Kioxia (285A) Q2 2026 earnings summary

Executive summary

• Robust NAND demand, especially from AI applications, drove improved profitability in Q2 FY2025, with both operating profit and net income exceeding guidance upper limits.

• Q2 results reflected a market recovery, with net income more than doubling quarter-over-quarter and sales prices improving across all applications.

• Revenue for the six months ended September 30, 2025, was ¥791.1 billion, down 13% year-over-year due to lower ASPs and negative FX impact, despite higher bit shipments.

• Operating profit for the six months fell to ¥130.8 billion, a 55.2% decrease year-over-year, mainly from reduced revenue.

• Non-GAAP measures, excluding PPA and stock-based compensation, also showed significant declines.

Financial highlights

• Q2 FY2025 revenue was ¥448.3 billion, up 30.8% sequentially; adjusted non-GAAP gross profit was ¥145.6 billion (32% margin).

• Non-GAAP operating profit reached ¥87.2 billion (19% margin), and non-GAAP net income was ¥41.7 billion (9.3% margin).

• Non-GAAP EBITDA was ¥165.8 billion (37% margin); free cash flow was positive at ¥41.3 billion for the seventh consecutive quarter.

• Six-month revenue: ¥791.1B (down ¥118.3B YoY); SSD & Storage: ¥462.0B, Smart Devices: ¥236.3B, Other: ¥92.8B.

• Q2 (Jul–Sep 2025) revenue: ¥448.3B, up ¥105.5B sequentially; operating profit: ¥85.9B, up ¥41.0B sequentially.

Outlook and guidance

• Q3 FY2025 revenue guidance is ¥500–550 billion, with non-GAAP operating profit expected at ¥100–140 billion and net income at ¥61–89 billion.

• Record revenue and increased profit are anticipated, driven by higher ASPs and continued AI-related NAND demand.

• Nine-month FY2026 revenue guidance: ¥1,291.1–¥1,341.1B (down 5.0–1.3% YoY).

• The NAND market is projected to see mid-teens bit growth in CY2025 and high-teens in CY2026 due to supply constraints.

• Non-GAAP profit attributable to owners projected at ¥61.0–¥89.0B for Q3, up 46.4–113.6% sequentially.