China’s debut of domestic lithography systems triggers a semiconductor sell-off, hitting AMD despite strong earnings and revenue growth.
Advanced Micro Devices (NASDAQ:AMD) fell over 8% following China’s announcement of domestic immersion deep ultraviolet (DUV) lithography systems. The breakthrough, reported by Shanghai Aishengna on July 27, 2026, marks the first viable alternative to ASML’s long-held monopoly, sparking a broader sector decline.
AMD’s fundamentals remain robust, with first-quarter earnings per share at $1.37, surpassing the $1.29 estimate, and revenue reaching $10.25 billion against a $9.89 billion forecast. Data-center revenue surged 57% year-over-year to $5.8 billion, underscoring strong demand for its AI accelerators.
The sell-off reflects market concerns over long-term competition rather than near-term performance. AMD’s MI300 series relies on TSMC’s extreme ultraviolet (EUV) lithography, distinct from China’s DUV technology, but investors priced in broader sector risks.