Advancing against the tide amid the "AI slowdown" storm? Kioxia rumored to seek a U.S. listing to raise at least $10 billion.

Title context: Advancing against the tide amid the "AI slowdown" storm? Kioxia rumored to seek a U.S. listing to raise at least $10 billion. Text: Japanese memory chip maker Kioxia Holdings is considering raising at least $10 billion through an American Depositary Receipt (ADR) offering in the United States, joining a wave of AI-related companies seeking to tap the world's deepest capital pool. People familiar with the matter said Kioxia has held talks with banks including Bank of America, Goldman Sachs, and JPMorgan about a potential offering within the next year. Notably, the plan surfaced on the same day that AI slowdown fears triggered a global selloff in chip stocksNasdaq 100 futures fell 1.6% in early trading. Deal Highlights: Liquidity, Shareholder Structure, and Index Inclusion The Tokyo-based memory manufacturer, which bought back billions of dollars worth of shares in Japan, hopes to gain more dollar liquidity through a U.S. listing, said the people, who asked not to be identified because the matter is private; an ADR offering could also give Kioxia access to semiconductor-focused U.S. stock indices. Deliberations are still at an early stage, and details such as the offering size and bank lineup could change. Representatives for Kioxia, Goldman Sachs, and JPMorgan declined to comment, while Bank of America did not respond to a request for comment. Kioxia has previously said it plans to issue ADRs in the spring of 2027 but did not disclose further details; if the latest reports materialize, it would mark the first time the offering size has been specified at the $10 billion-plus level, with the timeline potentially moved up. Semiconductor companies and other AI-related businesses worldwide are seeking to capitalize on investor enthusiasm for the sectorSouth Korean memory chip maker SK Hynix raised $26.5 billion in a U.S. listing in July, setting a record for the largest IPO by a foreign company. Kioxia is a key global supplier of NAND flash memory, the storage segment benefiting most from current AI infrastructure buildout. According to industry data cited by AInvest, the NAND market faces a supply gap of about 4-5% for the full year in 2026, and TrendForce expects contract prices to rise another 70-75% quarter-over-quarter by mid-2026; enterprise SSDs accounted for 43% of NAND market revenue in the first quarter and are expected to exceed 60% by year-end, with servers now accounting for more than 40% of NAND bit demand. From Toshiba Castoff to Japan's Stock King: A 400% Rollercoaster in One Year Kioxia's predecessor was Toshiba's memory chip businessthe pioneer of NAND flash technology. The business was acquired by a Bain Capital-led consortium in 2018 and renamed Kioxia the following year, raising only 120 billion yen when it listed in Tokyo in December 2024. The AI buildout boom completely rewrote its fortunes: according to reports, Kioxia surpassed Toyota on June 12 this year to become Japan's most valuable listed company, with market capitalization briefly exceeding 44 trillion yen (about $274 billion) and year-to-date gains at one point exceeding 670%, topping the MSCI World Index performance rankings. The stock has since pulled back along with the sector. Kioxia's Tokyo-listed shares are still up nearly 400% this year, with a current market capitalization of about $180 billiondown about one-third from its June peak. In July, Kioxia issued conservative earnings guidance that the market interpreted as falling short of expectations; the company promptly announced a 1-for-3 stock split and a buyback plan of up to 800 billion yen (about $5.2 billion) to broaden its shareholder base and reduce stock price volatility. In May, S&P and Fitch simultaneously upgraded Kioxia's rating to BBB-, crossing into investment grade for the first time. Financial Strength: Single-Quarter Operating Profit Exceeds Full Previous Fiscal Year What underpins this capital move is textbook cyclical performance. According to company financials, in the latest quarter ended June, Kioxia's revenue reached 1.77 trillion yen, up 415% year-over-year, with blended average selling prices rising 70% quarter-over-quarter; non-GAAP operating profit was 1.33 trillion yen, with an operating margin of 75%single-quarter operating profit already exceeded the 870 billion yen of the entire previous fiscal year. Non-GAAP net income for the quarter was 887 billion yen, free cash flow surged 3.4x quarter-over-quarter to 827 billion yen, the company repaid all 408 billion yen of senior debt and shifted to a net cash position, with cash and equivalents reaching a record 791 billion yen. Kioxia confirmed in February this year that its entire 2026 NAND capacity has been locked up by customers, with some hyperscale cloud customers also requesting long-term supply commitments covering 2027 to 2028. Headwinds: Listing Timing Collides with AI Slowdown Storm The problem is timing. Analysts note that as Kioxia weighs this offering, the stock market is being roiled by expectations that AI development may slowafter U.S. AI giants discussed over the weekend introducing safety guardrails and impact assessments for their most advanced models, Nasdaq 100 futures fell 1.6% in early trading, and the Philadelphia Semiconductor Index ETF dropped as much as 5.7%. Asian markets have already priced this in today: Kioxia itself closed down 6.4% in Tokyo, SK Hynix fell 6.4%, Samsung Electronics dropped 4.1%, and SoftBank declined 10.7%. Capital events in the same space are also shifting: Anthropic's sprint toward an IPO at a roughly $2 trillion valuation has been clouded by the safety narrative, with market speculation that it may need to amend its S-1 filing, while OpenAI has explicitly stated it will not go public in 2026. Institutional Views Interpretations of this offering are polarized. Bulls argue that the nearly 400% year-to-date gain means Kioxia has ample "paper gains" to realize regardless of near-term sentiment, and that management's buybacks and stock split this yearwhich were already laying the groundwork for stock price stability ahead of a major capital eventwould logically extend to seeking a deeper investor pool in the U.S.; if the offering materializes, it would be one of the largest U.S. listings by a Japanese company in history and a landmark event signaling the AI capital cycle's intense concentration in the memory segment. Analysis by Lumida News points to the core issue: SK Hynix's $26.5 billion ADR offering landed at the peak of AI infrastructure enthusiasm in July, while Kioxia is considering a similar move just as that enthusiasm shows its first real crack amid the AI safety debatesubscription demand for a $10 billion-plus offering will be a real-time test of whether demand for memory chip exposure can withstand the current AI slowdown narrative. The cautious camp focuses on cycle-peak risks. Analysis by AInvest notes that the rise of Chinese manufacturers and the release of new global capacity after 2027 could cause supply to exceed demand in the medium term, at which point the current 75% operating margin would be unsustainable; more than two-thirds of Kioxia's revenue depends on data centers and enterprise SSDs, while smartphones and laptops still account for nearly 40% of NAND demand and are contracting. Gokhshtein research highlights two validating milestones: the premium or discount of the offering terms relative to the Tokyo listingwhich will reveal whether U.S. capital views the AI memory story as overheated or still undervalued; and the fiscal 2027 guidance when the ADSs are launchedwhich will answer whether this surge is merely borrowing from the future or a leading indicator of genuine earnings growth.