Kioxia Stock Falls 18% Ahead of Earnings: Can Results Halt the Sell-Off?

Key Takeaways

• Kioxia stock plunged 18.33% to ¥44,550 on July 28 and has now fallen more than 60% from its 52-week high.
• Kioxia will publish its first-quarter FY2026 results on July 31 at 15:30 JST, not July 30 as some reports indicated.
• The company has already issued exceptionally strong quarterly guidance, meaning investors may focus more on NAND prices, future demand and management’s outlook than the headline results.

Kioxia Stock Plunges as the Chip Sell-Off Deepens

Kioxia stock dropped ¥10,000, or 18.33%, on July 28. The shares opened at ¥44,650, briefly reached ¥47,720 and finished at the session low of ¥44,550.

The closing price was 60.5% below the stock’s 52-week high of ¥112,700. The company’s market capitalisation also declined to approximately ¥24.41 trillion after previously rising above several of Japan’s largest listed companies during the AI-driven semiconductor rally.

The decline was not limited to Kioxia. Semiconductor and technology stocks fell across Asia as investors reduced exposure to companies that had benefited from enthusiasm surrounding artificial intelligence. The Nikkei 225 dropped about 4.4%, while South Korea’s Kospi fell more than 10% at one point, triggering a temporary trading halt.

SK Hynix shares declined by as much as 10%, Samsung Electronics lost more than 12%, and Japanese chip-equipment companies including Tokyo Electron and Advantest also recorded heavy losses. The broad nature of the decline suggests that Kioxia’s fall reflects a sector-wide reassessment rather than a single company-specific development.

Memory stocks had previously experienced exceptional gains as investors priced in rising demand from AI data centres, stronger memory prices and limited production capacity. When expectations become this elevated, even a small change in the market outlook can lead to aggressive profit-taking.

Why Investors Are Rethinking the NAND Memory Boom

Kioxia is one of the world’s largest producers of NAND flash memory, which is used in smartphones, computers, enterprise storage systems and data centres. It also produces solid-state drives and embedded storage products such as UFS and eMMC devices.

The company’s recent business performance has benefited from a sharp rise in NAND prices and growing demand for enterprise SSDs. These drives are increasingly important to AI infrastructure because data centres require large amounts of high-speed storage for datasets, model outputs and inference workloads.

Industry data still indicates that current NAND market conditions are strong. TrendForce estimated that the combined revenue of the five largest NAND suppliers increased 83.7% quarter on quarter during the first calendar quarter of 2026. Kioxia’s NAND revenue increased 80% to $5.96 billion, giving it a 13.9% market share and third place in the global supplier rankings.

The research group also expects the NAND market to record a supply deficit of approximately 4% to 5% in 2026. Limited capacity additions and continued demand from AI servers could therefore support elevated selling prices in the near term.

However, equity markets generally focus on future conditions rather than current earnings. A more recent TrendForce NAND market forecast indicated that supply growth could begin to exceed demand during the second half of 2027 as manufacturers improve production efficiency and Chinese suppliers introduce additional capacity.

Chinese producers could account for nearly 19% of global NAND bit output as new manufacturing equipment becomes operational. At the same time, weak consumer electronics demand remains a potential risk. TrendForce expects global smartphone production to decline by 15% to 20% in 2026, while notebook shipments could fall by around 10%.

Servers now represent more than 40% of total NAND bit demand, but smartphones and notebooks still account for nearly another 40%. Weakness in these consumer markets could eventually offset some of the growth generated by AI data centres.

The recent sell-off therefore does not necessarily mean that NAND demand has already collapsed. It indicates that investors are questioning how long the current shortage, pricing strength and unusually high profit margins can continue.

What to Expect From Kioxia’s July 31 Earnings

Kioxia will publish its first-quarter FY2026 results on July 31 at 15:30 JST, according to the company’s official investor relations calendar. The reporting period covers the three months ended June 30, 2026.

The company entered the quarter with substantial momentum. Revenue for the three months ended March 31 reached ¥1.003 trillion, up from ¥543.6 billion in the previous quarter. Operating profit increased from ¥142.8 billion to ¥596.8 billion, while profit attributable to shareholders climbed to ¥407.7 billion.

For the full financial year ended March 31, Kioxia reported revenue of ¥2.338 trillion, an increase of 37% from the previous year. Operating profit rose 92.7% to ¥870.4 billion, while attributable profit more than doubled to ¥554.5 billion.

Kioxia’s official business outlook set an exceptionally high target for the April-to-June quarter. The company forecast revenue of ¥1.75 trillion, representing 74.5% sequential growth. Operating profit was projected to reach ¥1.298 trillion, while attributable profit was forecast at ¥869 billion.

These figures are company guidance rather than analyst estimates. They have already established a high benchmark for the coming report.

Even if Kioxia meets these targets, the market reaction may depend more heavily on management’s comments about the next quarter. Investors will want to know whether NAND average selling prices are continuing to rise, whether shipment volumes are improving and whether enterprise SSD demand can compensate for weaker smartphone and computer sales.

Margins will be another important area. Kioxia previously projected an operating margin of approximately 74% for the quarter, an unusually high level for the cyclical memory industry. Any indication that pricing or margins have peaked could reinforce concerns that current earnings are difficult to sustain.

Investors may also seek an update on a US patent case involving Kioxia subsidiaries. A jury awarded Viasat approximately $229 million, or ¥37.1 billion, in damages in July. Kioxia said it disagreed with the verdict and intended to pursue available legal options, while the potential effect on its financial outlook remained under investigation.

Kioxia Stock Technical Analysis

source:tradingview

Kioxia stock’s daily price structure remains bearish following the latest decline. The shares have fallen below their 50-day and 100-day exponential moving averages, while the sequence of lower highs and lower lows indicates that sellers remain in control.

The ¥44,550 closing price is close to the 61.8% Fibonacci retracement of the wider advance between the 52-week low of ¥2,270 and the high of ¥112,700. That makes the ¥44,000–¥45,000 area an important short-term technical zone.

Holding above this region could allow the shares to consolidate before the earnings announcement. The previous closing price of ¥54,550 would then become the first significant resistance level. A recovery above approximately ¥55,000–¥56,000 would be needed to suggest that immediate selling pressure is beginning to ease.

A decisive break below ¥44,000 would weaken the technical picture further. The next long-range Fibonacci reference is near ¥26,000, although intermediate support could emerge before that level. Fibonacci levels are reference areas rather than price forecasts, particularly when an earnings announcement can produce substantial price gaps.

What Comes Next for Kioxia Stock?

Kioxia’s earnings create two contrasting scenarios. Stronger-than-guided results, continued NAND price increases and an optimistic demand outlook could reassure investors that the decline has moved ahead of the company’s fundamentals. After a fall of more than 60%, that combination could help the shares stabilise or produce a short-term rebound.

The more challenging scenario would be strong historical results accompanied by cautious forward guidance. If management signals that NAND prices are approaching a peak, margins are likely to normalise or supply will grow more quickly, investors may continue reducing their exposure despite record quarterly profits.

The central question is therefore no longer whether Kioxia had a strong April-to-June quarter. Its previous guidance already points to extraordinary growth. The more important issue is whether that performance represents the beginning of a durable AI storage cycle or the peak of an unusually profitable period for NAND manufacturers.

Until management provides greater clarity on July 31, Kioxia stock is likely to remain sensitive to changes in semiconductor sentiment, AI spending expectations and the wider memory-market outlook.