SCREEN Holdings, also referred to as Dainippon Screen Mfg. and listed under ticker 7735, said first-quarter sales in 2026 were slow but second-quarter sales increased, prompting an upward revision of its full-year sales forecast to JPY 743 billion. Chiho Otobe, senior executive officer and head of global communication strategy in the company's IR department, said the company made an upward revision for the entire company and that the July forecast of JPY 743 billion would be a record high if achieved. The call included questions from analysts Wei Pang Yeo of Orion Group, Erica Kim and Phil Chan.
Shares were quoted at $13,780, up 1.96%, or about $265, from the previous close of $13,515. The stock was approximately 144% above its 52-week low of $5,647.5 and roughly 30% below its 52-week high of $19,770. Market capitalization was reported at $16.8 billion, with a P/E ratio of 29.86 and return on equity of 19%.
Guidance for semiconductor production equipment, or SPE, called for second-half sales of JPY 360 billion and a second-half margin of 27.4%, while full-year SPE margin guidance remained unchanged at 25%. Post-sales revenue was guided at JPY 58.8 billion in the first half and JPY 52.5 billion in the second half. Advanced packaging sales were expected to exceed JPY 10 billion during the fiscal year.
Inventory rose to JPY 192 billion in the first quarter from JPY 158 billion in the fourth quarter. The equity ratio was 64.6%, below the company's stated comfort zone of 65% to 70%. Management explained that a delayed project worth about JPY 10 billion to JPY 20 billion moved from the first quarter to the second quarter because a customer's fab was not ready; the equipment had been shipped more than a year earlier, a 100% down payment had been received, and agreement terms were revised.
The company raised its calendar-year 2026 wafer fab equipment market growth forecast from a prior 15% to 20% range to over 20%, while saying it does not rule out 30% growth, which it also expects to be sustained into calendar year 2027. For calendar 2026, foundry and logic spending was expected to grow more than 25%, DRAM spending was expected to grow more than 25%, NAND investment was described as shifting from flat expectations to major increases, and China was expected to move from a flat or slight-increase outlook to double-digit growth of 10% or more.
Operationally, the Hikone plant in Shiga remains the main mother production base. The company's S-Cube 3 automated factory is moving from single-shift to two-shift operations to increase output, the Nagaokakyo site in Kyoto has been upgraded with cleanroom capability, and a new Shiga site is still undergoing groundwork. Order visibility was described as extending about six months, with some customers sharing two- to three-year forward-looking fab plans.
Management said CEO Mr. Goto has repeatedly emphasized improving profitability. The company said it has pursued that objective for the past seven years and wants to continue in order to catch up with peers, including Tokyo Electron and Kokusai Electric, by increasing average selling prices through product development and added value, with the goal of higher operating margin.
