SUMCO (3436) 2Q FY2026 results: Inquiries strong, but cautious on capacity expansion investment

Research evidence excerpt

J P M O R G A N

Asia Pacific Equity Research

07 August 2026

SUMCO (3436)

2Q FY2026 results: Inquiries strong, but cautious on

capacity expansion investment

Neutral: SUMCO announced 2Q (April–June) FY2026 results after the August 6

close, followed by an investor briefing. During the Q&A, SUMCO signaled that

it intended to honor prices on long-term contracts still underway, and our

impression is that it will take time to realize the price hikes expected by the stock

market. In contrast, while silicon wafer demand and requests for higher volumes

are increasing, management expressed caution about the next round of capacity

expansion, focusing rather on upgrading existing products, so we see few concerns

about a breakdown in the supply/demand balance.

Earnings trends: The 2Q operating loss of ¥1.1 billion was ¥700 million

smaller than the Bloomberg consensus estimate and ¥400 million smaller than

our forecast. Operating profit improved by ¥4.1 billion QoQ, with positives

from the weaker yen (+¥1.6 billion) and higher sales volume (+¥6 billion)

outweighing the negative impact of higher costs (–¥600 million) and increased

depreciation (–¥2.9 billion). Average monthly 300mm wafer shipments

reached over 8 million units, a record high. Management guides for 3Q

operating profit to break even. It expects a ¥1.1 billion QoQ improvement,

guiding that it will cover the negative impact of higher electricity charges, labor

costs and maintenance expenses (–¥3.9 billion) and of increased depreciation

(–¥2.1 billion) through production and sales volume variance (+¥7.1 billion).

On sales and production, the boost to profits from production growth

associated with stockpiling ahead of scheduled maintenance at main plants in

4Q is significant.

Capex and pricing policy: At the briefing, there were many questions about

long-term contract prices and spot prices, as well as the company’s pricing

strategy in the context of its next round of capex. SUMCO’s policy is to focus

on investing in greater precision at existing facilities, and it does not intend to

resume new plant construction at Yoshinogari. Regarding stricter committed

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