The factors behind SUMCO's stagnant share price include deteriorating market conditions, sluggish demand for small-diameter wafers and the impact of the dividend cut. The plan to end production at the Miyazaki Plant is attracting attention as a focus for improving earnings going forward.
SUMCO manufactures and sells silicon wafers for semiconductors, but deteriorating market conditions and sluggish demand are continuing to weigh on its share price, according to analysis. In particular, the prolonged slump in the small-diameter wafer market and intensifying competition are adversely affecting profitability.
In its consolidated results for the fiscal year ending December 2025, revenue was ¥409.6 billion and operating profit was approximately ¥1.3 billion, representing a significant decline in earnings. Against this backdrop, the company is expected to cut its dividend for the third consecutive fiscal year, adding to the deterioration in investor sentiment.
The company plans to end small-diameter wafer production at the Miyazaki Plant at the end of 2026, changing the plant's focus to the production of single-crystal ingots, the material used to make wafers. This is expected to advance the restructuring of its production system and improve earnings.
While SUMCO's strengths include its focus as a wafer specialist and its high global market share, the rise of Chinese manufacturers is intensifying the competitive environment. Going forward, the focus will be on strengthening its supply system for advanced products and its price competitiveness.
The future direction of the share price is expected to depend on progress in improving profitability, as demand recovery in the consumer, industrial and automotive sectors remains delayed even as growing AI-related demand lifts the market overall.