By Jason Chau
Shares of Disco Corp. surged after the Japanese chip-making tool supplier reported strong earnings for its fiscal third quarter.
The Tokyo-listed stock jumped over 17% on Thursday morning, on track for its largest single day gain in over 30 years. Shares also hit their highest intraday level since July 2024 and the second-highest level since their debut in 1989.
The rally came after Disco on Wednesday reported operating profit of 47.3 billion yen, equivalent to $299 million, for the three months ended December, beating market expectations. For the nine-month period ended Dec. 31, 2025, net sales grew 11.5% while net income rose 8.7%.
The company also guided for growth across net sales, net income and shipments for the fiscal year ending March.
Disco, which makes grinders and dicers used to cut silicon wafers into semiconductors, has become a key player in the global artificial-intelligence chip supply chain. Demand for its precision tools is strong amid a surge in capital spending by major chip makers, including Taiwan's TSMC and South Korea's SK Hynix and Samsung.
Chip-related demand is expected to rise due to surging demand for memory and storage chips and AI-related applications, which is what the market has been waiting for, said Andrew Jackson, head of Japan equity strategy at Ortus Advisors.
Disco's management said the company is operating near full production capacity and demand for its tools will only continue to grow from here, Jackson added.
The benchmark Nikkei Stock Average was last up 2.1%.
Write to Jason Chau at jason.chau@wsj.com
(END) Dow Jones Newswires
01-22-26 0116ET
