Kioxia and Advantest, two Japanese AI semiconductor firms, are seeing strong earnings growth. Kioxia's operating profit rose 92.7% to 870.4 billion yen.
Advantest expects record profit this year.
Their stock prices remain volatile.
What happened
Kioxia Holdings reported operating profit of 870.4 billion yen for the previous fiscal year, up 92.7% year-over-year, driven by AI data center SSD demand and higher NAND prices. Advantest expects record profit this fiscal year, helped by its 60% global share in SoC and memory testers.
Why it matters
Both companies are central to the AI semiconductor supply chain. Despite volatile stock prices—Kioxia's shares surged about 10-fold early in the year before halving—analysts cited in the article see sustained earnings growth due to expanding AI data center investment and increasing chip complexity.
What to watch
Advantest's performance may exceed expectations if the yen stays weak; its assumed exchange rate is 150 yen per dollar. Kioxia's next fiscal year is also projected to maintain high growth, according to market commentator Tomoya Okamura.
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The two companies illustrate how AI demand is reshaping Japan's semiconductor sector. Kioxia, a NAND flash memory specialist, benefits from AI data centers' appetite for high-capacity SSDs and rising NAND prices, while Advantest leverages the growing complexity of AI chips and HBM memory to see increased demand for its testers. The article notes that AI data center investment is broadening from GPUs to memory, testing and manufacturing equipment, electronic materials, optical communications, and power/cooling systems—suggesting a long-term structural tailwind.
Amid the stock price swings—Kioxia's shares surged about tenfold early in the year before halving—the market commentators quoted in the piece remain optimistic about earnings growth. Okamura highlights continued strong demand and high NAND prices, while Murakami points to potential upside from a weaker yen for Advantest. The consensus among market participants cited is that despite the current correction, earnings growth for these related companies is likely to persist, supporting a medium- to long-term investment view focused on fundamentals rather than short-term price volatility.
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