Can DRAM- and Logic-led rapid expansion offset the decline in NAND?

Revenue for the first quarter of the fiscal year ending March 2027 was ¥75.4 billion, up 45.6% year on year, while operating profit was ¥15.9 billion, up 63.9%. The main driver of revenue growth was investment in high-performance devices used in servers for generative AI. By application, DRAM-related sales rose 158% year on year and Logic/Foundry-related sales rose 82%. NAND-related sales, however, fell 34%, indicating that the semiconductor investment recovery is not broad-based.

First-quarter revenue comprised ¥58.4 billion from equipment and ¥17.0 billion from services. On a simple calculation, equipment accounted for approximately 77.5% and services for approximately 22.5%. By revenue driver, equipment sales to customers worldwide increased by ¥21.1 billion year on year and service revenue increased by ¥5.1 billion, while equipment sales to Chinese domestic customers declined by ¥2.6 billion. Accordingly, the first-half results should assess not only year-on-year revenue growth, but also whether DRAM and Logic growth was driven by higher equipment volumes and accompanied by continued growth in service revenue.

The company's 2026 market outlook assumes that the overall semiconductor manufacturing equipment market will grow by at least 25% versus 2025, with growth of approximately 25% for NAND, approximately 40% for DRAM, and approximately 20% for Logic/Foundry and other applications. First-quarter results by application showed strong DRAM and Logic performance but weakness in NAND relative to these assumptions. If this pattern continues through the first half, it would support the likelihood of achieving the full-year revenue target of ¥340.0 billion. However, if NAND weakness persists, its impact on the product mix and gross margin will become an issue.

The company reports a single segment, the semiconductor manufacturing equipment business, and does not disclose profit or gross margin by DRAM, Logic, or NAND. Therefore, at the next results announcement, it will be important to see whether the company provides additional disclosure on sales by application, year-on-year growth, the equipment-service mix, orders and shipments by application, and the proportion of high-value-added products. Consolidated profit for the single segment alone does not allow direct verification of how much DRAM and Logic strength contributed to margin improvement.