Caution in capital expenditure: Kioxia's market cap exceeds 50 trillion yen, but its annual investment plan is down 10% from the 2023 peak

Odaily AI investor @Lupang posted on X platform, stating that Kioxia's market capitalization recently surpassed 50 trillion yen, yet its future capital expenditure remains cautious compared to the past. Kioxia plans to invest an average of 470 billion yen annually from fiscal 2026 to 2028, an increase of 66% from fiscal 2025, but approximately 10% lower than the historical high of 510.4 billion yen in fiscal 2023.

In 2022, Kioxia invested 1 trillion yen in its Yokkaichi plant, subsequently suffering five consecutive quarters of losses due to a demand decline. The company's current focus is on cash flow management surrounding its Kitakami plant. The NAND market is currently in an upcycle, with contract prices in the second quarter of 2026 rising 70% to 75% quarter-over-quarter, exacerbating supply shortages. Kioxia plans to convert 50% of its total shipments to long-term supply agreements by 2028 to secure a stable revenue base. As Kioxia restricts market supply, Samsung Electronics and SK hynix may gain opportunities, and South Korean NAND process materials, components, and equipment companies could also benefit. The consortium led by SK hynix still holds an 18% stake in Kioxia, and as Kioxia's enterprise value rises, SK hynix's potential investment returns could expand.