Is Disco Corporation profitable in 2026?

Yes. Disco posted FY2025 (ended March 31, 2026) net income of ¥135.5B, a 31.0% net margin, on record consolidated sales of ¥436.9B, up 11.1% YoY, marking its sixth straight year of record sales and profit.

Who competes with Disco Corporation in wafer dicing?

Direct rivals include Tokyo Seimitsu (Accretech), ASMPT, Advanced Dicing Technologies, and Korea's ITI, which as of February 2026 was marketing laser 'Fine Cut' dicing for HBM4 and glass substrates as an alternative to Disco's blade and stealth dicing tools.

Could AI replace Disco Corporation's business?

No. Disco's core work is physically cutting, grinding and polishing semiconductor wafers, a hardware process AI software cannot perform. Generative-AI and HBM/data-center demand is instead cited by Disco as a growth driver behind its ¥436.9B FY2025 record sales.

Is Disco Corporation a safe company to join in 2026?

Headcount grew from 4,553 (March 2024) to 5,256 (February 2026), about 15% in two years, alongside six consecutive years of record sales and 42.3% FY2025 operating margins, though quarterly shipment swings caused a ~14% single-day stock drop on July 23, 2026.

Why did Disco Corporation's stock drop in July 2026?

On July 23, 2026 Disco shares fell about 14% in a single day after Q1 FY2026 preliminary shipments of ¥116.5B missed some analyst expectations, even though revenue rose 26 to 27% and net profit jumped 44% year over year.

Who owns Disco Corporation?

Disco is an independent public company listed on the Tokyo Stock Exchange (ticker 6146) since December 1999, with no parent company. President and CEO Kazuma Sekiya, a descendant of the founder, leads it; Baillie Gifford held over 2.6% of shares as of September 2025.

Semiconductor companies · Japan

Disco Corporation

disco.co.jp ↗

Japanese maker of precision wafer dicing and grinding tools for chip back-end processing.

Hard to displace

Assessed 24 July 2026 · Evidence as of 24 July 2026

Strong structural protection; the business model survives ai pressure.

On the recordSince 24 July 2026 · Checkable from October 2026 · Every call on the record Checkpoint: DISCO FY2026 Q2 financial results and shipment guidance update

The call

DISCO's grip on chipmakers' qualified dicing recipes has held through six record years, with the next test being whether ITI's laser dicing gets qualified into HBM4 lines.

Disco sells machines that slice and grind silicon wafers for semiconductor factories. The company is hard to replace because its equipment is locked into customer recipes through decades of use and because Disco also sells the grinding materials customers need, creating sticky business. A Korean competitor called ITI is developing laser-based cutting machines for advanced chips, and if ITI wins over major customers in the next year or two, Disco's advantage could erode quickly.

Why

AI pressure: None apparent. AI chip demand, especially HBM stacking, drives more dicing and grinding volume, not less, for DISCO. Could AI do the core job? Unlikely.

Bigger players: ITI (Korea). ITI is developing laser Fine Cut dicing for HBM4 and glass substrates, but has not yet won production slots at scale. Could a giant copy it? No, they are blocked.

What protects it. Customer fabs qualify DISCO's exact blades, recipes, and consumables into their process lines, making a swap costly and slow.

What would change this call

ITI announces a qualified design win for laser Fine Cut dicing at Samsung or SK hynix HBM4 lines. Would show DISCO's process lock-in is breakable at leading memory fabs.
DISCO reports consecutive quarterly shipment declines beyond the July 2026 miss. Would show the AI-capex tailwind reversing into a demand downturn.
DISCO's guidance updates tied to Samsung/SK hynix/Micron capex commentary over next two quarters. Would show how tightly DISCO's order book depends on memory customers' spending cycles.

Key numbers

FY2025 net sales ¥436.9B, up 11.1% YoY (2026-03-31)
FY2025 operating margin 42.3% (2026-03-31)
Shares fell ~14% in one day after shipment miss (2026-07-23)

Named risks

Quarterly shipment volatility tied to AI/HBM capex cycle triggered a ~14% stock drop on July 23, 2026. Severity: high
ITI's laser Fine Cut dicing could win HBM4/glass-substrate qualification at Samsung or SK hynix. Severity: medium
Large capex commitments for Haneda R&D center and Hiroshima Works (FY25 to FY27) if AI demand cools. Severity: medium
Company discloses only one-quarter-forward guidance, embedding structural forecast uncertainty. Severity: medium
Heavy reliance on overseas fabs, with 90.8% overseas sales ratio in Q1 FY2026. Severity: low

Rivals, as read in July 2026

Rival	Direction	Evidence
ITI (Korea)	contesting	Marketed laser Fine Cut dicing for HBM4 and glass substrates as of Feb 18, 2026, not yet qualified in production
Tokyo Seimitsu (Accretech)	contesting	Named direct rival in thin wafer dicing/grinding equipment market as of Dec 2025
ASMPT	contesting	Listed among Disco's closest peers in back-end dicing/grinding equipment, 2025
Applied Materials, TEL, Lam Research	losing to	Front-end WFE giants have stayed out of Disco's back-end dicing/grinding niche for decades

Questions people ask

Is Disco Corporation profitable in 2026?: Yes. Disco posted FY2025 (ended March 31, 2026) net income of ¥135.5B, a 31.0% net margin, on record consolidated sales of ¥436.9B, up 11.1% YoY, marking its sixth straight year of record sales and profit.
Who competes with Disco Corporation in wafer dicing?: Direct rivals include Tokyo Seimitsu (Accretech), ASMPT, Advanced Dicing Technologies, and Korea's ITI, which as of February 2026 was marketing laser 'Fine Cut' dicing for HBM4 and glass substrates as an alternative to Disco's blade and stealth dicing tools.
Could AI replace Disco Corporation's business?: No. Disco's core work is physically cutting, grinding and polishing semiconductor wafers, a hardware process AI software cannot perform. Generative-AI and HBM/data-center demand is instead cited by Disco as a growth driver behind its ¥436.9B FY2025 record sales.
Is Disco Corporation a safe company to join in 2026?: Headcount grew from 4,553 (March 2024) to 5,256 (February 2026), about 15% in two years, alongside six consecutive years of record sales and 42.3% FY2025 operating margins, though quarterly shipment swings caused a ~14% single-day stock drop on July 23, 2026.
Why did Disco Corporation's stock drop in July 2026?: On July 23, 2026 Disco shares fell about 14% in a single day after Q1 FY2026 preliminary shipments of ¥116.5B missed some analyst expectations, even though revenue rose 26 to 27% and net profit jumped 44% year over year.
Who owns Disco Corporation?: Disco is an independent public company listed on the Tokyo Stock Exchange (ticker 6146) since December 1999, with no parent company. President and CEO Kazuma Sekiya, a descendant of the founder, leads it; Baillie Gifford held over 2.6% of shares as of September 2025.

Timeline

2026-07-23Q1 FY2026 results: revenue up 26 to 27% YoY, net profit up 44%, shipments ¥116.5B
2026-07-23Shares fall roughly 14% in a day after shipment figure missed analyst expectations
2026-04-22FY2025 results filed: record ¥436.9B sales, 42.3% operating margin, sixth record year
2026-02-18Korea's ITI publicly touts laser Fine Cut dicing for HBM4 and glass substrates
2026-01-21FY2025 Q3 results detail new Haneda R&D center and Hiroshima Works capex plans
1999-12Disco lists on Tokyo Stock Exchange First Section
1937-05Company founded in Kure, Hiroshima as Dai-Ichi Seitosho Company

Revision history

24 July 2026

First assessed. Hard to displace. The text above is fixed as of this date and is not edited afterwards.

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