Kioxia stock: Why Japan’s memory giant is sliding despite record demand
Kioxia’s stock price has plunged since reaching a record high in late June, falling from ¥112,750 to ¥63,100 today. The shares have dropped to their lowest level since May 29, mirroring the broader selloff across memory-chip stocks while significantly underperforming the Nikkei 225 Index.
Kioxia stock drops despite the memory boom
Top memory stocks have plunged in the past few weeks despite the ongoing boom in the memory industry, with companies like Samsung and Micron publishing strong financial results.
Micron, the third-biggest player in the High-Bandwidth Memory (HBM) industry, said that its revenue jumped by 300% in Q3, with the management predicting that its fourth-quarter revenue will cross the $50 billion milestone.
Samsung also published strong results, with its revenue and earnings soaring substantially. Its management insisted that the boom had more room to run.
Memory prices have continued rising, with the top companies operating at full capacity. As a result, these numbers mean that Kioxia’s business is also booming, with demand from hyperscalers and other large clients rising. Some of its top clients are companies like Apple, Microsoft, and Dell.
The most recent numbers showed that Kioxia’s business has continued growing. Its revenue jumped by 188% in its fourth quarter jumped by 188% YoY and by 84.5% from the previous quarter. Its ¥1 trillion ($6.8 billion) revenue was much higher than its guidance of between ¥845 billion and ¥935 billion.
The same trend happened in its profitability, with the operating profit rising by 1,499% YoY to ¥599 billion. Its net income jumped by 2,990% to ¥409 billion, and this trend will likely continue as demand and memory prices jump.
Analysts predict that its growth will continue this year. The average estimate is that its annual revenue will jump to ¥9.64 trillion, up by 9,584% YoY. It is expected to soar by 28% in the next financial year to ¥12.4 trillion.
Concerns about memory prices
Despite this growth, Kioxia’s stock has plunged by over 40% from its all-time high. This retreat has coincided with that of other memory names. SK Hynix stock has dropped by 38%, while Samsung has fallen by 30%. In the US, Micron stock has dropped from $1,246 to $904, while Sandisk has fallen from $2,343 to $1,615.
One reason for this is that investors are booking profits after these stocks soared by triple digits from January. In a recent statement, Morgan Stanley’s Mike Wilson warned that investors would rotate from memory and semiconductor companies to hyperscalers.
It is common for top performers in the stock market to retreat. A good example of this is Palantir stock,which has retreated this year. It was one of the best gainers last year, with its valuation nearing $500 billion.
Another reason is the fear that memory prices will eventually peak and start falling. It may happen this year, in 2027, or later. If this happens, stocks that thrived during the climb will likely retreat.
Kioxia share price technical analysis
The daily chart shows that the Kioxia share price has slumped from a high of ¥112,350 in June to the current ¥62,650. It has dropped below the 50-day Exponential Moving Average (EMA).
The stock has slumped below the 38.2% Fibonacci Retracement level and the Strong pivot reverse point of the Murrey Math Lines tool. Therefore, the stock will likely remain under pressure in the near term, potentially moving to the ¥57,150. In the future, however, the stock will likely bounce back as investors buy the dip.
