Tokyo Electron (8035): Raising earnings estimates: We expect sharp profit growth on price increases, market growth

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Tokyo Electron (8035): Raising earnings estimates: We expect sharp profit growth on price increases, market growth

J P M O R G A N Asia Pacific Equity Research

17 June 2026

Tokyo Electron (8035) Overweight

8035.T, 8035 JP

Raising earnings estimates: We expect sharp profit Price (17 Jun 26):¥72,640

growth on price increases, market growth ▲Price Target (Dec-26):¥85,000 Prior (Dec-26):¥51,000

We revise our earnings estimates to reflect recent developments. We maintain our

Overweight rating and significantly raise our end-December 2026 price target Japan Equity Research

from ¥51,000 to ¥85,000. Our global team has raised their WFE market growth Technology - Semiconductor/

outlook, and we also assume a market share recovery for Tokyo Electron centered Technical Materials

on dry etchers (its share fell 4ppts YoY in CY2025). We expect faster growth for AC Mio Shikanai

the company than for the overall market as its business mix by application and (81-3) 6736 1313

equipment type gives it a relative advantage in the WFE market excluding China. mio.shikanai@jpmorgan.com

Furthermore, while yen-denominated sales were an earnings headwind in a weak- Junya Ayada

yen environment, we expect strong FY2025–28 operating profit CAGR of 36%, (81-3) 6736 8631

driven by progress on pricing measures, including a strengthening of the surcharge junya.ayada@jpmorgan.com

system and price increases aimed at improving margins. JPMorgan Securities Japan Co., Ltd.

• Earnings estimates: We revise our operating profit estimates from ¥796 Key Changes (FYE Mar)

billion to ¥975 billion (+56% YoY) for FY2026 and from ¥1,030 billion to

Prev Cur Δ

¥1,321 billion (+35% YoY) for FY2027. We introduce an FY2028 estimate of Adj. EPS - 27E (¥) 1,352.52 1,659.89 22.7%

¥1,585 billion (+20% YoY).