Home Japanese chip gear-maker Kokusai targets Chinese growth

Japanese chip gear-maker Kokusai targets Chinese growth

Kokusai Electric Corp, a Japanese chip machinery maker, is hiring in China in a move to extend the 66% rally in stock prices it saw after its IPO in October, reports Bloomberg.

The anticipated growth in China comes down, in part, to the USA enforcing tighter export regulations on domestic chip manufacturers exporting to China. Kokusai Electric Corporation manufactures and distributes semiconductor manufacturing systems.

“Countless small-scale fabrication plants are springing up like mushrooms in China,” said Kokusai’s CEO Fumiyuki Kanai, in an interview with Bloomberg. “The Chinese government is providing aggressive support to the industry for activities including the internet-of-things, smartphones, and personal computers, ” he continued.

Kanai, who handled the Tokyo-based company’s IPO, believes that China holds continued value for Kokusai and that increasing the company’s support staff there will better serve clients. He also said that after investments for production and next-generation tool development, he will focus on shareholder returns, and will actively consider stock buybacks.

The Chinese chip market

“We have locations in China only to provide after-sale services and have no plans to do production or research there,” Kanai said. “We will increase personnel to cover the local demand.”

The Chinese market accounts for 40% of the chip gear maker’s revenue, with the expectation that this will rise to 50% in the near future.

As a result of strict export regulations from the USA, Chinese chip equipment producers were witnessing a surge in sales. However, more recent news suggests that the market may not be as stable as it appeared, with over 22,000 chip-related firms shutting their doors in 2023. This is in part due to a decline in demand caused by market changes due to Covid.

The most at-risk companies are the smallest ones which struggle to secure investments, and with their established position in the market, Kokusai is likely hoping to absorb some of the demand released by closing competitors. Kanai also stated that the company is looking to diversify into areas that complement its current range.

Featured image: RF._.studio/Pexels

About ReadWrite’s Editorial Process

The ReadWrite Editorial policy involves closely monitoring the tech industry for major developments, new product launches, AI breakthroughs, video game releases and other newsworthy events. Editors assign relevant stories to staff writers or freelance contributors with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

Ali Rees
Tech journalist

Ali Rees is a freelance writer based in the UK. They have worked as a data and analytics consultant, a software tester, and a digital marketing and SEO specialist. They have been a keen gamer and tech enthusiast since their childhood in are currently the Gaming and Tech editor at Brig Newspaper. They also have a Substack where they review short video games. During the pandemic, Ali turned their hand to live streaming and is a fan of Twitch. When not writing, Ali enjoys playing video and board games, live music, and reading. They have two cats and both of…

Get the biggest tech headlines of the day delivered to your inbox

    By signing up, you agree to our Terms and Privacy Policy. Unsubscribe anytime.

    Tech News

    Explore the latest in tech with our Tech News. We cut through the noise for concise, relevant updates, keeping you informed about the rapidly evolving tech landscape with curated content that separates signal from noise.

    In-Depth Tech Stories

    Explore tech impact in In-Depth Stories. Narrative data journalism offers comprehensive analyses, revealing stories behind data. Understand industry trends for a deeper perspective on tech's intricate relationships with society.

    Expert Reviews

    Empower decisions with Expert Reviews, merging industry expertise and insightful analysis. Delve into tech intricacies, get the best deals, and stay ahead with our trustworthy guide to navigating the ever-changing tech market.