US to unveil more chip restrictions on China, but may exempt key firms

Any exemption would be a relief for the industry, as compliance with export restrictions presents a complex challenge. Many impacted companies are significant contributors to their respective economies, and China is their major market.

“On one hand, they have to remain loyal to the US government, but at the same time, they take a revenue hit by not exporting to China,” said Neil Shah, partner and co-founder at Counterpoint Research. “On the other hand, many semiconductor companies, from equipment manufacturers to fab operators to chipmakers, used to derive 25-45% of their revenue from China, given the country’s sheer scale and ambitions.”

ASML, the world’s leading supplier of semiconductor manufacturing equipment, had its former CEO reportedly say that he had attempted to prevent the tightening of export restrictions.