Shin-Etsu Chemical, one of the world's largest suppliers of silicon wafers and photoresists, posted sales of ¥662.4bn and operating profit of ¥173.8bn for the quarter through June, up 5.4% and 4.2% from a year earlier. Net profit attributable to shareholders rose 3.5% to ¥130.8bn, with earnings per share of ¥70.39.
The growth came almost entirely from chips. The electronic materials segment, which makes silicon wafers, photoresists and mask blanks, reported sales up 16% to ¥279.2bn and operating profit up 23% to ¥101.9bn. Management attributed the gain to continued strength in AI-related semiconductor demand alongside a pickup in other end markets, plus price increases on higher volumes.
The company's chemicals business told a different story. The living-environment and infrastructure materials segment, which covers PVC and caustic soda, saw sales fall 7% to ¥227.7bn and operating profit drop 34% to ¥34.8bn. Shin-Etsu had pushed through price increases across all PVC markets earlier in the year after Iran-Middle East tensions drove up feedstock and energy costs, but from late May, oversupply and softening demand in Asia pushed prices down again. Caustic soda held up better, staying broadly firm through the quarter.
| Segment | Q1 sales | Change YoY | Q1 operating profit | Change YoY |
|---|---|---|---|---|
| Electronic materials (semiconductors) | ¥279.2bn | +16% | ¥101.9bn | +23% |
| Living-environment & infrastructure materials (PVC, caustic soda) | ¥227.7bn | -7% | ¥34.8bn | -34% |
| Functional materials | ¥118.2bn | +7% | ¥28.8bn | +20% |
| Processing, trading & technical services | ¥37.1bn | +10% | ¥7.6bn | +8% |
For the year to March 2027, Shin-Etsu is guiding to sales of ¥2.7tn, operating profit of ¥700bn, ordinary profit of ¥770bn and net profit of ¥525bn. Each figure would mark an increase over the year just ended, when the company booked sales of ¥2.57tn, operating profit of ¥635.2bn and net profit of ¥474.5bn. The forecast notice does not list a previously announced full-year guidance figure for comparison, so it is not possible to say from the filing how much this outlook has moved since an earlier company estimate. The company also projects an annual dividend of ¥116 a share, split evenly between interim and year-end payments, above the ¥106 actually paid for the year just ended; again, no prior dividend forecast is shown in the notice to measure the size of any change.
Separately, Shin-Etsu set the mechanics for completing the remaining ¥197.3bn of its ¥250bn share buyback authorization, which runs through April 27, 2027. The company will buy shares off-floor on the Tokyo Stock Exchange's ToSTNeT-3 system on a trading day between July 29 and August 4, using a "fully committed share repurchase" structure. Nomura Securities will place the sell orders using borrowed shares, while Nomura Capital Investment will receive two stock acquisition rights on August 10 that let Shin-Etsu true up its effective purchase price to the stock's volume-weighted average price over two follow-on periods, at adjustment ratios of 98.493% and 97.984%. Shin-Etsu had already completed roughly ¥52.7bn of the ¥250bn program through a tender offer that closed in June.