Japanese flash memory maker’s profits surge on AI frenzy

{"text":[[{"start":7.8,"text":"Flash storage producer Kioxia’s profits more than quadrupled on “intensifying” interest from the generative AI industry, highlighting the huge windfall from the memory supply crunch."}],[{"start":20.2,"text":"The Japanese group, formerly part of Toshiba, said on Friday that net profit in the fourth quarter surged fourfold to ¥409bn ($2.6bn) in the three months to March compared with the previous quarter. The result was a 30-fold increase from the ¥13bn in the first three months of last year."}],[{"start":42.55,"text":"The rush for memory devices to power AI models has sent Kioxia’s shares up 20-fold, making it worth ¥24.3tn and the best-performing stock on the MSCI World index last year."}],[{"start":57.25,"text":"Those shares will become easier to access for US investors seeking to bet on the memory market craze as the Tokyo-based company announced plans on Friday to list American depositary shares."}],[{"start":69.15,"text":"The strong fourth quarter powered Kioxia to exceed its financial guidance for the full year as annual profits doubled to a record ¥559bn."}],[{"start":78.45,"text":"The huge earnings from the AI frenzy are set to keep growing. Kioxia said revenue would jump by another 75 per cent quarter on quarter in the three months to June, leading net profit to double to ¥870bn."}],[{"start":92.4,"text":"“We are riding the large wave of AI demand,” said chief executive Hiroo Oota. “As AI becomes a pillar of society, the strength of the flash memory market is expected to continue.”"}],[{"start":105.45,"text":"Kioxia was formerly Toshiba Memory before an accounting scandal led the crown jewel of the Japanese conglomerate to be sold to a consortium of private equity groups led by Bain Capital for $18bn."}],[{"start":118.95,"text":"Since listing in late 2024, Kioxia shares traded largely flat before embarking on a blistering rally in the second half of last year that made it one of the most successful deals for Bain in Japan."}],[{"start":null,"text":"

"}],[{"start":131.05,"text":"The era of AI inference has transformed the fortunes of Kioxia, as large language models draw on data stored on Nand flash memory to provide answers to user queries. "}],[{"start":142.4,"text":"Before that, the industry had been suffering from a downturn after the pullback in consumer electronics demand following the pandemic."}],[{"start":150.35,"text":"Nand flash memory is vital for slower, longer-term data that is retained even when power is turned off, as opposed to DRam memory that is needed for active tasks. Rivals such as Samsung, SK Hynix and Micron produce both types of memory, but Kioxia is a specialist in Nand."}],[{"start":169.45,"text":"Its competitors have been more focused on investing in high-bandwidth memory, an ultrafast type of DRam, which has contributed to under-investment in Nand memory."}],[{"start":179.04999999999998,"text":"Nand has emerged as a critical technology for AI models, which need to use data that was previously rarely accessed but can be obtained relatively quickly from the server."}],[{"start":189.7,"text":"Investors are trying to decipher whether the memory market is going through another boom and bust cycle or whether AI will create lasting tightness."}],[{"start":198,"text":"Kioxia has predicted that the Nand market would record growth in the high teens this year and demand for Nand would outstrip supply in 2027."}],[{"start":215.45000000000002,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1778890714_2361.mp3"}