Kioxia Shares Drop 40% Amid Market Volatility Despite Strong Earnings
Despite a recent 40% decline in July, Kioxia's shares have shown resilience and are up over 370% year-to-date. The Japanese semiconductor maker reported strong quarterly earnings with an operating profit of 1.27 trillion yen for the April-June period—up sharply from 44.9 billion a year earlier—and revenue rising more than fivefold to 1.77 trillion yen. The company attributed its performance to increased bit shipments, a weaker yen, and strong demand driven by AI-focused data centers. Analysts remain optimistic about Kioxia's outlook despite broader market concerns over the sustainability of AI spending and potential price competition from rivals like TSMC or SK Hynix. Recent volatility was partly due to forced selling by hedge funds in memory stocks. Kioxia’s planned share buyback of up to 800 billion yen is seen as positive, with analysts noting it will not impact future dividends. The company's strong manufacturing advantages and tight NAND supply-demand dynamics are expected to support its pricing power.
Topics: AI Demand Memory Market Semiconductors Stock Performance