TAZMO Co.,LTD.

Business Details

Develops, manufactures, sells, and maintains electronic device manufacturing process equipment and related peripherals for semiconductors, liquid crystal displays, and other applications. Composed of three divisions: Semiconductor Equipment (coating/developing, for advanced packaging), Transport Equipment (wafer transport robots), and Cleaning Equipment (single-wafer and batch type) (from Q1 FY2026 (ending December 2026), Coaters were integrated into Semiconductor Equipment). Major customers are domestic and overseas semiconductor manufacturers and research institutions. The company also has cost competitiveness leveraging its production system at its Vietnamese subsidiary.

Recent Overview

Sales declined slightly but orders received surged over fourfold year on year, led by Semiconductor Equipment

In Q1 FY2026 (ending December 2026), Process Equipment Business sales were ¥4,737 million (down 1.4% year on year), and operating profit was ¥60 million (down 92.0% year on year), a significant decline in profit. While Semiconductor Equipment saw acceptance inspections proceed as planned and achieved higher sales, Transport Equipment saw lower sales due to a shortage of projects for which sales could be recorded. On the order front, orders for Semiconductor Equipment surged to ¥11,711 million (up 897.0% year on year), and segment-wide orders received reached ¥14,641 million (up 407.6% year on year), with order backlog building up to ¥27,618 million (up 14.2% year on year), providing a favorable leading indicator for future sales recognition.

Key Products

Growth Drivers

• Increased demand for Semiconductor Equipment for advanced packaging driven by expanding capital expenditure for generative AI-related servers (Semiconductor Equipment orders received up 897.0% year on year)
• Room for future sales recognition from the buildup of order backlog to ¥27,618 million (up 14.2% year on year)
• Order conditions for Transport Equipment are on a recovery trend, with future sales growth expected
• Cost competitiveness leveraging the Vietnamese subsidiary (TAZMO VIETNAM CO., LTD.)
• Rising capital expenditure appetite among customers amid memory semiconductor supply shortages and price increases driven by AI server-related demand

Risks

• High dependence on the semiconductor industry's capital expenditure cycle (boom-bust swings directly affect results)
• Uncertainty in the timing of sales recognition for the Transport Equipment and Cleaning Equipment divisions (recovery in orders takes time to translate into sales)
• Risk of continued weakness in wafer manufacturers' capital expenditure (Cleaning Equipment order backlog down 18.4% year on year)
• Impact of structural contraction in FPD-related capital expenditure following the integration of Coaters (liquid crystal color filter manufacturing equipment) into Semiconductor Equipment
• Risk of sales concentration among specific customers (TSMC is a major customer)
• Uncertainty in the business environment due to heightened geopolitical risk and unstable exchange rates
• Risk of delays in acceptance inspection and sales recognition despite the buildup in order backlog

Business Details

Manufactures and sells precision molds for resin molding and resin molded products. Main products are Connectors for Electronic Equipment and Embossed Carrier Tape. Domestically, subsidiary Pretec Corporation handles manufacturing while Tazmo Co., Ltd. handles sales. Overseas, Shanghai Longyun Precision Machinery Co., Ltd. handles both manufacturing and sales. In Q1 FY2026 (ending December 2026), the segment fell into an operating loss due to surging raw material costs and factory relocation expenses.

Recent Overview

Surging raw material costs and factory relocation expenses pushed Q1 into an operating loss

Sales in Q1 FY2026 (ending December 2026) were ¥278 million (down 5.2% year on year), tracking roughly in line with plan, but rising raw material costs and factory relocation expenses squeezed profitability, resulting in an operating loss of ¥0 million (compared to operating profit of ¥38 million in the same period last year). Orders received were also low at ¥264 million (down 21.3% year on year), and order backlog stood at ¥156 million (down 26.5% year on year), reflecting a soft order environment at present.

Key Products

Growth Drivers

• Potential for sales expansion from a recovery in orders for Connectors for Electronic Equipment and Embossed Carrier Tape
• Improved profitability from normalization of the cost structure after completion of the factory relocation
• Improved fixed cost absorption from expanded production volume

Risks

• Risk of order fluctuation dependent on capital expenditure trends in the electronic equipment market (Q1 FY2026 orders received down 21.3% year on year)
• Risk of cost pressure from elevated raw material prices (materialized in Q1 FY2026)
• Risk of temporary cost increases such as factory relocation expenses
• Small segment scale (approximately 4.7% of group sales) leading to large swings in profitability due to fixed cost burden
• Geopolitical risk and exchange rate fluctuation risk at the overseas manufacturing base (Shanghai Longyun Precision Machinery Co., Ltd.)
• Residual risk of asset impairment, having recorded an impairment loss of ¥100 million in the previous fiscal year (FY2024, ended December 2024)

Business Details

Manufactures and sells printed circuit board manufacturing equipment (Plating Equipment and Circuit Formation Equipment). Centered on consolidated subsidiary Facility Co., Ltd., production takes place at overseas manufacturing bases in China and Vietnam (Fortrend Technology (Dongguan) Co., Ltd. and FACILITY HANOI CO., LTD.), with deliveries to China and other overseas markets via Fortrend (Hong Kong) Co., Ltd., and domestic deliveries via Facility Co., Ltd. In Q1 FY2026 (ending December 2026), a shortage of projects for which sales could be recorded resulted in a significant decline in both sales and profit.

Recent Overview

Shortage of projects for which sales could be recorded caused a significant year-on-year decline in sales and operating profit

In the Surface Treatment Equipment Business in Q1 FY2026 (ending December 2026), a shortage of projects for which sales could be recorded led to a significant decline in both sales and profit, with sales of ¥951 million (down 60.7% year on year) and operating profit of ¥14 million (down 96.3% year on year). On the other hand, orders received reached ¥1,153 million (up 229.6% year on year), significantly exceeding the same period last year and showing signs of an order recovery. Order backlog remained at a low level of ¥1,976 million (54.0% of the same period last year).

Key Products

Growth Drivers

• Orders received increased significantly to 229.6% of the same period last year, and this is expected to translate into future sales recognition
• Cost competitiveness leveraging overseas manufacturing bases in China and Vietnam
• Strengthened manufacturing and sales system through collaboration with Facility Co., Ltd. and group subsidiaries
• Ongoing capital expenditure demand in the printed circuit board market

Risks

• Order backlog is at a low level of ¥1,976 million (54.0% of the same period last year), a weak leading indicator for sales recognition
• Structural risk of large quarterly performance swings due to uneven distribution of projects for which sales can be recorded
• Structural risk of results being heavily affected by industry capital expenditure trends
• Impact on operations and profitability at the China and Vietnam bases from heightened geopolitical risk and exchange rate fluctuations
• Full-year segment sales for FY2026 (ending December 2026) are forecast at ¥4,500 million, implying a significant year-on-year decline and a premise of concentration in the second half