.00
Averages
264.97
High
352.00
Current: 178.100
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is an artificial intelligence (AI) infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. Its segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing and networking platforms and AI solutions and software, and automotive platforms and autonomous and electric vehicle solutions, including software. The Graphics segment includes GeForce GPUs for gaming and personal computers (PCs), and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics. Its technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits (SDKs), and application programming interfaces (APIs). Its platforms address four markets, which include Data Center, Gaming, Professional Visualization, and Automotive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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