Core Viewpoint - ASML, a leading global lithography machine manufacturer, experienced a significant stock price drop of 10%, resulting in a market value loss of $34 billion, raising concerns about the semiconductor industry's stability [1][3]. Financial Performance - In Q2, ASML reported sales of €7.7 billion with a gross margin of 53.7% and an order intake of €5.54 billion, reflecting a 41% quarter-over-quarter increase [3]. - Despite strong financial metrics, the CEO expressed uncertainty about achieving growth in 2026, which shocked the market [3]. Market Dynamics - The semiconductor industry is facing heightened uncertainty due to geopolitical tensions, including a potential 30% tariff on EU imports to the U.S., which could significantly impact ASML's profit margins [3]. - ASML's orders from China, its largest market, have plummeted from 49% to 27%, indicating a substantial loss in revenue potential [3]. Technological Aspects - ASML's high numerical aperture EUV lithography machines, capable of producing 8nm chips, are costly at $400 million each, requiring extensive installation efforts [3][4]. - While demand from AI clients, particularly from companies like NVIDIA, remains strong, economic slowdowns may lead to delayed purchases from other customers [4]. Investment Signals - The semiconductor industry's technological barriers remain significant, making ASML a valuable long-term investment despite short-term volatility [4]. - Geopolitical risks, such as tariffs, are critical factors for investors to consider [4]. - Domestic competitors in China, like Northern Huachuang, are gaining market share, indicating a shift in the equipment supply landscape [4]. Strategic Recommendations - Investors holding semiconductor funds are advised to consider gradual accumulation rather than panic selling, especially in AI chip and advanced process companies [4]. - Caution is advised for those focused solely on ASML due to potential tariff and geopolitical risks [4]. - Monitoring domestic equipment leaders may reveal new investment opportunities [4].

Core Viewpoint - The article discusses the insights of H.-S. Philip Wong, TSMC's Chief Scientist, on the future of semiconductor technology and the challenges posed by U.S. policies towards China’s semiconductor industry [1][2]. Group 1: Background of H.-S. Philip Wong - H.-S. Philip Wong was born in Hong Kong and earned his Ph.D. in Electrical Engineering from Lehigh University after graduating from the University of Hong Kong [2]. - Before joining Stanford University, he led advanced semiconductor research at IBM and is known for creating the world's first carbon nanotube computer in 2013 [2]. Group 2: TSMC's Research and Development Strategy - Wong emphasized the importance of having a forward-looking research team that can identify valuable technologies, even if they are not developed in-house [3]. - He formed a small team with members from universities, other companies, and TSMC, focusing on close interaction with the external research community [3]. Group 3: Challenges in Semiconductor Manufacturing - Wong pointed out that the importance of lithography technology is decreasing, suggesting that future advancements may not rely heavily on extreme resolution [4]. - He noted that the manufacturing process has become overly time-consuming, with the entire process taking up to seven months, and emphasized the need to reduce cycle times [5]. Group 4: U.S. Policies and China's Semiconductor Industry - Wong expressed skepticism about the long-term effectiveness of U.S. strategies to contain China's semiconductor industry, suggesting that these policies may inadvertently create a market for domestic Chinese equipment manufacturers [6][7]. - He observed that while the quality of Chinese research papers has improved significantly in the past 5 to 10 years, Chinese universities still struggle to establish new research directions [7].