JPMorgan: Kioxia Records Record Profit in Q1, Announces Up to ¥800 Billion Share Buyback to Boost Stock Price Sentiment

BlockBeats News, August 3rd. JPMorgan Chase released a report stating that the Japanese storage stock Kioxia's first-quarter performance hit a record high, with sales reaching ¥1.7671 trillion, a year-on-year increase of 415% and a quarter-on-quarter increase of 76%; Non-GAAP operating profit reached ¥1.3262 trillion, a year-on-year increase of 2833% and a quarter-on-quarter increase of 121%, with an operating profit margin of 75%.

The report stated that Kioxia's first-quarter performance was mainly driven by price increases, with ASP increasing by about 70% quarter-on-quarter, and bit shipment volume growing by low single digits quarter-on-quarter. By business segment, SSD and storage business sales reached ¥1.1747 trillion, a year-on-year increase of 440% and a quarter-on-quarter increase of 96%, accounting for 66% of total revenue; of which, the data center and enterprise business accounted for over 60% of this sector's revenue.

Looking ahead to the second quarter, Kioxia guided revenue to be ¥2.39 trillion, Non-GAAP operating profit to be ¥1.9 trillion, with the operating profit margin expected to rise to 79.5%. The company expects a 35% quarter-on-quarter revenue growth in the second quarter, continuing to be driven by ASP increases, while data center and enterprise-level demand remain strong.

JPMorgan Chase believes that the enterprise SSD sales ramp-up trend of Kioxia is still a more important observation point. The company also announced a share buyback of up to ¥800 billion, which is expected to provide support for the stock price sentiment. JPMorgan Chase maintains a "Neutral" rating on Kioxia with a target price of ¥155,000.