According to Bloomberg, U.S. Commerce Secretary Howard Lutnick has raised concerns in recent meetings with senior ASML executives that one of the Dutch chipmaker’s extreme ultraviolet (EUV) lithography machines—the only tools on Earth capable of printing the most advanced semiconductor patterns—may have ended up in China. Such a transfer would represent a major breach of export controls that have prohibited ASML from selling EUV systems to China since the first Trump administration. This is a serious allegation. Senior administration officials told Bloomberg they possess evidence that ASML shipped EUV-related components and transport equipment to China, though they have repeatedly declined to show this evidence—either to Bloomberg or, apparently, to ASML itself. The company maintains that no such machine exists in China and never has. The Commerce Department did not respond to Bloomberg’s inquiries about whether it has proof of an actual EUV system on Chinese soil.

You might think this is irrelevant if you’re outside the chip industry, but it’s not. ASML is a Dutch company most people have never heard of, yet it is, by a wide margin, the most important company in the global AI buildout—excluding Nvidia or the hyperscalers. It produces the only machines on the planet capable of EUV lithography, the process of printing the microscopic circuit patterns that define the most advanced chips. Every cutting-edge processor made by TSMC, the foundry behind Nvidia’s and Apple’s chips, relies on ASML tools that took the company roughly two decades and untold billions to develop. There is currently no second supplier. This monopoly has made ASML Europe’s most valuable public company, with a market capitalization trading near $700 billion as of this week, up sharply over the past year due to insatiable AI-driven chip demand. That scale is precisely why the China question matters so much. If even one EUV machine made it into Chinese hands, it would represent one of the most consequential breaches of the export-control regime the U.S. has built over the past several years to keep advanced AI capability out of Beijing’s military and industrial base.

I sat down with ASML CEO Christophe Fouquet six weeks ago, well before this story broke, and asked him directly about the China question. Fouquet told me ASML tracks every machine it has ever shipped—they are either in active use with monitored customers or have been dismantled and returned to the company. He said the firm built an internal firewall years ago: employees who can access EUV technology, documentation, and training are walled off from those who cannot, and ASML’s China-based staff sit on the wrong side of that wall by design. He argued that the only reason ASML could build an EUV machine was that 80% of it already existed from decades of prior knowledge, and solving the one genuinely new problem—generating EUV light itself—took 20 years on its own. His broader point seemed to be that you cannot reverse-engineer a machine you have never had, and nobody in China has had one. There is also a simpler commercial logic that cuts against the idea that ASML would risk its export license to quietly arm a Chinese customer. ASML does sell older-generation deep ultraviolet (DUV) tools to China—gear it first shipped a decade ago—but Fouquet framed that explicitly as a protective calculation, not a loophole. The idea, he suggested, is to maintain enough of a generational gap so customers can still do business without manufacturing their own future competitor. ASML expects roughly 20% of its 2026 revenue to come from already-permitted sales to China. Risking the EUV ban entirely would put that revenue—and the company’s standing as the most valuable monopoly in European industry—on the line over a single illegal sale.

None of this proves the allegations are false. The government has not yet made its evidence public, and it is worth withholding judgment until it does. The Commerce Department, under Lutnick’s leadership, agreed late last year to put up to $150 million of taxpayer money into xLight, a startup developing a next-generation light-source technology that has been described as a long-term challenge to the core of ASML’s EUV monopoly. xLight’s own CEO told me last year that the company sees itself as a future partner to ASML, not a rival, building hardware meant to plug into ASML’s machines rather than replace them. When I put that framing to Fouquet in May, he was polite about it but unconvinced; ASML, he made clear, does not see itself as needing xLight’s technology to maintain its lead. Does that have anything to do with why Lutnick is suddenly pressing ASML on EUV? Nothing public connects the two. It could be entirely unrelated. But a federal official scrutinizing a monopoly while his own agency has money riding on a startup angling to improve that monopoly’s core technology is worth examining.

xLight is not the only outside bet on the future of lithography. Peter Thiel—who has his own long-running ties to Trump’s political orbit—has backed Substrate, a separate startup explicitly pursuing its own EUV-rival technology, with ambitions to compete with ASML more directly than xLight says it intends to. As Bloomberg notes, a bipartisan bill moving through Congress would go much further than EUV—it calls for an effective ban on all of ASML’s deep ultraviolet (DUV) shipments to China, the less advanced lithography tools that account for roughly a fifth of the company’s expected 2026 revenue. The bill cleared a key committee in April, and the Trump administration has not taken a formal position on it. Pictured above: ASML CEO Christophe Fouquet.