Fitch: Kioxia is well positioned to withstand volatility in the memory chip industry

Golden Ten Data reported on May 25 that Fitch Ratings stated in a report that Kioxia appears to be better positioned to withstand the inherent volatility of the NAND flash memory market, while maintaining financial flexibility and continuing investments in technology and capacity. Fitch noted that the Japanese chip manufacturer's balance sheet has been strengthened, mainly due to improved profitability, enhanced cash generation, lower financing costs after debt refinancing, and ongoing deleveraging efforts. Fitch also highlighted the strong demand for enterprise-level SSDs driven by artificial intelligence (AI); as demand for data centers continues to expand, the share of such products in the company's sales revenue is expected to keep rising. However, Fitch stated that given Kioxia's profitability is highly sensitive to changes in NAND flash memory pricing and supply-demand dynamics, subsequent rating actions will depend on whether there are signs that cyclical volatility in the memory chip market is easing. Fitch has upgraded Kioxia's Issuer Default Rating (IDR) from "BB+" to "BBB-", with a stable outlook.