RORZE CORPORATION

Business Details

Develops, manufactures, and sells clean-room-compatible dust-free transfer equipment (EFEM, Wafer Sorter, N₂ Purge-Compatible Wafer Stocker, etc.), vacuum wafer transfer equipment, analysis equipment, large glass substrate transfer systems, and other products for the semiconductor and FPD industries. Major customers are Applied Materials, Inc. (sales of ¥8,130 million in 1Q FY2027 (ending February 2027), 21.9% of segment sales) and TSMC (¥6,768 million, 18.2%). This core segment accounts for approximately 99% of consolidated net sales. The Vietnamese subsidiary serves as the main plant for semiconductor-related equipment, while the Korean subsidiary handles FPD-related equipment.

Recent Overview

1Q orders received surged 190.2% year on year, and the order backlog reached a record high level

In the first quarter of FY2027 (ending February 2027) (March to May 2026), orders received in the Semiconductor & FPD Related Equipment Business expanded rapidly to ¥45,788 million (up 190.2% year on year). This was driven by semiconductor-related equipment at ¥42,030 million (up 188.4% year on year) and analysis equipment at ¥2,366 million (up 396.3% year on year). The order backlog reached ¥67,963 million (up 127.9% year on year), an increase of ¥22,627 million from the end of FY2026 (ending February 2026). Sales were ¥37,075 million (up 12.5% year on year), and segment profit was ¥10,834 million (up 23.3% year on year). Sales to the major customer Applied Materials increased substantially to ¥8,130 million (21.9% of segment sales), up from ¥5,058 million (15.3%) in the same period of the prior year. Sales to the United States also became the largest by region at ¥11,062 million, up year on year.

Key Products

Growth Drivers

• Expansion of capital investment in advanced logic and memory fields for data centers, driven by the spread of generative AI
• Rapid expansion of sales to Applied Materials (¥8,130 million in 1Q FY2027, ending February 2027, up 60.7% year on year), reflecting increased demand from the United States
• Surge in orders for analysis equipment (VPD systems, etc.) (orders of ¥2,366 million in 1Q FY2027, ending February 2027, up 396.3% year on year)
• Continued demand from Taiwanese customers (TSMC, etc.) (sales of ¥6,768 million in 1Q FY2027, ending February 2027)
• Recovery in sales of FPD-related equipment (sales of ¥2,032 million in 1Q FY2027, ending February 2027, up 202.9% year on year)
• Enhancement of production capacity through construction of a new plant at the Vietnamese subsidiary (RORZE ROBOTECH CO., LTD.), scheduled to begin operation in spring 2028
• Expansion of aftermarket revenue through increased sales of parts, repairs, and other items (¥3,913 million in 1Q FY2027, ending February 2027, up 127.9% year on year)

Risks

• U.S. patent litigation with Kawasaki Heavy Industries, Ltd. (jury verdict of provisional damages of $48 million, currently under appeal); a provision for litigation losses of ¥7,429 million has been recorded under fixed liabilities
• Risk of impact on sales to China from U.S. semiconductor export control regulations and U.S.-China trade regulations (sales to China of ¥9,234 million in 1Q FY2027, ending February 2027)
• Profit pressure from goodwill amortization burden (¥810 million in 1Q FY2027, ending February 2027)
• Uncertainty regarding medium-term sales contribution due to the low order backlog level for FPD-related equipment (¥1,037 million at the end of 1Q FY2027, ending February 2027, 37.6% of the prior-year level)
• Risk of natural disasters at the Vietnamese subsidiary (there is a history of typhoon damage) and risk of deterioration in the parts procurement environment
• Risk regarding whether production capacity can keep pace with the rapid expansion of orders received (up 190.2% year on year)

Business Details

This business, operated by Rorze Life Science Co., Ltd., develops, manufactures, and sells incubators (cell culture equipment) and software packages that automate cell culture processes manually performed by researchers engaged in drug discovery research and cell culture, including iPS cells. Although it accounts for a small proportion of consolidated group sales, at less than approximately 0.4%, the business base was expanded through the consolidation of Genostaff Co., Ltd. as a subsidiary in FY2024 (ending February 2024). Major customers are in the drug discovery industry and research institutions.

Recent Overview

Orders received surged 502.8% year on year, and the order backlog built up to ¥772 million

In the first quarter of FY2027 (ending February 2027) (March to May 2026), the Life Science Business recorded sales of ¥131 million (up 18.8% year on year), an increase, while the segment loss widened to ¥119 million (compared with a loss of ¥110 million in the same period of the prior year). Notably, order trends were strong, with orders received surging to ¥741 million (up 502.8% year on year) and the order backlog reaching ¥772 million (up 539.1% year on year). Production volume remained at a low level of ¥20 million (14.4% of the prior-year level), and attention is focused on whether the buildup in the order backlog will translate into future sales contribution.

Key Products

Growth Drivers

• Expanding demand for cell culture automation in drug discovery research and regenerative medicine fields
• Increasing activity in cell culture research, including iPS cells
• Expansion of product lineup and customer base through the consolidation of Genostaff Co., Ltd. as a subsidiary
• Orders received in 1Q FY2027 (ending February 2027) surged 502.8% year on year, and the order backlog of ¥772 million suggests sales contribution in future periods

Risks

• The segment accounts for a small proportion of consolidated group sales, at less than approximately 0.4%, limiting its contribution to earnings
• Continued segment losses (-¥119 million in 1Q FY2027, ending February 2027) make stabilizing profitability a challenge
• Goodwill amortization burden pressures profit
• The market for drug discovery and research institutions is susceptible to economic conditions and research budgets, creating risk of order volatility
• Production volume declined sharply to 14.4% of the prior-year level, making the digestion of the order backlog and production capacity response a challenge
• Need to maintain differentiation and technological advantage over competitors