Hilo Research河洛投研
Quick Summary
Covering the latest research from top Wall Street investment banks

China WFE imports recovered in June, while ASML's China demand is still viewed as resilient

Institution
Bernstein
Date
2026-07-21
Authors
Qingyuan Lin, Ph.D., Stacy A. Rasgon, Ph.D., David Dai, CFA, Kai Zhang, Francis Ma, Alrick Shaw, Arpad von Nemes, Carmine Milano, CFA, Juho Hwang, Jack Lin
Company
ASML HOLDING NV
Ticker
ASML.US
Industry
Semiconductor Equipment & Materials
Rating
Outperform
BullishLow confidenceThe report believes China's WFE imports recovered significantly month over month in June despite remaining down year over year year-to-date; it maintains an Outperform rating and a €2,500 target price for ASML, and believes Chinese demand will continue to be supported by capacity expansion in advanced logic and other areas over the next several years.
AuthorsQingyuan Lin, Ph.D., Stacy A. Rasgon, Ph.D., David Dai, CFA, Kai Zhang, Francis Ma, Alrick Shaw, Arpad von Nemes, Carmine Milano, CFA, Juho Hwang, Jack Lin
Target priceEUR 2,500.00
CoverageUnited States、Asia-Pacific、Europe
Asset classesEquity
Business segmentsWafer Fabrication Equipment、Lithography、Dry Etch、Deposition、Process Control、Cleaning、Semiconductor Capital Equipment
Research firm divisions/subsidiariesBernstein（Other）

AI summary card

China WFE imports recovered in June, while ASML's China demand is still viewed as resilient

Bernstein tracks China's customs data on WFE imports, noting that June 2026 imports totaled $3.4bn, up 57% month over month and 1% year over year, while year-to-date imports were down 10% year over year; however, imports are expected to continue recovering in the second half, driven by memory WFE.

ASML is rated Outperform with a EUR 2,500.00 target price; the report also lists ratings or investment views on multiple companies including NAURA, AMEC, Piotech, Tokyo Electron, Kokusai, Advantest, AMAT, LRCX, and KLAC.
Semiconductor equipmentWFE importsChina demandLithography equipmentASMLRegression analysis
  • China's WFE imports totaled $3.4bn in June, slightly above the 2025 monthly average of $3.2bn, up 57% month over month and 1% year over year.
  • China's year-to-date 2026 imports totaled $16bn, down 10% year over year, mainly dragged down by lithography, which fell 18% year over year year-to-date, and dry etch, which fell 14%.
  • June lithography imports were EUR 697Mn, up 196% month over month and 8% year over year, but Q2 2026 imports were still down 24% quarter over quarter and 9% year over year.
  • ASML's regression model estimates Q2 China sales at EUR 1.02Bn, close to the actual reported EUR 919Mn; the company disclosed that China systems sales accounted for 14%.
  • The report maintains an Outperform rating on ASML with a EUR 2,500.00 target price, implying 64% upside.

Report interpretation

Overview

This report is Bernstein's monthly tracking of China's June 2026 WFE import data, sourced from China Customs and analyzed by equipment type, import origin, and the China revenue exposure of major global semiconductor equipment companies. The report's core conclusion is that monthly imports in June recovered to roughly flat year over year and grew significantly month over month, but year-to-date performance remains dragged down by weak lithography and dry etch; imports are expected to continue recovering in the second half as memory-related WFE imports strengthen.

Core views

The report believes China's importance in the global WFE market continues to rise, and that import data can be used to observe demand sustainability and overseas equipment vendors' China revenue trends. June WFE imports were $3.4bn, up 57% month over month and 1% year over year; year-to-date imports were $16bn, down 10% year over year. Lithography imports recovered from their April low to reach EUR 697Mn in June, but still declined in Q2. By origin, the combined share of the United States, Malaysia, and Singapore rose to 43% year-to-date, while the Netherlands accounted for 18% and Japan 21%. At the company level, although ASML's China revenue exposure is expected to decline from 33% in FY25 to approximately 20% in FY26, the report still judges Chinese demand to remain robust over the next several years.

Analysis framework

The report uses monthly China Customs WFE import data, broken down by equipment type and import origin, and applies regression or correlation analysis between the relevant import data and China revenue reported by companies including ASML, LRCX, AMAT, KLAC, TEL, Kokusai, Screen, and Advantest to estimate quarterly changes in China revenue and revenue exposure.

Methodology notes

  • Data trackingChina Customs WFE imports tracking

    Monthly tracking of China's WFE import value, equipment types, and origin regions

    Uses monthly WFE import data from the China Customs statistics website, covering equipment types such as lithography, deposition, dry etch, process control, and cleaning, while observing changes in shares by origin region.

  • Quantitative regressionRegression of import data against companies' China revenue

    Using import data to estimate equipment vendors' quarterly China revenue

    The report regresses specific equipment or origin import data against companies' disclosed China revenue using two-month or three-month correlations, evaluates predictive power with R², and uses the results to estimate quarter-over-quarter revenue changes and China revenue exposure.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

  • ASML HOLDING NV
    Key covered company; China lithography imports are highly correlated with its China systems revenue
    Strengths
    The regression of lithography import data against ASML China systems revenue produced an R² of 0.95; the company plans to expand DUV capacity by 30% over the next two years, which the report believes reinforces the view that Chinese demand is resilient.
    Weaknesses
    Q2 China systems sales were EUR 919Mn, or 14%, below the FY25 peak; the company expects FY26 China revenue to account for approximately 20% of total revenue, down from 33% in FY25.
    Comparison
    The regression estimated Q2 China sales at EUR 1.02Bn, slightly above the actual reported EUR 919Mn but directionally consistent.
    Risks
    Further decline in China revenue exposure, export controls, lithography supply shortages, or weaker-than-expected China WFE demand.
  • LRCX
    China-related import data are used to estimate its Jun-Q China revenue
    Strengths
    The three-month correlation has an R² of approximately 0.85, indicating some predictive power.
    Weaknesses
    The model indicates that Jun-Q China revenue may decline approximately 24% quarter over quarter, with China exposure of approximately 23%.
    Comparison
    Management previously indicated that China exposure would decline sequentially in the June quarter, consistent with the model's direction.
    Risks
    Slower China WFE demand, changes in customers' capital expenditure timing, and weak dry etch-related imports.
  • AMAT
    China-related import data are used to estimate its Jul-Q China revenue
    Strengths
    The two-month correlation has an R² of approximately 0.81, and the model indicates that Jul-Q China revenue may increase approximately 29% quarter over quarter.
    Weaknesses
    Management has not provided guidance for China revenue in the July quarter, limiting visibility.
    Comparison
    The model implies China revenue exposure of approximately 30%, above approximately 26% in Apr-Q.
    Risks
    China business may be flat to slightly up for the full year; a subsequent decline in imports could reduce the estimate.
  • KLAC
    China-related import data are used to estimate its Jun-Q China revenue
    Strengths
    The three-month correlation has an R² of approximately 0.91, and the model indicates that Jun-Q China revenue may increase approximately 23% quarter over quarter.
    Weaknesses
    Management has not provided guidance on China revenue exposure for the current quarter.
    Comparison
    The model implies China revenue exposure of approximately 28%, above approximately 24% in Mar-Q.
    Risks
    China WFE growth could lag global WFE growth, potentially limiting upside.
  • Tokyo Electron
    Japanese semiconductor equipment imports are correlated with TEL China SPE revenue
    Strengths
    The model indicates that China revenue may increase 7% year over year and 19% quarter over quarter, implying China revenue exposure of 30%.
    Weaknesses
    The report states that the three-month correlation has an R² of approximately 0.84, indicating relatively limited predictive power.
    Comparison
    The sequential growth rate may exceed the market consensus expectation of 9%.
    Risks
    Declining import share of Japanese equipment or changes in the structure of China demand.

Key data

  • China WFE imports in June 2026$3.4bnUp 57% month over month and 1% year over year, slightly above the 2025 monthly average of $3.2bn.
  • China WFE imports year-to-date 2026$16bnDown 10% year over year, mainly dragged down by lithography and dry etch.
  • China lithography imports year-to-date 2026$2.98bnDown 18% year over year, the primary drag on weak year-to-date performance.
  • China lithography imports in June 2026EUR 697MnUp 196% month over month and 8% year over year.
  • Actual ASML Q2 China systems salesEUR 919MnAccounted for 14% of total systems sales, a relatively low level since Q1 2023.
  • Regression estimate of ASML Q2 China salesEUR 1.02BnThe model's R² was 0.95, and the estimate was close to the actual reported figure.
  • Import share of the United States + Malaysia + Singapore43%The year-to-date 2026 share was above 35% in 2025 and 33% in 2024.
  • ASML target price and upsideEUR 2,500.00; 64% upsideBernstein rates ASML Outperform.

Impact & implications

For investors, the June data indicate that China's WFE imports are recovering from their previous lows, but the recovery is uneven: lithography improved significantly in the month, while deposition and dry etch continued to weigh on year-over-year performance. For ASML, the short-term decline in China revenue exposure has largely been confirmed by company guidance and actual disclosures, but the report believes capacity expansion in advanced logic and other areas will support Chinese demand over the next several years. For other equipment vendors, regression results suggest that AMAT, KLAC, TEL, and Kokusai may see quarter-over-quarter improvements in China revenue, while LRCX, Screen, and Advantest may face varying degrees of sequential pressure.

Risks

  • China WFE imports may recover less than expected, particularly if demand for memory-related equipment fails to strengthen in the second half.
  • Export controls, supply constraints, or geopolitical factors may continue to affect imports of lithography and other critical equipment.
  • Regression models are based on historical correlations; forecast errors may widen if companies' shipping locations, revenue recognition timing, or supply-chain structures change.
  • Declining China revenue exposure may weigh on near-term growth expectations for ASML and other overseas equipment vendors.
  • Accelerating domestic substitution may reduce some overseas equipment vendors' long-term market share in China.

What to watch

  • Whether China's WFE imports continue to recover in the second half of 2026, driven by memory demand.
  • Whether lithography imports maintain their improvement after the April low, and whether the Netherlands' share remains elevated.
  • Whether the continued rise in the combined import share of the United States, Malaysia, and Singapore reflects supply-chain migration by U.S. equipment vendors.
  • Whether ASML's FY26 China revenue exposure approaches the company's guidance of 20%.
  • Whether subsequent reports from AMAT, KLAC, TEL, Kokusai, and other companies validate the regression model estimates for China revenue.
© 2026 Hilo ResearchAbout UsPrivacy PolicyTerms of Service
Zhejiang ICP No. 2022035445-5
Disclaimer: Market data, charts, indicators, research views, and other information provided on this website are intended solely for information display, research communication, and educational reference. They should not be regarded as personalized investment advice, securities recommendations, trading instructions, solicitations, or guarantees of return. While we strive to improve the reliability of our data and content, such information may still be subject to delays, errors, incompleteness, or untimely updates due to source differences, methodological limitations, system processing, or market volatility. Users should exercise independent judgment based on their own circumstances and bear all risks and responsibilities arising from the use of this website.

Settings

Sign in to view recent logins